1. Mark Langguth Sr. Attorney, Intellectual Property Argonne National Laboratory February 21, 2012 Bayh-Dole: Basics & Beyond 1

2. $147 Billion* *Est Govt Funding of R&D, FY 11 - R&D Mag, Dec 2010 What is the key statutory framework regarding patent rights under Federal Funding? 2

3. Bayh-Dole Background 1980: 28,000 patents owned by Government, subject to different Agency policies – very few commercialized. “Possibly the most inspired piece of legislation to be enacted in America over the past half-century was the Bayh-Dole act of 1980… More than anything, this single policy measure helped reverse America’s precipitous slide into industrial irrelevance.” Economist Technology Quarterly, Dec. 14, 2002 Example public health and well being technologies developed under the Bayh-Dole Act (P.L. 96-517): (http://www.autm.net/Bayh_Dole_Act/5222.htm): (http://www.autm.net/Bayh_Dole_Act/5222.htm – Synthetic penicillin – Hepatitis B vaccine – Citracal calcium supplement – Cisplatin and carboplatin (cancer therapeutics) – Human growth hormones – Treatments for Crohn’s disease – Avian Flu vaccine – Clean water technologies More predictable, uniform, efficient 3

4. References Key statutes - 35 U.S.C. 200 et seq. – Presidential Memorandum on “Government Patent Policy” (1983) – Executive Orders 12591 and 12618 (1987) – 37 CFR 401 (Standard Patent Rights Clause: 37 CFR 401.14) FAR 52.227-11 DEAR 952.227-11 DFAR 252.227-7038 (large business) However, other “Guidance” & “Best Practices” (NIH) http://www.ott.nih.gov/policy/policies_and_guidelines.aspx http://www.ott.nih.gov/policy/policies_and_guidelines.aspx – Research Tools, Organism, and Data sharing policies – IP Management Plans 4

5. Funding Agreement - 35 U.S.C. 201(b) – Contract, grant, cooperative agreement for R&D funded in whole or part by Govt. – Includes sub-awards However, not Funding Agreements – Off-the-shelf items, non-R&D routine services – Other Transaction Authority (OTA) – User Agreements (Privately-funded effort) – Work-For-Others (Privately-funded) Key provisions - Definitions 5

6. Subject Invention - 35 U.S.C. 201(e) – Conceived or first actual reduction to practice However, not Subject Inventions – Background Inventions – Fence Statement of Work – Copyright/data 6

7. Key provisions – Reporting Must disclose within “reasonable” time - 35 U.S.C. 202(c)(1) Implementing Regulations: 37 CFR 401.14(c) or FAR 52.227-11(c) Disclose within 2 months (internal report) Elect within 2 years from disclosure File within 1 year of election int rpt Disclose Elect File t 2 mo 2 yrs 1 yr However, Federal Government may retain title if not timely disclosed, elected, or filed – Campbell Plastics Engineering & Mfg., Inc. v. Brownlee 389 F.3d 1243 (Nov. 10, 2004) 7

8. Key prov. – Reporting (continued) Implementing Regulations can vary re: reporting - DFAR 252.227-7038 Disclose within 6 months after ‘made’ Elect within 8 months after disclosure File provisional or non-provisional within 1 year after election File non-provisional within 10 months after provisional made Disclose Elect File report t 6 mo 8 mo 1 yr 3 mo However, final report/closeout raise FCA issue? – Final invention report within 3 months after completion of work withhold payment $50K or 5% for large business – Cafasso, United States ex rel., v. General Dynamics C4 Systems, Inc., 637 F.3d 1047 (C.A. 9 2011) 8

9. Key provisions – Govt-Use License Retained Government-use Rights – 35 U.S.C. 202(c)(4) – Nonexclusive, paid-up license to practice for or on behalf of U.S. Government However, note 28 U.S.C. 1498 9

10. Government-Use License Continued Not a Subject Invention; no Govt-use license – Fence Statement of Work – Background Inventions – Surrogates or models – Background Limited Rights Data – Essential combinations of IP Not a Funding Agreement; Limited (or no) Govt-use license – Off-the-shelf items/services – Some Other Transaction Authority (OTA) agreements – Some User Agreements (Privately-funded effort) – Some Work-For-Others (Privately-funded effort)? 10

11. Key provisions – March-In Rights March-In Rights – 35 U.S.C. 203 – License to third parties for non-Government purposes However, note NIH Determinations to NOT March-In (GAO report GAO-09-742) Fabrazyme (Mount Sinai license to Genzyme - availability) Xalatan (Columbia University license to Pfizer – price) Norvir (Abbott – price) CellPro (John Hopkins license to Baxter – development) (http://www.ott.nih.gov/policy/policies_and_guidelines.aspx)http://www.ott.nih.gov/policy/policies_and_guidelines.aspx 11

12. Key provisions – US Preference “Preference” for U.S. Industry – 35 U.S.C. 204 … no [Bayh-Dole patent owner] shall grant … exclusive right in U.S. …unless manufactured substantially in U.S. However, compare U.S. “Competitiveness” under Stevenson Wydler -- 15 U.S.C. 3701a (c)(4)(B) …in deciding what [CRADAs] to enter into shall-- give preference to business units located in the United States which agree that products embodying inventions made under the cooperative research and development agreement or produced through the use of such inventions will be manufactured substantially in the United States Note potential increase in enforcement 12

13. Other Items of Interest Non-Assignment - 35 U.S.C. 202 (7) In the case of a nonprofit organization, (A) a prohibition upon assignment of rights to a subject invention in the United States without the approval of the Federal agency, …. Contractor Action to Protect the Government's Interest - 37 CFR 401.14 (f) (2) (2) The contractor agrees to require, by written agreement, its employees, other than clerical and nontechnical employees, to disclose promptly in writing to personnel identified as responsible for the administration of patent matters and in a format suggested by the contractor each subject invention made under contract in order that the contractor can comply with the disclosure provisions of paragraph (c), above, and to execute all papers necessary to file patent applications on subject inventions and to establish the government's rights in the subject inventions.... 13

14. Determination of Exceptional Circumstances (DEC) 35 U.S.C. 202 – Pooling of Intellectual Property – Enhanced US Mfg – International Agreements Key exception 14

15. Thank you 15