Connecticut has long been one of the most innovative states in the nation. Numerous technologies — from the helicopter to the pay phone and the polaroid camera – originated or were patented here.
Our world-class universities deserve much of the credit. Schools like Yale and UConn frequently make groundbreaking discoveries in their labs. They then license this research to private-sector companies, who turn it into real-world products.
As the former managing director of Yale Ventures, a position I held for 25 years, I understand just how important this academic technology transfer system is for the country. It has grown the economy by $1 trillion, supports 6.5 million jobs, helped launch over 17,000 startups, and catalyzed the development of more than 495,000 unique inventions.
Technology transfer has also brought over 200 life-saving drugs to market — including Zerit, one of the first effective antiretrovirals for HIV/AIDS, which was discovered by Yale researchers and licensed to Bristol Myers Squibb.
Unfortunately, a new bill before Congress could undermine this system of technology transfer between our universities and the private sector – and hurt the economy in the process.
The Medication Affordability and Patent Integrity Act would require drug manufacturers to provide stacks of paperwork to the United States Patent and Trademark Office that they’ve already submitted to the Food and Drug Administration.
Supposedly, this proposal would prevent drug companies from hiding information they submit to the FDA from patent examiners. The federal government would be able to invalidate any patent, no matter how old, if it decides these information-sharing requirements aren’t met.
The bill is nothing more than a solution in search of a problem. There’s no evidence that drug companies are systematically hiding relevant information from the USPTO when they file for patents. The proposed disclosure requirements are unnecessary regulatory barriers that will crush the private sector’s willingness to license and develop university technology.
The proposed bill threatens to grind the pace of these breakthroughs to a halt. Licensing and securing patents on medical research is already an arduous process, and companies won’t do it if they get mired in more red tape at the USPTO and FDA. And because the bill would overburden the patent office, it would gum up technology transfer for all inventions that come out of universities – not just drugs.
Indeed, the USPTO likely wouldn’t have the bandwidth to handle the additional information applicants are required to disclose. One study found that the USPTO may already be “receiving more information from applicants than patent examiners can effectively process.” Requiring applicants to provide the USPTO with redundant information they’ve already offered to the FDA would only burden examiners more.
Some lawmakers argue that the bill is necessary for cracking down on improperly issued drug patents — which they claim prevent cheap, generic medicines from coming to market. But there’s simply no evidence that drug companies are making a concerted effort to deceive the USPTO and FDA. Such behavior is already illegal. The USPTO has processes in place for penalizing companies that hide information, and existing U.S. law allows the agency to invalidate patents that are submitted with intent to deceive.
Moreover, if U.S. drug companies are gaming the patent system to stop generics from reaching patients, they’re doing a terrible job at it. Around nine in 10 prescriptions filled in the United States are for generics, higher than in any other developed country. And on average, generic drugs are 33% cheaper in the United States than in other nations.
Perhaps most troubling of all, the bill seriously endangers U.S. national security. The FDA’s drug approval process already requires manufacturers to disclose confidential information. Filing sensitive material with a second agency increases the risk that this information will be exposed. In fact, the USPTO’s existing disclosure requirements practically guarantee that it will be. Adversaries like China have already been extracting trade secrets and proprietary technology from U.S. companies for years. Now we risk giving that information away for free.
We can only hope this bill languishes — or else our innovation system will.
Jon Soderstrom served as managing director of the Office of Cooperative Research at Yale University from 1996-2021.
