Opinion: NC universities under attack, need patent protections for inventions

Have you ever wondered how the fruit you buy at the grocery store stays so fresh, sometimes after weeks of travel?In the 1980s, two scientists at North Carolina State University discovered the compound 1-methylcyclopropene, which slows ripening. Later commercialized as the product SmartFresh, it's now used on more than 30 crops.SmartFresh isn't the only successful invention from our state's universities. N.C. State researchers developed highly efficient, silicon-carbide-based semiconductors as well as a sweet potato that can thrive in adverse conditions. Doctors at Wake Forest School of Medicine developed COMPASS CP, a platform for developing patient-specific care plans across a variety of chronic care domains. And spinoff startups from University of NC are developing a gene therapy for hemophilia and a technology that treats mental illness with brain-wave stimulation.These innovations solve major real-world problems and they've brought economic gains to the state. Those silicon-carbide semiconductors spawned Wolfspeed, which is building a $5 billion fabrication plant in Chatham County and helping resuscitate the U.S. semiconductor industry.Perhaps the most significant thing these inventions have in common is they would never have seen the light of day if not for the Bayh-Dole Act, which empowers academic institutions to patent and license discoveries they make, in part, with federal funding.The creative flourishing fueled by Bayh-Dole is in danger. Some lawmakers advocated for revoking private companies' patent rights to inventions that received federal funding.In the most recent salvo, 25 legislators signed a letter to the Secretary of Health and Human Services. They urged him to act on a petition to use this section — Bayh-Dole's "march-in" provision — to redistribute the patents on cancer drug Xtandi as a means of forcing down its price.The Biden administration denied that request in March. But federal officials announced a plan to assess the scope of the government's authorities under Bayh-Dole. If they conclude the law empowers them to slash the price of federally funded inventions, it could damage the pipeline of university-to-marketplace innovation that has been an economic force and benefit to humanity.

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Prior to Bayh-Dole's passage, if the federal government provided funding for an academic research project, it automatically retained the patent rights to any resulting discoveries. But the government wasn't in the business of commercialization, so the majority of such breakthroughs never made it beyond the university. In fact, before Bayh-Dole, only about 5% of federally funded patents were commercialized by the private sector.Introduced by Senators Birch Bayh (D-Indiana) and Bob Dole (R-Kansas), the law empowered academic institutions to retain patent ownership and licensing rights even if a project received federal funding.Universities and private companies began partnering to turn groundbreaking research into tangible products, including the Google search algorithm, Honeycrisp apples, and all those N.C. discoveries mentioned above. Since its enactment, the tech transfer system created by Bayh-Dole has generated nearly 6 million jobs, sparked creation of more than 15,000 startups, and contributed over $1 trillion to U.S. economic growth.

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Bayh-Dole's march-in provision allows the government to relicense a patent if the rights-holder isn't commercializing an essential product. The law was never intended to be used as a price-control mechanism and existing products like Xtandi and COVID-19 vaccines have already been commercialized.Private-sector investment in drug development is significantly higher than federal contributions. In the case of Xtandi, the National Institutes of Health provided about $500,000, whereas drugmaker Astellas spent $1.4 billion. The rationale that it was primarily taxpayer funded is absurd.It's understandable that politicians want to lower drug prices. And they're using all avenues to do so. Sen. Bernie Sanders (I-Vermont) announced he'd stall confirmation of President Biden's nominee to lead the NIH unless the agency imposes a "reasonable price" on any biomedical innovation brought to market through a partnership with private industry.  They haven't considered the consequences of these efforts on innovation. Patents grant inventors exclusive rights to sell their products and earn a return on investment for a set period of time. This keeps money flowing into innovation. But no investor will take a chance on a product if they know the government can arbitrarily relicense its patent or ratchet down its price.If policymakers succeed, private companies and investors will think twice before licensing any research that previously received federal funding. That would profoundly damage our universities, economy, and American innovation.

Dave Winwood is former president of AUTM, the leading association of technology transfer professionals, and has more than 25 years of experience managing technology transfer offices in several U.S. universities, including UNC Chapel Hill and North Carolina State University. He currently leads Technology Transfer and Commercialization activities for Wake Forest Innovations.

This article originally appeared on Asheville Citizen Times: Opinion: Bayh-Dole Act in danger; universities need patent protections