The National Institute of Standards and Technology (“NIST”) recently released a draft framework that has garnered significant attention, particularly for its implications on the U.S. government's exercise of “march-in” rights. March-in rights are a regulatory mechanism that allows the government to intervene in the licensing processes of federally funded inventions under certain circumstances. This framework aims to clarify and potentially recalibrate the balance between public and private interests in the commercialization of government-funded research.

The draft has sparked a conversation about innovation, public access and the role of government in the development of new technologies. Here are three key points to consider:

• Clarification of Circumstances for Exercise: The framework aims to provide clearer guidelines on when the government can exercise march-in rights, seeking to balance encouraging private sector investment in innovation with safeguarding public interest.
• Impact on Public Access and Pricing: One of the central debates revolves around how this framework might influence the availability and affordability of products developed from federally funded research, particularly in the healthcare sector.
• Feedback and Future Directions: NIST is actively seeking feedback from various stakeholders, indicating that the final policy could evolve significantly based on input from the public, industry and academia.

Crowley Law has considerable expertise in dealing with the legal aspects of technology issues.  If you are a technology entrepreneur seeking to commercialize your great ideas and have questions about the legal issues you are facing, contact us at (844) 256-5891 or [email protected] to arrange for a conversation with a member of our team.

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Continuing on “march-in” rights . . . .

The exercise of march-in rights has long been a topic of debate within the realms of patent law, innovation policy and public administration. At its core, the concept is rooted in the Bayh-Dole Act of 1980.  The law allowed universities, nonprofits and small businesses to own patents on inventions derived from federally funded research.

Prior to enactment of this law, very little government funded research was commercialzed.  The focus of the new mechanism was to make it economically attractive to commercialize government-funded research.  The government retains certain rights, including march-in rights.

These rights enable the government to "march in" and license patents to other parties if the original patent holder fails to meet specific requirements, such as making the invention available to the public on reasonable terms.  Over the past 40+ years of the Act, only a handful of petitions have been made for an agency to exercize its march-in rights.  No agency has ever exercized those rights.

The NIST's draft framework represents a significant step towards refining this concept. By clarifying the circumstances under which march-in rights can be exercised, the government aims to prevent potential abuses and ensure that federally funded inventions fulfill their intended public benefit. This is particularly pertinent in sectors like pharmaceuticals, where the pricing and availability of drugs can have profound public health implications.

Critics and proponents of the framework alike recognize the delicate balance it seeks to strike. On the one hand, there is a need to incentivize private companies to invest in the development and commercialization of new technologies. Development of new drugs is very costly.  Many estimates of the average cost exceed $1 Billion and the average time to get to the market can be as much as ten years.

On the other hand, there is a public interest in ensuring that these technologies, particularly those funded by taxpayer dollars, are accessible and affordable. Nowhere is that more of a concern than in the pricing of drugs and other healthcare products.

The NIST's call for public feedback is a crucial aspect of this process. It reflects an understanding that the framework's success depends on its ability to address the concerns of a diverse range of stakeholders, from private industry to consumer advocacy groups. The feedback period is an opportunity for these parties to influence the final policy, ensuring it effectively balances the need for innovation with the public's interest.

As the draft framework continues to evolve, its impact on the landscape of innovation and public access to technology will be closely watched. The debate surrounding march-in rights is a microcosm of broader discussions about the role of government in innovation and the importance of ensuring that the fruits of publicly funded research are shared in a way that benefits society as a whole. The NIST's efforts to refine and clarify these rights are a step towards resolving these complex issues, offering a blueprint for how similar challenges might be approached in the future.

Crowley Law has considerable expertise in dealing with the legal aspects of technology issues.  If you are a technology entrepreneur seeking to commercialize your great ideas and have questions about the legal issues you are facing, contact us at (844) 256-5891 or [email protected] to arrange for a conversation with a member of our team.

We're here to help.