NAM to Senate: Innovation and IP are Damaged by the Administration’s March-in Proposal
The National Association of Manufacturers (NAM) has voiced strong opposition to the Biden administration’s proposed changes to the Bayh-Dole Act’s march-in rights. NAM argues that these changes could severely impact intellectual property (IP) rights and stifle innovation across various industries.
Overview of March-In Rights
The Bayh-Dole Act of 1980 allows universities, non-profits, and small businesses to retain patents on inventions developed with federally funded research. March-in rights enable the government to intervene and grant additional licenses for these patents if the original patent holder fails to achieve practical application of the invention or if public health and safety needs are not reasonably satisfied.
Proposed Changes and NAM’s Stance
The current administration proposes expanding the criteria under which march-in rights can be exercised, particularly focusing on pricing concerns. This adjustment is intended to address instances where drug prices are deemed excessively high, allowing the government to license patents to other manufacturers to produce more affordable versions of the medication.
NAM strongly opposes this proposal, arguing that it undermines the fundamental principles of IP protection. They assert that altering the conditions under which march-in rights can be invoked introduces uncertainty for patent holders and diminishes the incentives for investing in new research and development.
Impact on Innovation
According to NAM, the proposed changes threaten to destabilize the delicate balance between encouraging innovation and ensuring public access to affordable products. They highlight that strong IP protections are crucial for fostering investment in high-risk research and development projects. Companies may be deterred from pursuing new ventures if there is a risk that their IP rights could be undermined by government intervention based on subjective criteria like pricing.
Industry Reactions
Various stakeholders within the manufacturing and pharmaceutical industries have echoed NAM’s concerns. They argue that the proposal could have a chilling effect on innovation, particularly in the biotech and pharmaceutical sectors, where the development of new drugs often requires significant investment and time. The potential for government intervention on pricing grounds may discourage companies from taking on such investments, ultimately slowing the pace of medical advancements and technological progress.
Legislative Appeal
NAM urges the Senate to reject the proposed changes, emphasizing that the existing Bayh-Dole framework has been instrumental in driving innovation and maintaining the United States’ competitive edge in technology and pharmaceuticals. They call for a careful consideration of the broader implications that altering march-in rights might have on the innovation ecosystem.
