The delicate balance of university innovation and translation
By Kelly Sexton
The “virtuous cycle” of accelerated technology transfer — the process by which university research funded by the federal government can be licensed, refined and marketed by private businesses — has been the driver for a whole string of uniquely American tech successes, from quantum computing to cutting-edge medical treatments.
Accelerated transfer works so well that it’s easy to forget how new — and how delicate — the policy balance is, or how the system was once so difficult to navigate.
Back in the late 1970s, America’s innovation pipeline was clogged. Then as now, university researchers were developing basic scientific knowledge through their research. And the business community was eager to engineer that knowledge into new consumer products. But because the patents on federally-funded science were held by the federal government itself, licensing the research became a bureaucratic obstacle course.
Both university researchers and the business community wanted reform, and the struggling economy of that time certainly needed it. U.S. Sens. Birch Bayh (D-Ind.) and Bob Dole (R-Kan.) partnered on a new system. Under their proposal, research institutions that conducted federally-funded research would be allowed to patent their work, and to license their intellectual property directly to the private sector.
The Bayh-Dole Act ushered in a new era of scientific discovery and economic innovation unlike anything the world had seen before.
The results speak for themselves. According to one study, the total economic output generated by the Bayh-Dole research cycle between 1996 and 2017 was $1.7 trillion, resulting in over 14,000 new businesses and 5.9 million jobs.
Bayh Dole unleashed the benefits of America’s innovation ecosystem and has been hailed as “the most inspired piece of legislation to be enacted in America over the past half-century.” Notwithstanding this success, some lawmakers want to use the law’s “march in” authority — which allows the government to relicense innovations in limited circumstances — as a backdoor mechanism to regulate drug prices.
Sens. Bayh and Dole clearly stated that the “march in” provision was written to encourage patent holders to license their work for development and was never intended to be a price control mechanism. Distorting that original intent would inhibit university-industry transfer and the very research pipeline that produces life-saving healthcare treatments.
America’s innovative, economic edge has long been bolstered by a strong policy framework that encourages public-private partnerships. This is why I’m heartened to see bipartisan support for much-needed investments in scientific research as part of the U.S. Innovation and Competition Act.
These investments could yield new breakthroughs that transform our industries and spur widespread economic opportunity. For that potential to be realized, though, we must ensure that any discoveries or technologies generated by this activity are transferred from the laboratory to the private sector for commercialization.
The Bayh Dole Act is the linchpin for this delicate balance. So long as we preserve its merits, we stand poised for a generational transformation of our innovation infrastructure.
Kelly Sexton, Ph.D., is the Associate Vice President for Research – Technology Transfer and Innovation Partnerships at the University of Michigan.