Dec 8 -- The National Institute of Standards and Technology (NIST) seeks comments on the Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights, which reviews the factors that an agency may consider when deciding whether to exercise march-in rights. NIST requests information from the public on the proposed version of this guidance document to ensure that it is clear, and its application will both fulfill the purpose of march-in rights and uphold the policy and objectives of the Bayh-Dole Act. The information received in response to this RFI will inform NIST and the Interagency Working Group for Bayh-Dole (IAWGBD) in developing a final framework document that may be used by an agency when making a march-in decision. NIST will hold at least one informational webinar explaining the Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights and how the public can submit comments. Details about the informational webinar(s), including dates, times and any registration requirements, will be announced at
https://www.nist.gov/tpo/policy-coordination/bayh-dole-act. Comments must be received by 5 p.m. Eastern time on February 6, 2024 to be considered.
The Federal Government invests approximately $115B each year in extramural research and development at universities, non-profits, and small and large businesses. This results in the creation of thousands of inventions annually. The University and Small Business Patent Procedures Act of 1980, Public Law 96–517 (as amended), codified at title 35 of the United States Code (U.S.C.) 200 et seq., commonly known as the “Bayh-Dole Act” or “Bayh-Dole,” governs these inventions made with Federal assistance. The Bayh-Dole Act outlines the rights of persons, nonprofit organizations, and small business firms (“contractors”), and, as set forth in Executive Order 12591, all contractors regardless of size and to the extent permitted by law, in “any invention of the contractor conceived or first actually reduced to practice in the performance of work under a funding agreement” (“subject invention”) as well as rights retained by the government. One such right is the funding agency's right to require the contractor, an assignee, or exclusive licensee of a subject invention to grant a license to a responsible applicant or applicants, upon terms that are reasonable under the circumstances, and if the contractor, assignee, or exclusive licensee refuses such request, to grant a license itself (35 U.S.C. 203). This right, referred to as “march-in,” can only be exercised if the agency determines that:
(1) action is necessary because the contractor or assignee has not taken, or is not expected to take within a reasonable time, effective steps to achieve practical application of the subject invention in such field of use;
(2) action is necessary to alleviate health or safety needs which are not reasonably satisfied by the contractor, assignee, or their licensees;
(3) action is necessary to meet requirements for public use specified by Federal regulations and such requirements are not reasonably satisfied by the contractor, assignee, or licensees; or
(4) action is necessary because the agreement required by section 204 has not been obtained or waived or because a licensee of the exclusive right to use or sell any subject invention in the United States is in breach of its agreement obtained pursuant to section 204.
NIST has been delegated responsibility by the Secretary of Commerce to promulgate regulations concerning the management and licensing of federally funded inventions. On January 4, 2021, NIST published a notice of proposed rulemaking (NPRM) in the Federal Register (86 FR 35) requesting public comments on several proposed changes to the Bayh-Dole regulations at 37 CFR parts 401 and 404, including a provision related to march-in rights which stated that march-in “shall not be exercised exclusively based on the business decisions of the contractor regarding the pricing of commercial goods and services arising from the practical application of the invention.” In connection with that provision and other proposed changes, NIST received over 81,000 public comments and was directed through Executive Order 14036 to consider not finalizing the provision on march-in rights and product pricing in the proposed rule. In the Final Rule published in the Federal Register (88 FR 17730) on March 24, 2023, NIST did not finalize this provision but stated its intent to engage with stakeholders and agencies with the goal of developing a comprehensive framework for agencies considering the use of march-in.
NIST has been working with the IAWGBD which regularly meets to find agency consensus on policy and procedures related to the implementation of the Bayh-Dole regulations, to draft this framework. The objectives for the Draft Interagency March-In Guidance Framework are to:
-- Provide clear guidance to an agency on the prerequisites for exercising march-in, and, if those prerequisites are met, on facts to be gathered by the agency and factors to consider in determining whether to march-in.
-- Ensure that decisions to exercise march-in support the policy and objectives of Bayh-Dole.
-- Encourage the consistent and predictable application of the Bayh-Dole Act's march-in authority.
-- Balance the need to incentivize industry investment in the development and commercialization of subject inventions with the need to promote public utilization of subject inventions.
NIST publishes this notice to seek comments on the Draft Interagency Guidance Framework for Considering the Exercise of March-in Rights, included with this RFI as Appendix A.
NIST is specifically interested in receiving input from the public pertaining to the following questions:
(1) After reading through the framework and example scenarios, if needed, how could the guidance about when an agency might want to exercise march-in and the factors that an agency might consider be made clearer?
(2) The framework contains many terms which have specific meanings under Bayh-Dole or in technology development and commercialization. Are the definitions provided at the beginning of the framework easy to understand? Do they aid in your ability to interpret the framework?
(3) How could the framework be improved to be easier to follow and comprehend?
(4) Does this framework sufficiently address concerns about public utilization of products developed from subject inventions, taking into account the fact that encouraging development and commercialization is a central objective of the Bayh-Dole Act?
(5) The framework is not meant to apply to just one type of technology or product or to subject inventions at a specific stage of development. Does the framework ask questions and capture scenarios applicable across all technology sectors and different stages of development? How could any gaps in technology sectors or stages of development be better addressed?
FRN:
https://www.federalregister.gov/d/2023-26930