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Key excerpts: PhRMA submits comments to NIST in effort to safeguard intellectual property protections

Megan Van Etten
Megan Van Etten April 9, 2021

Key excerpts: PhRMA submits comments to NIST in effort to safeguard intellectual property protections.

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Earlier this week PhRMA submitted comments to the National Institute of Standards and Technology (NIST) regarding the proposed rulemaking on implementing regulations of the Bayh-Dole Act. Passed in 1980, the Bayh-Dole Act was a landmark piece of bipartisan legislation that established a uniform framework across the federal government to encourage technology transfer between universities and the private sector that has facilitated timely and efficient commercialization of early-stage research. Since its passage, it has fueled unprecedented innovation across the United States.

In the comments, PhRMA outlines why providing certainty when it comes to intellectual property (IP) protections in the United States is in the best interest of innovators everywhere. Below are five key excerpts from the comments highlighting the critical role IP plays in continued innovation in biopharmaceutical research, development and manufacturing.

  • IP rights are an essential link in the chain when it comes to the biopharmaceutical industry’s ability to innovate and develop new treatments and cures. “Collectively, clear IP ownership by the grantee along with the certainty of exclusive licensing terms established under the Bayh-Dole Act have helped foster licensing of technology resulting from federal funding for use by private sector entities to advance biomedical research. We believe the proposed changes to the implementing regulations of Bayh-Dole help maintain the balance of rights between innovators, contractors, licensees, and the federal agencies that contribute funding for early-stage research.”
  • Robust IP protections allow for continued innovation and job creation in the United States. “Strong and predictable intellectual property (IP) protections in the United States are essential to the United States’ economic well-being, and signal to other jurisdictions the critically important economic benefits of IP. The substantial investments related to biopharmaceutical R&D also fuel the U.S. economy. IP-intensive manufacturing industries drive economic progress and collectively support 57.6 million American jobs and the biopharmaceutical industry supports a total of more than 4.7 million jobs, contributing $1.3 trillion in economic output when direct and indirect effects are considered.”
  • The proposed rulemaking process reaffirms the importance of balancing the rights of all stakeholders. “PhRMA supports NIST’s efforts to improve certainty afforded to stakeholders regarding the use of march-in rights and the process for exercising march-in rights by its proposed changes to 37 C.F.R. § 401.6. As discussed further below, such changes (1) clarify the statutory bases for initiating march-in proceedings, (2) codify the “informal consultation” process when a funding agency is considering the exercise of march-in proceedings, and (3) amend the timeline for the agency deliberation period.”
  • NIST confirms that Bayh-Dole does not provide for price to be the basis for exercising march-in rights. “NIST’s articulation of the lack of statutory basis to exercising march-in rights on the basis of pricing decisions helpfully provides clarity and certainty to stakeholders. Indeed, the statute provides authority for a Federal agency to exercise march-in rights when it determines action is needed for a list of specific reasons that notably does not include pricing decisions.”
  • Through the proposed changes, NIST can help clarify the scope of the standard patent rights clause. “PhRMA supports NIST’s efforts to clarify the scope of the standard patent rights clause definition of “subject invention” and its efforts to provide for agency discretion to waive the requirement for the contractor to convey title to any subject invention… PhRMA welcomes the additional clarification and certainty that privately-funded, proprietary technology of contractors or their exclusive licensees are not subject to the rights and obligations of Bayh-Dole.”

Bottom line: The proposed NIST regulations provide helpful clarifications and reaffirm the importance of balancing the rights of all stakeholders who rely on the framework that the Bayh-Dole Act provides. The proposal will protect public health and benefit patients across the globe who are in need of new cures and treatments.

PhRMA’s full comments are available here.

Topics: Intellectual Property