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Writer's pictureAndrew Langer

CPAC 2024 Follow-Up: Biden's Plan to Seize Patents - Bad for Patients, Bad for Innovators, Bad for HBCUs



On the morning of Day 3 of CPAC 2024, a panel on Bidenomics was held, featuring FCC Commissioner Brendan Carr, noted economist Steve Moore, and former Member of Congress Doug Collins (GA-9). Though a wide-ranging discussion about the economic impact of the Biden Administration was had, Rep. Collins focused much of his remarks on the Biden Administration's proposal to seize certain patents in the name of engaging in price controls, under the "march-in" provisions of the 1980 Bayh-Dole Act.


The Bayh-Dole Act has been a cornerstone in the U.S. policy of promoting technology transfer from academic institutions to the marketplace. By allowing universities to own and commercialize inventions developed with federal funding, the Act spurred a wave of innovation, leading to the creation of products and services that have significantly impacted both the economy and everyday life. However, the recent proposal by the Biden Administration to reinterpret the Act's March-in provisions represents a seismic shift. This change could allow the government to forcibly license patents to third parties, ostensibly to lower drug prices or ensure wider availability of healthcare products. This reinterpretation could undermine the very foundations of innovation by introducing uncertainty and diminishing the incentives for private investment in new technologies.


Rep. Collins said, "What this is literally is marching in to where they have people who have taken government funds to find new and innovative solutions across the spectrum of products in which they come to our markets. What they're wanting to do, though, is if you've taken government money, the government wants to come in and then take your patent, take your intellectual property, and then they can do whatever they want to with it. This will send us back to pre-1980 Ronald Reagan."


Panel Moderator, Andrew Langer, Director of the CPAC Foundation's Center for Regulatory Freedom added, "The greatest expansion of pharmaceutical research occurred in the years after the Bayh–Dole bill was passed in 1980. The Biden administration wants to take us back."


The role of PBMs in the pharmaceutical supply chain further complicates the landscape. PBMs were originally intended to reduce prescription drug costs and ensure patients' access to medication. However, the consolidation of power among a few major PBMs has led to practices that many argue actually increase prices and limit access. By exercising significant control over formularies, PBMs can dictate which drugs are available to patients and at what cost, often prioritizing medications that provide the highest rebates from manufacturers rather than those that are most cost-effective or beneficial to patients.


Collins had this to say, "There's a little evil thing out there and it's three letters called PBM, pharmacy benefit managers. Thank you. If you understand, if you get it, if you not look it up, pharmacy benefit managers are what is strangling your neighborhood pharmacies. They're making costs go up and they're doing it on government taxpayer dollars and state health benefit plans across this country... When you are taking businesses and you're causing healthcare costs to rise, opposed to what they actually say and you're making businesses go out of business because they want to control everything, then this is where the Biden administration with their help. They would rather go after "big bad business" instead of going after these businesses that are actually taking dollars out of your pocket."


This dynamic raises fundamental questions about the balance between innovation, access to healthcare, and the role of government in regulating both. While innovation is critical for developing new treatments and advancing public health, there must be mechanisms to ensure that these advancements are accessible to those who need them most. The debate over the Bayh-Dole Act's March-in provisions and the power of PBMs underscores the need for policies that encourage innovation while also safeguarding public interest and welfare.


Furthermore, the potential of Historically Black Colleges and Universities (HBCUs) to become innovation hubs highlights the importance of ensuring equitable access to the benefits of technology transfer and innovation. Efforts to secure funding for HBCUs and facilitate their participation in tech transfer activities represent a vital step toward democratizing innovation. By supporting diverse voices and perspectives in the innovation ecosystem, we can foster a more inclusive and dynamic environment that benefits all segments of society.


The discussions around the Bayh-Dole Act and PBMs reflect broader challenges in aligning innovation, access, and cost within the American healthcare system. As we navigate these debates, it is crucial to prioritize policies that support both the creation of new technologies and the public's ability to benefit from them, ensuring a healthier and more prosperous future for all.

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