Our National Security Depends on Intellectual Property
By Walter G. Copan
The National Institutes of Health (NIH) recently rejected a petition that asked the federal government to misuse a decades-old law by imposing de facto price controls on a widely available medicine.
This rejection is welcome news. The law in question, the Bayh-Dole Act, was passed in 1980 to incentivize the commercial development of discoveries arising from federally-funded research for the benefit of the public and the economy. Abusing this law would have negative ripple effects throughout all U.S. industries, threatening America's global economic competitiveness and national security.
The petition to NIH related to a provision in the Bayh-Dole Act that permits the government to "march in" to a company that had exclusive rights to a patent that came from federally-funded research, and to re-license that patent to others. The catch is that this power must only be used if a product based on such a patent isn't being made available to the public. It was never intended as a means to set prices on widely available commercial products.
Nevertheless, the petition's backers wanted Uncle Sam to use march-in authority to control the price of a drug initially discovered with the help of taxpayer funds. The NIH was right to reject their misguided proposal.
Bowing to calls to weaken intellectual property rights under the Bayh-Dole Act would stifle cutting-edge innovation in the United States. In effect, we'd be ceding ground to America's rivals in critical technologies, who already steal hundreds of billions of dollars' worth of U.S. IP every single year.
IP theft is a serious drain on America's military strength and readiness. China, Russia, and other competitors often seek IP relating to America's economic and national security., Theft affects sectors including artificial intelligence, communications, biotechnology, and advanced manufacturing.
Stopping the scourge of foreign IP theft will require a two-pronged approach. First, we need tougher enforcement of the tools available to combat IP piracy. Consider the International Trade Commission -- the government agency charged with investigating violations of IP rights by our trade partners. In one recent case involving electric vehicle batteries,, the ITC found that a U.S. manufacturer's trade secrets had been infringed, and it helped shut the infringement down.
Beating back our rivals' efforts to out-compete America through illegal means will also require promoting historic levels of innovation at home. That starts with rejecting any effort to weaken domestic IP protections, which affords innovators the incentive they need to carry out risky R&D, and investors the incentive they need to fund it.
On the same day the NIH rejected the petition to misuse Bayh-Dole, two cabinet agencies launched a new interagency working group effort to delineate when Bayh-Dole's march-in powers should be used. Worryingly, the agencies' announcement suggests that price might be a factor in future march-in determinations.
Misusing the law would set a precedent for government-imposed price controls across all industries, causing investment in high-risk R&D and innovation to crash.
The United States should fight to keep our IP out of the hands of unscrupulous foreign governments and other malicious actors. At the same time, policymakers need to uphold the robust IP protections that have kept the United States prosperous and strong since the Nation's founding.
Walter G. Copan, PhD, is vice president for research and technology transfer at Colorado School of Mines, and senior adviser with the Center for Strategic and International Studies and co-founder of its Renewing American Innovation project. He previously served as director of the National Institute of Standards and Technology (NIST).
