Is Bayh-Dole Good for Developing Countries? Lessons from the US Experience

Abstract

Recently, countries from China and Brazil to Malaysia and South Africa have passed laws promoting the patenting of publicly funded research [1,2], and a similar proposal is under legislative consideration in India [3]. These initiatives are modeled in part on the United States Bayh-Dole Act of 1980 [4]. Bayh-Dole (BD) encouraged American universities to acquire patents on inventions resulting from government-funded research and to issue exclusive licenses to private firms [5,6], on the assumption that exclusive licensing creates incentives to commercialize these inventions. A broader hope of BD, and the initiatives emulating it, was that patenting and licensing of public sector research would spur science-based economic growth as well as national competitiveness [6,7]. And while it was not an explicit goal of BD, some of the emulation initiatives also aim to generate revenues for public sector research institutions [8]. We believe government-supported research should be managed in the public interest. We also believe that some of the claims favoring BD-type initiatives overstate the Act's contributions to growth in US innovation. Important concerns and safeguards—learned from nearly 30 years of experience in the US—have been largely overlooked. Furthermore, both patent law and science have changed considerably since BD was adopted in 1980 [9,10]. Other countries seeking to emulate that legislation need to consider this new context.