The Biden administration announced a proposal yesterday that would allow federal agencies to break taxpayer-funded patents of high-cost drugs, citing a broadened interpretation of a 1980 patent law. The initiative prompted a 60-day public comment period.
Before 1980, publicly funded development projects—like those from NASA—were owned by the US government by default. The 1980 Bayh-Dole Act sought to spur the commercialization of thousands of unused patents by allowing federally supported inventors to own their products outright. As part of the law, the government retained certain rights to "march-in" and hand the patent to a third party or itself. Agencies have rejected every petition to do so (see timeline). As recently as March, the National Institutes of Health declined to use the mechanism to slash the price of prostate cancer drug Xtandi.
Officials claimed—for the first time—the law allows its agencies to seize patents of high-cost drugs based on that criterion alone, without specifying which medicines were possible targets of the mechanism. Critics argue the step will deter innovation.