by Becky Mahurin

I am often asked, "Who owns federal-sponsored research?" I encounter this question from faculty who are concerned about MSU's ability to transfer technology created under federal sponsorship and from companies who are reluctant to support follow-on work for research initially supported by the government.

In 1980, Sens. Birch Bayh and Bob Dole sponsored legislation allowing non-profits and small businesses to patent research results emanating from federal grants. Prior to 1980, any technology developed with support from the government became the property of the federal government. Congress was unhappy with the fact that most of these technologies were dormant and unknown to the private sector (?) because government labs and federal agencies were not pursuing their transfer. In 1978 the U.S. government was spending $30 billion annually for R&D, but had licensed only 5 percent of the resulting patents.

Under the Bayh-Dole Act, universities are allowed to maintain patent rights and license and collect royalties from technologies created with federal support. The act does have certain requirements. The university or business must share royalties with the inventors. In addition, the university must comply with reporting requirements such as notification of the university's intent to retain the technology and to provide patent filings and licensing notification. The non-profit or business must also provide the agency with a license to use the technology internally for non-commercial purposes. This is generally not troubling to potential licensees of university technology, as no sublicensing rights are granted to the government.

In 1992 universities filed more than 2,700 patents and entered into more than 1,500 licenses. Royalties totaled more than $259 million for those licenses. Universities have benefitted from the Bayh-Dole Act. I also believe that the nation has benefitted by the increased competitiveness provided through new technologies transferred more effectively to the marketplace.

Becky Mahurin
Director of the Technology Transfer Office at MSU

© 2000 Montana State University-Bozeman
Discovery April 1995

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