Baked into Bayh-Dole is the policy expectation that a holder of a patent on a subject invention will offer products based on that invention as if there were competition, even if a patent is used to suppress that competition. In the case of medicines, this policy reduces to: offer products as if they were generics.
The logic becomes evident: if one doesn’t offer products as if they were generics, then the terms are “unreasonable” and the federal government is authorized–expected–to protect the public by requiring licensing to introduce “free competition.” It actually works. You just have to get over all the nonsense you hear from people who have a vested interest in making sure Bayh-Dole’s public bargain never operates. To timely achieve practical application then means to provide patented product, or benefit from using a patented process, to the public on terms, including price, as if what’s offered has competition from others also practicing the invention. It’s not just that there’s competition from other companies that hold their own patents and charge what amounts to a patent monopoly price–their pain killer, say, uses a different compound, but you both have patents to stifle competition for each of our compounds (and any analogues), so you both can charge monopoly prices. Bayh-Dole’s licensing remedy only indirectly addresses such competition. No, the remedy of licensing works only if the patent holder (or ilk) or the federal government breaks up the patent monopoly and, in the case of the patent holder, at least, receives compensation for use by others, who then are in competition with the patent holder and with each other (and potentially in competition with the federal government). Continue reading