CBSA urges you to take action now to protect America’s innovation economy! The federal government is considering the use of “march-in rights” (where it could compel a patent-owner to license an invention) as a tool to regulate the price of inventions that were conceived or developed with the help of federal research funding, including Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) funding. This would upend the 43-year-old Bayh-Dole Act, which has supported the creation of thousands of start-ups, millions of jobs, and trillions of dollars in U.S. GDP from inventions at universities. This poses a particular threat to innovation across the life sciences ecosystem. 

The comment period on the new Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights closes on February 6, 2024. Please weigh in with input on the federal portal regarding the threat of the proposed new framework on “march-in rights” and the need to protect the Bayh-Dole Act! 

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New Draft Guidance: On December 7, 2023, the Department of Commerce’s National Institute of Standards and Technology (NIST) released for public comment its Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights, “a tool to help agencies evaluate when it might be appropriate to require licensing of a patent developed with federal funding.” “The draft guidance will help government agencies work through a range of policy considerations relevant to a potential march-in decision, including price.” 

The Lead-Up: In March of 2023, the National Institutes of Health (NIH) rejected a petition requesting that it take control of patents on the prostate cancer drug Xtandi on the grounds that its price was too high. Also in March of 2023, the Department of Health and Human Services (HHS) and the Department of Commerce (DOC) jointly announced they would “pursue a whole-of-government approach to review its march-in authority” and “develop a framework for implementation of the march-in provision that clearly articulates guiding criteria and processes for making determinations where different factors, including price, may be a consideration in agencies’ assessments.” 

The 1980 Bayh-Dole Act: Under the University and Small Business Patent Procedures Act of 1980, commonly known as the Bayh-Dole Act, the government allows recipients of federal research funding to retain rights to inventions conceived or developed with that funding. The Act gives federal agencies the right to “march in” under specific circumstances related to accessibility of the invention, as well as national health and safety (35 U.S.C. 203). Although some have called for “march-in” rights to be utilized to ensure inventions are affordable, the Act’s sponsors, Senators Birch Bayh and Bob Dole, have stated that “Bayh-Dole did not intend that government set prices on resulting products…The law instructs the government to revoke such [patent] licenses only when the private industry collaborator has not successfully commercialized the invention as a product.” The Bayh-Dole Act was intended to spur innovation, not serve as a tool to regulate prices. Watch this helpful overview video from the Bayh-Dole Coalition. 

The Problem: This new draft guidance would upend the 43-year-old Bayh-Dole Act, which has had a transformative effect on U.S. innovation, being hailed as “possibly the most inspired piece of legislation to be enacted in America over the past half-century.” The Bayh-Dole Act has supported the creation of thousands of revolutionary inventions, in the life sciences and beyond, including the once-a-day pill for HIV and the mRNA COVID-19 vaccines. The Bayh-Dole Act “fostered university-industry partnerships that helped lift the economy out of the doldrums of the 1970s, re-establishing America’s [technology] leadership.” It has continued to support the creation of thousands of start-ups, millions of jobs, and trillions of dollars in U.S. gross domestic product from inventions at universities. If the government uses march-in rights as a tool to regulate prices, America’s innovation economy would be put at risk, and innovation in the life sciences ecosystem would be hit especially hard. 

Take Action: The comment period on the new Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights closes on February 6, 2024. Please weigh in with input on the federal portal regarding the threat of the proposed new framework on “march-in rights” and the need to protect the Bayh-Dole Act!