William J. Madia
Bayh-Dole: Undeniably Effective
April / May 2005
Volume 3 Number 2
The value of an idea lies in the using of it.
—€” Thomas Edison
Scientists in America's national laboratories play a central role in scientific discovery in this country. But without an effective way to move them from research and development into application, many of the best ideas might never be put to use. The Bayh-Dole Act provides the mechanism that allows the public's investment in the national laboratories to deliver the greatest possible return to our economy and quality of life.
The provisions of Bayh-Dole enable small businesses, universities and not-for-profit organizations to take title to inventions developed with federal funds. Certainty of title to inventions made under federal funding is a critical incentive that enables laboratories to partner with industry to transform government-derived technologies into products for commercial use.
The effectiveness of Bayh-Dole is undeniable—€”for national labs, for industry and for society in general. For example, the number of active licenses from DOE national labs has more than doubled since 1999 from 1,922 to 4,245. Between 1996 and 2004, revenue generated from licensing technologies to private industry grew from approximately $4 million annually to more than $28 million each year. In this time of tight science and technology budgets, the growth in revenue is important because it increases the amount of money that can be re-invested in the national labs to fund the next wave of research conducted for the greater public good. It also shows the level of interest industry has for what the national labs have to offer.
VALUABLE PARTNERSHIPS
Before the passage of Bayh-Dole and related legislation, there was little incentive for research facilities to move innovations into the commercial arena. As a result, useful technology stayed bottled up within the labs.
Bayh-Dole paved the way for the national labs and industry to form partnerships that allow technology developed for the government to be applied for commercial use. Additionally, by allowing non-profit entities to take title to government-funded inventions, retain title through multiple funding sources and then license those inventions to industry, a complementary relationship was born that is advantageous to all parties.
User facilities at the labs are an example of a national laboratory resource that leads to higher-quality research on all fronts. Located at almost every lab, user facilities allow industry and the university community access to world-class research staff and equipment in areas ranging from energy, environment and security to nanoscience, biotechnology and medicine.
At the same time, working on real-world problems gives laboratory researchers an understanding of the economic constraints and other problems facing industry. They come face to face with the fact that the greatest technology in the world is useless if it is too expensive to produce and sell. Or as Edison said, ". . . sale is proof of utility, and utility is success."
Bayh-Dole cleared the path for numerous other ways in which research facilities strengthen the U.S. economy through technology transfer. These methods include providing technology and business assistance to small companies, allowing staff to take advantage of entrepreneurial leave-of-absence programs, supporting local and regional economic development programs, supporting the development and use of incubator facilities, and contributing to the creation of new business ventures.
ENDURING BENEFITS
Getting technology out of the labs and into use by the private sector has many benefits on a national and global scale.
Technology transfer results in a direct boost to our economy. New products and businesses resulting from lab technologies means new jobs, economic growth and an increased ability to compete internationally.
It also makes sense economically for private industry. Where it is not financially feasible for industry to invest in their own research or facilities, they can access the unique resource represented by our federal laboratories.
Benefits show up again through the transfer of the technology once it has been developed. The taxpayer receives a return on its R&D investment, and the commercial company can acquire a technology for less than it would have had to spend to develop it independently.
Inventors from our research institutions also benefit by seeing the technology they create transferred to industrial partners. Not only do inventors see their research used in commercial products or services, they also share in the financial success resulting from the transfer. Moreover, when a new business venture results from the licensing of lab technology, inventors may have the option of joining or becoming affiliated with the new company.
The ability to transfer technology from research facilities to industry will become even more important as industry continues to move away from basic research. Twenty years ago, government and industry research activities were on equal footing, with each side conducting approximately 50 percent of the nation's research and development.
Now the balance has shifted. Industry is more actively involved in product development, with the government assuming a much more prominent role in fundamental research. Even more significant is the pressure on the United States to keep pace economically and technologically with Europe and Asia. Our federally funded research institutions continue to make exciting discoveries that improve the quality of our lives and the prospects for our future. But without the provisions outlined in Bayh-Dole, their ability to share the results of their work would be substantially reduced.
To quote Edison one last time, "There's a way to do it better—€”find it." That's just what the national labs are doing—€”with the help of Bayh-Dole.
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