The Bayh-Dole Act, a 1980 law intended to prod the commercialization of government-supported research, gave universities a major role in ushering in the new era of biotechnology. The law fulfilled legislators' most ambitious expectations by encouraging the patenting of academic research--and the exclusive licensing of those patents to industry. In 1979 universities received a mere 264 patents--a number that in 2000 rose to 3,764, about half of which went to biomedical discoveries. The 14-fold increase far outpaced the overall growth in patents during that period. A few voices in the intellectual-property community have now charged that Bayh-Dole has gone too far. Patents, they claim, have been granted on the fruits of biomedical research that should remain in the public domain. In recent co-authored articles, Arti K. Rai of the University of Pennsylvania and Rebecca S. Eisenberg of the University of Michigan at Ann Arbor have proposed reform of the law, contending that development of new biopharmaceuticals and related technologies has been hindered by extending patent coverage beyond actual products to basic research findings. DNA sequences, protein structures and disease pathways should, in many cases, serve as a general knowledge base that can be used freely by everyone.
Rai and Eisenberg cite the case of a patent obtained by teams at Harvard University, the Massachusetts Institute of Technology and the Whitehead Institute for Biomedical Research in Cambridge, Mass. It covers methods of treating disease by regulating cell-signaling activity involving nuclear factor kappa B (NF-kB), which controls genes for processes ranging from cell proliferation to inflammation in various maladies. Those institutions and Ariad Pharmaceuticals (also in Cambridge), the exclusive licensee of the patent, are now suing Eli Lilly, claiming that two of its drugs--one for osteoporosis, one for sepsis--infringe the patent. Ariad has contacted more than 50 other companies that are researching or commercializing drugs that work through this pathway, asking them for licensing fees and royalties. The broad-based patent does not protect specific drugs. Instead it has become a tollbooth for commercial drug research and development on the NF-kB pathway. "In this case, as in many others, upstream [precommercial] patents issued to academic institutions serve as a tax on innovation, diluting rather than fortifying incentives for product development," the authors wrote in the winter-spring issue of Law and Contemporary Problems. (Their other article on the Bayh-Dole Act appeared in the January-February issue of American Scientist.)
This article was originally published with the title Razing the Tollbooths.