Liberals latest attempt to lower drug prices undermines America’s IP System – and violates the intent of the longstanding bipartisan law that enables universities, nonprofit research institutions and small businesses to own, patent and commercialize inventions. Public health activists seeking to lower prescription drug prices have recently seized on two fundamentally flawed approaches that would eviscerate patent rights and distort patent law: Section 1498 “government patent use” and “Bayh-Dole march-in rights.”
Progressive advocacy groups have repeatedly petitioned the federal government to undermine America’s patent system and institute dangerous price-setting policies. One recent attempt was a letter from the newly launched Make Meds Affordable campaign to the U.S. Department of Health and Human Services (HHS) Secretary Xavier Becerra.
Liberal Members of Congress like Sen. Warren have also urged HHS to exercise march-in rights in a short-sighted attempt to lower drug prices. Yielding to this demand is equivalent to an announcement that the U.S. government can invalidate patents and other intellectual property whenever it pleases.
What they seek is unprecedented. But don’t take our word for it, hear what the experts are saying.
Quotes from IP scholars and policy leaders who are pushing back against the liberals’ agenda to undermine America’s IP system:
The government has no power to forcibly relicense patents on the basis of price under the Bayh-Dole Act. And by taking the unprecedented step of ripping up patent licensing agreements, the government may not deliver cheaper drugs to consumers, but it would gut startups in multiple industries and prevent countless innovative products from ever coming to market.
Law360, “Marching In On Patents Under Bayh-Dole Would Gut Startups” – Chris Israel, Executive Director at the Alliance of U.S. Startups & Inventors for Jobs, and Member of the Bayh-Dole Coalition’s Board of Directors. (9/16)
Bayh-Dole allows the government to “march-in” and relicense the patents to third parties — but this was only supposed to be in an exceptionally narrow set of circumstances when the products are truly unavailable to the public.The government has never once found a reason to assert its march-in rights…Congress certainly didn’t intend march-in rights to be used to control drug costs. In fact, administrations of both parties have rejected all previous petitions to march-in based on the price of publicly available products.
RealClearPolicy, “Prostate Drug Price Controls Come at Too High a Cost” – Dr. Craig Garthwaite, Kellogg School of Management at Northwestern University (5/25)
The so-called march-in rights created under Bayh-Dole were conceived as an emergency provision should the development of an important technology stall. In cases where a company was either unable or unwilling to turn a licensed patent into a practical product, the government could revoke that license and reissue it to another firm better equipped to do the job. The circumstances justifying “march-in” were so limited that the government has never once done so on a private firm in the more than 40 years Bayh-Dole has been on the books. Should the Biden administration ignore this clear intent and march in, the costs for America’s economy, especially small businesses, would be calamitous.
RealClear Health, “Drug Patent Seizures Put American Innovation at Needless Risk” – Karen Kerrigan, Small Business & Entrepreneurship Council (6/13)
Public health activists seeking to lower prescription drug prices have recently seized on two fundamentally flawed approaches that would eviscerate patent rights and distort patent law: Section 1498 “ government patent use ” and “ Bayh-Dole march-in rights .” For obvious reasons, policymakers should resist this siren song…
Washington Examiner, “Beware the siren song of ‘government patent use’ as a way of lowering drug prices” – Michael Rosen, American Enterprise Institute (4/29)
The government has no authority to set prescription drug prices under existing law. In the case of Bayh-Dole, the intent of the law’s authors matches multiple administrations’ interpretations of it…Bayh-Dole does not provide the authority for the government to relicense drug patents because some politicians believe some medications are too expensive. Our lawmakers should not press such erroneous interpretations but rather act in accordance with the laws on the books. For progressive legislators — or anyone — to pressure NIH to violate this clear law is not only legally unsound, but highly irresponsible.
RealClearPolicy, “The Law is Clear: There’s No Legal Authority to Control Prices Via Bayh-Dole” – Former Chief Judge Paul Michel, United States Court of Appeal for the Federal Circuit (8/2)
If the Biden Administration were to reverse this precedent and allow the HHS to misuse Bayh-Dole’s “march-in” rights to impose prescription drug price controls, they would discourage drug manufacturers from entering into future public-private partnerships. Driving a wedge between the world’s leading research organizations and the only companies capable of turning a potential medical breakthrough into a lifesaving cure is not a recipe for success.
Blog Post, “Calls to Undermine Patent Protections Must Be Rejected, Innovation Depends on It” – David Williams, Taxpayers Protection Alliance (5/10)