Request for Information Regarding the Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights, 85593-85605 [2023-26930]

Agencies

• DEPARTMENT OF COMMERCE
• National Institute of Standards and Technology

[Federal Register Volume 88, Number 235 (Friday, December 8, 2023)]
[Notices]
[Pages 85593-85605]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-26930]


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DEPARTMENT OF COMMERCE

National Institute of Standards and Technology

[Docket No.: 230831-0207]


Request for Information Regarding the Draft Interagency Guidance 
Framework for Considering the Exercise of March-In Rights

AGENCY: National Institute of Standards and Technology, Department of 
Commerce.

ACTION: Notice; Request for Information (RFI).

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SUMMARY: 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

[[Page 85594]]

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.

DATES: Comments must be received by 5 p.m. Eastern time on February 6, 
2024 to be considered. Written comments in response to the RFI should 
be submitted according to the instructions below. Submissions received 
after that date may not be considered.

ADDRESSES: Comments may be submitted by electronic submission via the 
Federal eRulemaking Portal.
    1. Go to www.regulations.gov and enter NIST-2023-0008 in the search 
field.
    2. Click the ``Comment Now!'' icon, complete the required fields.
    3. Enter or attach your comments.
    Please submit comments only and include your name and/or your 
organization's name (if any) in your submission. Comments containing 
references, studies, research, and other empirical data that are not 
widely published should include copies of the referenced materials.
    All submissions, including attachments and other supporting 
materials, will be a matter of public record. Relevant comments will 
generally be available on the Federal eRulemaking Portal at https://www.Regulations.gov. NIST will not accept comments accompanied by a 
request that part or all of the material be treated confidentially 
because of its business proprietary nature or for any other reason. 
Therefore, do not submit confidential business information or otherwise 
sensitive, protected, or personal information, such as account numbers, 
Social Security numbers, or names of other individuals.

FOR FURTHER INFORMATION CONTACT: Mojdeh Bahar, Associate Director for 
Innovation and Industry Services, National Institute of Standards and 
Technology, 100 Bureau Drive, Gaithersburg, MD 20899, (301) 975-2340 or 
by email to [email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    The Federal Government invests approximately $115B each year in 
extramural research and development at universities, non-profits, and 
small and large businesses.\1\ 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:
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    \1\ National Center for Science and Engineering Statistics. 
Survey of Federal Funds for Research and Development, 2021. 
Available at: https://ncses.nsf.gov/surveys/federal-funds-research-development/2021.
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    (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) 
\2\ 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) \3\ 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.
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    \2\ Rights to Federally Funded Inventions and Licensing of 
Government Owned Inventions, 86 Federal Register 35, https://www.federalregister.gov/d/2020-27581.
    \3\ Rights to Federally Funded Inventions and Licensing of 
Government Owned Inventions, 88 Federal Register 17730, https://www.federalregister.gov/d/2023-06033.
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    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.

II. Request for Information

    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.

[[Page 85595]]

    All responses that comply with the requirements listed in the DATES 
and ADDRESSES sections of this RFI will be considered.
    The following list of topics covers the major areas about which 
NIST seeks information. The listed areas are not intended to limit the 
topics that may be addressed by respondents so long as they address the 
proposed march-in framework, including, but not limited to, sections or 
questions that are confusing or need additional context or explanation; 
additional sub-questions that would assist an agency in answering the 
major questions outlined in the framework; specific challenges posed by 
the framework as written; and other recommended improvements. Responses 
may include any topic believed to have implications for decision making 
related to march-in, regardless of whether the topic is included in 
this document.
    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?
    Authority: 35 U.S.C. 203, 206; DOO 30-2A.

Alicia Chambers,
NIST Executive Secretariat.

Appendix A

Draft Interagency Guidance Framework for Considering the Exercise 
of March-In Rights

Table of Contents

Definitions
Introduction to March-in Rights & Framework
Does Bayh-Dole Apply?
Ownership and Licensing
Is a Statutory Criterion Met?
Would March-In Support the Policy & Objective of Bayh-Dole, 
Considering The Specific Case And Broader Context?
Scenarios & Examples

Definitions

    When used within this framework, including the introduction, the 
terms listed below should be interpreted as defined below:
    Agency--Any executive agency as defined in section 105 of title 
5, and the military departments as defined by section 102 of title 
5. For purposes of this framework, and in accordance with 35 U.S.C. 
203 ``agency'' shall refer to the agency or agencies under whose 
funding agreement the subject invention was made.
    Head of Agency--The head of the agency is the Department 
Secretary or in the case of DOD, the Secretary of that particular 
military branch. For independent agencies (e.g., NSF, NRC, NASA, 
etc.) the agency head is the highest-ranking member within the 
agency, such as the Director or Administrator.
    Contractor--``Contractor'' is defined under Bayh-Dole as ``any 
person, small business firm, or nonprofit organization that is a 
party to a funding agreement.'' (35 U.S.C 201(c)). Executive Order 
12591 expanded this definition to include ``any business firm 
regardless of size.'' Throughout this document, unless indicated 
otherwise, ``contractor'' may include contractors as well as 
subcontractors and assignees, including inventor(s) or Third Party 
Assignees following agency approval of a request to waive rights.
    Funding Agreement--Any contract, grant, or cooperative agreement 
entered into between any Federal agency, other than the Tennessee 
Valley Authority, and any contractor for the performance of 
experimental, developmental, or research work funded in whole or in 
part by the Federal Government. Such term includes any assignment, 
substitution of parties, or subcontract of any type entered into for 
the performance of experimental, developmental, or research work 
under a funding agreement as herein defined.
    Practical Application--To manufacture in the case of a 
composition or product, to practice in the case of a process or 
method, or to operate in the case of a machine or system; and, in 
each case, under such conditions as to establish that the invention 
is being utilized and that its benefits are to the extent permitted 
by law or Government regulations available to the public on 
reasonable terms.
    Product--Consistent with 35 U.S.C. 204, ``product'' includes 
``any products embodying the subject invention or produced through 
the use of the subject invention.'' For purposes of this framework, 
``product'' may also include a service when that service requires 
the use of the subject invention.
    Shelving--When an entity holds a patent or has a license to 
make, use, or sell an invention, but they do not develop, use, or 
sell that invention (or a product embodying the invention) or seek 
out third parties to do so for an extended period of time.
    Subject Invention--Any invention of the contractor conceived or 
first actually reduced to practice in the performance of work under 
a funding agreement: Provided, that in the case of a variety of 
plant, the date of determination (as defined in section 41(d)[1] of 
the Plant Variety Protection Act (7 U.S.C. 2401(d)) must also occur 
during the period of contract performance. Bayh-Dole governs the 
rights and obligations surrounding subject inventions; therefore, 
only subject inventions are subject to march-in under Bayh-Dole.
    Other terms used throughout this framework should be read 
consistent with the definition within the Bayh-Dole statute and 
regulations (35 U.S.C. 201, 37 CFR 401).

Introduction to March-In Rights & Framework

    Under the University and Small Business Patent Procedures Act of 
1980, more commonly known as the ``Bayh-Dole Act'' or ``Bayh-Dole,'' 
the government allows recipients of federal research funding to 
retain rights to inventions conceived or first actually reduced to 
practice under a federal funding agreement (``subject inventions''). 
The government, however, retains certain rights and imposes certain 
obligations on the contractor, including the authority to ``march-
in.'' March-in allows the agency to require the contractor, or an 
exclusive licensee to grant a license to the subject invention in 
any field of use to a responsible applicant or applicants. If they 
refuse, then the agency may itself grant a license. However, the 
agency can only exercise march-in rights in four specific 
circumstances, the criteria of which are specified in the statute 
(35 U.S.C. 203):
    (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.

[[Page 85596]]

    To date, no agency has exercised its right to march-in. Several 
agencies have considered march-in previously but have either 
declined to exercise it or worked with the parties to find an 
alternative solution to achieve the desired objectives. March-in is 
an important tool for agencies, but that tool is accompanied by 
potentially significant positive and negative ramifications. 
Therefore, in addition to the statutory criteria discussed above, 
the agency should carefully consider all circumstances and 
consequences and ensure that its march-in decision is consistent 
with the policy and objectives of Bayh-Dole. The policy and 
objectives are enumerated in the Bayh-Dole Act at 35 U.S.C. 200:
    It is the policy and objective of the Congress to use the patent 
system to promote the utilization of inventions arising from 
federally supported research or development; to encourage maximum 
participation of small business firms in federally supported 
research and development efforts; to promote collaboration between 
commercial concerns and nonprofit organizations, including 
universities; to ensure that inventions made by nonprofit 
organizations and small business firms are used in a manner to 
promote free competition and enterprise without unduly encumbering 
future research and discovery; to promote the commercialization and 
public availability of inventions made in the United States by 
United States industry and labor; to ensure that the Government 
obtains sufficient rights in federally supported inventions to meet 
the needs of the Government and protect the public against nonuse or 
unreasonable use of inventions; and to minimize the costs of 
administering policies in this area.
    The exercise of march-in rights is just one tool that may be 
available to the government and use of march-in should be considered 
in the context of all tools at the agency's disposal to address 
situations.

Regulatory Procedures for March-In

    If the agency has reason to believe that the exercise of march-
in rights could be warranted (i.e., one of the four criteria appear 
to exist and there is reason to believe that the invention in 
question is subject to Bayh-Dole), then it can initiate the 
procedures for march-in under 37 CFR 401.6.\4\
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    \4\ This represents a summary of the march-in procedures. For a 
full description, see 37 CFR 401.6.
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    First, the agency must notify the contractor in writing of the 
circumstances it believes warrants march-in and request an informal 
consultation and information so that the agency and the contractor 
can understand the nature of the issue and may consider possible 
alternatives to march-in. At the end of this informal consultation, 
the agency will provide written notice to the contractor of its 
decision whether to continue with formal march-in procedures based 
on the available information.
    If the agency decides to move forward with formal march-in 
proceedings, the contractor is permitted to submit information and 
an argument opposing use of march-in. If that submission raises a 
genuine dispute over material facts upon which the march-in is 
based, the head of the agency or his or her designee will undertake 
fact-finding or refer fact-finding to another agency official (the 
``fact-finder''). If the agency proceeds with fact-finding, the 
agency should permit the contractor to appear with counsel, submit 
evidence, present witnesses, and confront witnesses or experts 
presented by the agency.5 6 The fact-finder will then 
prepare or adopt written findings of fact, which will be sent to the 
contractor. The contractor will be given the opportunity to submit 
arguments or, if requested, present oral arguments before the agency 
head or designee makes a decision.
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    \5\ A transcript shall be made and available at cost to the 
contractor, though this requirement can be waived upon agreement by 
the agency and the contractor.
    \6\ All portions of the march-in proceeding are closed to the 
public and are held confidential (35 U.S.C. 202(c)(5)).
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    At this point, the head of the agency or designee will make a 
determination based on the written findings of facts; information 
and arguments submitted by the contractor; any other information in 
the administrative record; and the policy and objectives of the 
Bayh-Dole Act.
    Agencies shall develop an appeals procedure pursuant to 37 CFR 
401.11(c). It is recommended that the appeal be decided by the head 
of the agency or by his or her designee who is at a level above the 
person who made the determination. Additionally, a contractor, 
inventor, assignee, or exclusive licensee adversely affected by a 
march-in decision may appeal that decision in the United States 
Court of Federal Claims (35 U.S.C. 203(b)).

About This Framework

    While the decision to exercise march-in rights lies ultimately 
with the head of the agency or his or her designee, this framework 
details facts the agency may seek and the considerations that the 
agency may use in making these decisions.
    When determining whether to exercise march-in rights, the agency 
may consider a variety of facts but must assess three overarching 
questions: (1) whether Bayh-Dole applies to the invention(s) at 
issue; (2) whether any of the statutory criteria for exercising 
march-in applies under the circumstances; and (3) whether the 
exercise of march-in rights would support the policy and objectives 
of Bayh-Dole. This framework will explore each of these topics in 
more depth and includes some, though not necessarily all, of the 
questions and factors the agency may weigh when considering march-
in.

[[Page 85597]]

[GRAPHIC] [TIFF OMITTED] TN08DE23.032

    When reviewing this framework, it is important to remember that 
march-in considerations are extremely fact-dependent and any 
decision to exercise march-in will be made based on the totality of 
all circumstances. Nothing in this framework should be treated as a 
mandate that an agency exercise its march-in right, as a requirement 
that an agency collect facts to answer every question posed here, or 
as a limitation on the facts and questions an agency can consider. 
Rather, it provides a more comprehensive outline of the factors that 
an agency may weigh when determining whether to exercise march-in 
rights.

Information Gathering

    Much of the information discussed in this framework may be 
easily accessible through records maintained by the agency, such as 
the iEdison system, and agencies should make efforts to compile 
information from these sources when possible.\7\ However, some 
information will need to be obtained through additional searches 
(e.g., the United States Patent and Trademark Office (USPTO) or 
grants and contracts databases), discussions with the contractor, 
information requested from or through the contractor, or other 
means. Some information sought in this framework may not be 
discovered until later steps in the process, and the facts and 
landscape may shift during march-in proceedings. Therefore, it 
should be noted that, if at any time during the process, the agency 
decides that it does not wish to exercise march-in rights, it may 
terminate the proceedings.
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    \7\ iEdison is ``an interagency online reporting system for 
recipients of federal funding agreements to report subject 
inventions to the federal funding agency and complete other 
reporting as required by the Bayh-Dole Act and its implementing 
regulations.'' Available at https://www.nist.gov/iedison.
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    Given that the contractor is responsible for monitoring its 
licensees and exclusive licensees and that the agency only has 
direct relationships with its contractors (as opposed to that 
contractors' licensees, or sub-licensees), the agency will 
correspond and interact with the contractor as it assesses march-in. 
When requesting certain information, the contractor is expected to 
engage with and gather information from its licensees or other 
outside parties as needed. Some information relevant to this 
framework may not be available until later in the process, and the 
facts or underlying circumstances may shift while the agency is 
assessing a march-in request. If at any time during the process, the 
agency decides march-in is not warranted, it may terminate the 
proceedings.

Does Bayh-Dole apply?

    Because Bayh-Dole only governs subject inventions, as a 
threshold consideration, agencies should determine whether a march-
in assessment is directed to a ``subject invention.'' Under Bayh-
Dole, the government cannot march-in and issue licenses to any U.S. 
patent. Government use of march-in rights is limited to these 
inventions funded by the government. In many cases, march-in 
requests are directed to patents that acknowledge government 
funding, and that acknowledgement can be an indication of a subject 
invention. However, whether an invention is a subject invention can 
be a complex and fact-intensive inquiry. For example, some patents 
that acknowledge government funding will not meet the statutory 
definition of a ``subject invention'' (e.g., those under a funding 
agreement made primarily for educational purposes). Agencies 
evaluating march-in may consider these questions in assessing 
government funding for purported subject inventions:
    I. Was the invention(s) in question reported to the government 
as a subject invention(s)? \8\ If there are products at issue, do 
they embody a subject invention or are they produced or performed 
through use of a subject invention?
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    \8\ If an invention is reported to the agency as a subject 
invention, it will be assumed that it is a subject invention. If a 
contractor contends an invention is not a subject invention, then 
they would be given the opportunity to provide evidence to raise 
this as a ``genuine dispute over a material fact'' under 37 CFR 
401.6(3-5).
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    A. What purported subject invention(s) are relevant to this 
march-in analysis? If available, collect the iEdison Invention 
Report Number, Date Reported to Agency, Title Election Status, and 
reported Funding Agreements.\9\
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    \9\ If an invention is funded by multiple agencies, the funding 
agencies should notify one another and attempt to work together to 
come to one unified government determination on whether march-in is 
warranted.
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    B. What patent application(s) and/or patent(s) are associated 
with the subject invention(s)? All available, associated patent 
numbers and patent application numbers should be made part of the 
agency record.
    II. Is this invention an unreported subject invention?
    A. Do unreported patent applications and/or patents covering the 
invention acknowledge federal funding? \10\
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    \10\ Typically, this can be found near the beginning of the 
patent application and/or patent in the specification describing the 
invention.
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    B. Do publication(s) exist that cover the invention? If so, does 
the acknowledgement section(s) reference government funding? \11\ If

[[Page 85598]]

so, what funding agreements were listed as supporting the research 
described in the publication?
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    \11\ Government funding may be listed in an acknowledgment in a 
publication but not contribute to the conception or first actual 
reduction to practice of any invention. (37 CFR 401.1(a)(2)). 
Further analysis may be warranted to determine if an invention is a 
subject invention subject to Bayh-Dole, but references to relevant 
publications can be useful in this analysis.
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    C. Did the contractor receive any funding agreements related to 
the invention and conducted by an inventor listed on the invention 
and/or patents? If available, note all funding agreements for the 
contractor relevant to the subject matter of the invention and work 
done by the relevant inventor.
    D. What are the approved scientific aims under the listed 
funding agreements?
    1. If available, the funding agreement, including the Scope of 
Work which might relate to the subject invention, should be part of 
the agency record.
    Note that the agency may request input from a program manager, 
legal counsel, and/or subject matter expert, and analyze 
publications, patent applications, or issued patents to help 
identify potential overlaps with the scientific aims of a funding 
agreement(s).
    E. Based on the information gathered in this section, can the 
agency confirm whether each invention relevant to the march-in 
assessment was ``conceived or first actually reduced to practice in 
the performance of work under a funding agreement?'' \12\
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    \12\ A contractor or licensee may be given the opportunity to 
dispute a finding that an invention is an unreported subject 
invention by raising it as a ``genuine dispute over the material 
facts'' under 401.6(3-5).
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Ownership and Licensing

    To evaluate march-in, agencies should also determine the 
contractors and licensee(s) that currently have rights to the 
subject invention and are involved in activities like research and 
development (R&D) or manufacturing, marketing, and selling products. 
The march-in assessment will often center on the scope and extent of 
what these parties are doing in an effort to understand the full 
scope of efforts undertaken to practice the subject invention. The 
totality of this information will allow agencies to understand the 
relevant stakeholders and their current actions.
    I. Which owners are listed for each subject invention, patent 
application and/or patent relevant to this march-in analysis in 
USPTO records and other sources?
    II. Which license(s) cover the subject invention, associated 
patent application(s), and/or patent(s)? If available, note which 
subject invention(s), patent application(s), and/or patent(s) are 
covered by each license; whether the license is exclusive or non-
exclusive; and the field of use.

Is a statutory criterion met?

    The statute only authorizes march-in in four statutorily defined 
circumstances (35 U.S.C. 203(a)), therefore, agencies must assess 
whether at least one of these circumstances applies before 
proceeding. To that end, and depending on the details of a march-in 
consideration, agencies may consider some of the following 
questions:
    Criterion 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.
    This criterion focuses on the steps that contractors have taken 
to develop and achieve practical application of the subject 
invention. For example, if a contractor or licensee has stopped 
further work on the subject invention and the contractor and/or 
licensee has refused to restart work and rejects requests to license 
the subject inventions, that could suggest limited opportunities to 
commercialize the subject invention into new products. Stalled 
product development could be an indication of conflict with the 
objectives of the Bayh-Dole Act to encourage utilization and 
commercialization of federally funded inventions. To assess the 
steps contractors and licensees are taking to commercialize these 
subject inventions, agencies should assess if the subject invention 
is licensed and whether there is a product embodying the invention 
on the market. If the contractor has not licensed the invention, or 
if no product exists, agencies may need to further assess whether 
march-in is warranted.
    If the contractor or licensee has commercialized the product, 
but the price or other terms at which the product is currently 
offered to the public are not reasonable, agencies may need to 
further assess whether march-in is warranted. Whether action may be 
needed to meet the needs of the Government or protect the public 
against nonuse or unreasonable use of the subject invention may 
include consideration of factors that unreasonably limit 
availability of the invention to the public, including the 
reasonableness of the price and other terms at which the product is 
made available to end-users.
    Agencies may also consider the circumstances surrounding the 
patent status, any licenses and/or offers to license, and the 
products themselves--however, some of those issues may be better 
addressed through other statutory march-in criteria, other 
provisions in the Bayh-Dole Act, or different government 
authorities.
    It should be noted that given the nature of this criterion, the 
questions the agency asks may vary depending on the stage of 
development as well as whether the contractor is licensing the 
technology for development and commercialization or intends to 
develop and commercialize the resulting product directly.
    I. When determining whether to exercise march-in under this 
criterion, the agency will first assess which of the following 
categories best describes the current stage of development for the 
subject inventions and/or products and answer the corresponding 
questions.
    A. The subject invention is not licensed, and the contractor has 
no plans to develop or commercialize, itself. Complete Section II.
    B. The subject invention is licensed, or the contractor is 
developing the subject invention with plans to directly 
commercialize it. Complete Section III.
    C. The product is commercialized. Complete Section IV.
    II. In considering whether this criterion 1 applies to a subject 
invention that is not licensed and the contractor has no plans to 
develop or commercialize itself, the agency may assess:
    A. What actions has the contractor taken to license the subject 
invention (for example, is it evaluating licensing offers, or 
seeking out interested licensees)?
    B. Have the contractor and any potential licensee(s) reached 
mutually agreeable license terms?
    1. If yes, then why is the subject invention not licensed?
    2. If no, has the contractor offered to license the subject 
invention under commercially reasonable terms? Are there companies 
that want to license but the contractor will not agree to terms 
offered?
    C. Is there an indication the contractor would decline to 
license the subject invention even if a potential, responsible 
license applicant was presented?
    D. Is there a valid reason (technical, legal, or otherwise) that 
explains why the contractor has stopped licensing efforts? What is 
that reason?
    E. Are there concerns about the contractor shelving the subject 
invention(s) without justification and not committing to discernable 
steps on re-engaging in its licensing?
    III. In considering whether this criterion 1 applies to a 
licensed subject invention or a subject invention that is being 
developed or commercialized by the contractor, the agency may 
assess:
    A. What steps are needed to bring the product to market? Is the 
contractor or the licensee taking these steps or planning to take 
these steps within a reasonable timeframe?
    1. If the invention is licensed but the licensee is not taking 
steps to bring it to market, has the contractor attempted to address 
the matter with the licensee? Are there appropriate product 
development milestones in the License Agreement? Are there unmet 
milestones the contractor could enforce? If not, are there other 
steps the contractor can take under the terms of the license to 
ensure development?
    2. What is the degree of investment, time, and regulatory 
requirements needed to bring the product to market?
    B. Is regulatory approval needed or pending?
    1. If yes, is the contractor and/or licensee seeking regulatory 
approval? If approval was denied, what were the reasons and will 
further approval be sought, for example after additional data is 
collected?
    C. If the licensee or contractor is not intending to manufacture 
the product, have they identified manufacturers?
    1. If a potential manufacturer(s) has been identified, have the 
manufacturer and contractor(s)/licensee(s) reached mutually 
agreeable license terms?
    a. If yes, when will manufacturing begin?
    b. If no, has the contractor(s)/licensee(s) offered to license 
the subject invention for manufacturing under commercially 
reasonable terms? Are there manufacturers who desire a license, but 
the contractor(s)/licensee(s) has not agreed to terms offered?
    2. If a potential manufacturer has not been identified, what 
actions has the contractor(s)

[[Page 85599]]

or licensee(s) taken to identify potential manufacturers?
    D. Is there a valid reason (technical, legal, or otherwise) that 
explains why the contractor or licensee has stopped development or 
commercialization efforts? What is that reason?
    E. Are there concerns about the contractor or licensee shelving 
the subject invention(s) without justification and not committing to 
discernable steps on re-engaging in its development?
    VI. In considering whether this criterion 1 applies to a product 
that is being commercialized, the agency may assess:
    A. Is the contractor or licensee marketing or selling to end-
users or consumers in the U.S.? If not, why?
    B. Has the product utilizing the subject invention been sold or 
offered for sale in the U.S. using distribution channels (e.g., 
retailer, wholesaler, through a regulated intermediary, or direct to 
consumer) used for similar products?
    C. How does the availability of the product benefit the public, 
and how is the public harmed by limited availability of the product?
    D. At what price and on what terms has the product utilizing the 
subject invention been sold or offered for sale in the U.S.?
    a. Has the contractor or licensee made the product available 
only to a narrow set of consumers or customers because of high 
pricing or other extenuating factors? Has the contractor or licensee 
provided any justification for the product's price or background on 
any extenuating factors which might be unreasonably limiting 
availability of the subject invention to consumers or customers?
    Criterion 2. Action is necessary to alleviate health or safety 
needs which are not reasonably satisfied by the contractor, 
assignee, or their licensees.
    In considering march-in based on criterion 2, agencies will seek 
a clear picture of the health or safety need that is not being 
reasonably satisfied. The agencies can also assess what it would 
take to better or fully meet the need and will evaluate how march-in 
could address the health or safety need.
    I. What is the health or safety need to be addressed? What is 
the scope of the health or safety need? How long is the health or 
safety need anticipated to last?
    II. Has the agency consulted with other agencies resulting in 
agreement on unmet health or safety needs and/or other necessary 
actions?
    III. How does the subject invention or the product at issue 
address the unmet health or safety need?
    IV. What is necessary to resolve the health or safety need?
    A. Greater quantity or quality of a specific product?
    B. Different or additional ways to access the product?
    C. More options to access similar, but not identical, products? 
(For example, if the contractor manufactures one dosage of a drug 
but a new use is identified that requires a much lower or higher 
dosage).
    D. Greater access through additional uses of another existing 
product?
    V. Is the contractor or the licensee exploiting a health or 
safety need in order to set a product price that is extreme and 
unjustified given the totality of circumstances?
    A. For example, has the contractor or licensee implemented a 
sudden, steep price increase in response to a disaster that is 
putting people's health at risk?
    It should be noted that in reviewing this question, the agency 
is not limited to reviewing price increases; the initial price may 
also be considered if it appears that the price is extreme, 
unjustified, and exploitative of a health or safety need.
    VI. How would march-in address the health or safety need? Are 
there other products, or other potential alternatives to march-in, 
that would address the health or safety need, in whole or in part?
    VII. Has the contractor been consulted about options, short of 
march-in, to address the unmet need?
    Criterion 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.
    Under criterion 3, agencies will evaluate whether any Federal 
regulations relate to the use of products commercialized from the 
subject invention. They will assess whether the contractor(s) and/or 
licensee(s) have taken reasonable steps to address any needs related 
to these Federal regulations, including making the subject invention 
available to all who require it.
    I. Does a Federal regulation expressly require the subject 
invention to be used in or in combination with another product (if 
the subject invention is commercially available)? If a Federal 
regulation does not expressly require such use, does a Federal 
regulation in practice effectively require the use of the subject 
invention in order to satisfy a regulatory requirement?
    II. Is the subject invention already available to those who 
require it under the regulation?
    A. If not, is there evidence that the contractor(s) or 
licensee(s) is restricting access or imposing barriers to access?
    III. How does the subject invention address the need?
    IV. Do other current technologies address the issue? If so, what 
are those technologies?
    V. Has the contractor contacted the agency that issued the 
regulation for assistance?
    VI. How much time is required to meet public use requirements by 
Federal regulation?
    VII. Has the contractor been specifically consulted about 
addressing the public use requirement?
    Criterion 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.
    This criterion relates to 35 U.S.C. 204 and requires that 
exclusive licenses to use or sell in the U.S. include an agreement 
that products embodying subject inventions be manufactured 
substantially in the U.S.\13\ The requirement for such an agreement 
may be waived by the agency under whose funding agreement the 
invention was made upon a showing by the small business firm, 
nonprofit organization, or assignee that reasonable but unsuccessful 
efforts have been made to grant licenses on similar terms to 
potential licensees that would be likely to manufacture 
substantially in the U.S. or that under the circumstances domestic 
manufacture is not commercially feasible. Broadly, agencies will 
evaluate if Sec.  204 applies, request specific details on where any 
products are being manufactured, and determine if a manufacturing 
waiver is required and if a request to waive the preference for U.S. 
industry has been granted.
---------------------------------------------------------------------------

    \13\ Pursuant to 35 U.S.C 202(a)(ii) some agencies may have 
issued Determinations of Exceptional Circumstances (DECs) amending 
the standard patent rights clauses of their funding agreements to 
include broader domestic manufacturing obligations than those 
enumerated in 35 U.S.C. 204. Agencies who have issued such DECs 
should refer to those DECs to determine the extent of the 
government's rights when contractors are noncompliant with the 
manufacturing obligations under the DEC. For example, DOE's 
``DETERMINATION OF EXCEPTIONAL CIRCUMSTANCES UNDER THE BAYH-DOLE ACT 
TO FURTHER PROMOTE DOMESTIC MANUFACTURE OF DOE SCIENCE AND ENERGY 
TECHNOLOGIES'' does not specify any government march-in rights, but 
requires contractors to ``convey to DOE, upon written request from 
DOE, title to any subject invention, upon a breach'' of their U.S. 
Competitiveness provision.
---------------------------------------------------------------------------

    I. Are the prerequisites triggering the agreement required under 
section 204 present?
    A. Has the contractor granted an exclusive license to use or 
sell any subject invention in the United States?
    II. Did the contractor's exclusive license agreement require 
that any products embodying the subject invention or produced 
through the use of the subject invention be manufactured 
substantially in the U.S.?
    A. If no, can the agreement be amended to incorporate the 
agreement required by section 204?
    B. If no, was a request for waiver of the preference for U.S. 
industry submitted to the agency(ies)? Was the request granted and 
under what terms?
    III. Are products embodying the subject invention or produced 
through the use of the subject invention being manufactured under 
that exclusive license?
    A. If yes, in what countries are those products being 
manufactured?
    B. Taking the manufacturing locations of all components of the 
product into consideration, would the product be considered to have 
been manufactured substantially in the U.S.?
    IV. If the answers to II and/or III above are no, was a request 
for waiver of the preference for U.S. industry submitted to the 
agency(ies)?
    A. If yes, was the waiver request granted?
    1. If so, what were the terms of the waiver (subject inventions 
covered, duration, countries or facilities wherein products can be 
manufactured, field of use, etc.)?
    2. If the waiver request was submitted but denied, why was it 
denied?

[[Page 85600]]

    B. If no, has the agency contacted the contractor under its 
enforcement authorities of the terms and conditions of the funding 
agreement to demand that a waiver request be submitted?

Would march-in support the policy & objective of Bayh-Dole, considering 
the specific case and broader context?

    The Bayh-Dole regulations under 37 CFR 401.6(a)(6) state that 
``[t]he consistency of the exercise of march-in rights with the 
policy and objectives of 35 U.S.C. 200 shall also be considered. The 
Bayh-Dole Act emphasizes ``utilization of inventions arising from 
federally funded research and development'' and the 
``commercialization and public availability of'' those inventions. 
The foundation of Bayh-Dole's policies and objectives reflect two 
themes (among others): promoting the development of new products in 
the U.S. and their availability to end-users or consumers in the 
U.S. Accordingly, agencies evaluating march-in should prioritize 
both policy goals--incentivizing U.S. innovation and promoting 
access to the fruits of that innovation in the U.S. Determining 
whether an individual march-in decision would advance or impede 
these goals may be a complex and fact-specific assessment. Agencies 
should also weigh how an individual march-in decision could impact 
the broader policy objectives for U.S. competitiveness and 
innovation.
    I. Would march-in help achieve practical application, alleviate 
health or safety needs, meet public use requirements, or meet 
manufacturing requirements?
    This section of the framework is intended to inform the agency's 
assessment of the practical value of exercising march-in, 
specifically in terms of increasing accessibility of the subject 
invention(s)--what would happen if a contractor, licensee, or the 
agency issued (or tried to issue) a new license(s) to the subject 
invention(s)? How likely is it that march-in would solve the problem 
identified by those seeking it? Could other interested and willing 
licensees practice the subject invention in sufficient time to 
address the problem? An absence of other interested licensees could 
weigh against march-in. Agencies may also need to consider whether 
there is intellectual property (beyond the subject invention(s)) 
that could possibly prevent other licensees from making the product 
or offering the service in question. A complicated intellectual 
property landscape could reduce the likelihood of successful 
licensing and weigh against march-in. To that end, agencies 
reviewing march-in may ask some of these questions:
    A. Is there another willing and able licensee or is it likely 
that one could be found?
    1. How long would it take another licensee(s) to start producing 
and marketing the covered product? How long would it take before 
another licensee(s) could satisfy existing demand for the product? 
At what price would another licensee(s) be able to make the product 
available to the public?
    2. What steps, if any, could or should the agency or the 
existing contractor(s) take to identify other willing licensee(s) 
under the circumstances?
    B. What intellectual property, in total, is needed to make the 
product in question? Does making the product or performing the 
service also require use of intellectual property that was not 
government funded and is not subject to Bayh-Dole?
    1. For example, if only one of several patents necessary to 
produce a product is subject to march-in, that likely weighs against 
march-in, since other licensees would need separate permission to 
use several other patents before they could make the product. On the 
other hand, if all the intellectual property needed to produce the 
product is a subject invention(s), that might result in a different 
licensee being able to produce product quickly or efficiently.
    C. When do the patents subject to the march-in evaluation 
expire?
    1. Will the patents expire before the march-in process is 
completed and another licensee is able to bring a product to market? 
Consider the remaining patent life in relation to the timeline for 
march-in proceedings, federal court appeals, transfer of know-how 
and build out of product manufacturing capability, and/or any 
necessary regulatory approvals. If the patent term is likely to end 
before the march-in process concludes and before a new licensee 
could bring a product to market, these factors weigh against a 
decision to exercise march-in rights.
    D. Is the product or service subject to regulatory exclusivity, 
such as those provided by the FDA? If so, how much time remains in 
the period of exclusivity?
    E. If march-in is requested in response to an emergency or an 
urgent public health or safety issue--how long is the emergency or 
issue expected to last? Consider if the march-in process would take 
longer than the emergency is expected to last, as that could weigh 
against march-in.
    F. If march-in is requested based on the criterion of domestic 
manufacturing--
    1. Is the contractor willing to submit a request to waive the 
preference for U.S. industry? Consider whether the agency would 
grant a waiver, if requested.
    G. Would a determination to march-in promote utilization of this 
subject invention? Would it protect the public against non-use or 
unreasonable use of this subject invention?
    1. Would march-in have an impact on public availability of the 
benefit of the invention in the short and long-term?
    The situation and pertinent facts may evolve with time. Agencies 
may revisit these questions--e.g., whether there is another willing 
and able licensee--and defer a march-in determination in the event 
appropriate licensees emerge. Another possible circumstance that 
could affect march-in analysis includes another product coming to 
market during the pendency of the march-in process that displaces 
the market for product that is the subject of march-in.
    II. Are there other ways to address the identified problem, and 
can those alternatives be pursued instead of or in parallel with any 
march-in proceedings?
    During review of march-in, more expeditious resolutions may be 
identified, and agencies should weigh viable alternatives when 
making march-in decisions. However, just because there may be 
alternative resolutions to the problem that prompted march-in 
consideration, that does not mean exercise of march-in rights is 
inappropriate.
    A. Are there other alternatives available to address the problem 
identified? How effective are the alternatives (or how likely is it 
that other alternatives would solve the problem), and how effective 
are the alternatives in comparison to march-in?
    B. If the subject invention is licensed, what efforts have or 
can the contractor(s) and/or licensee(s) take to solve the problem?
    C. Are the contractor and its licensee(s) willing to take action 
to remedy the matter without the agency exercising march-in?
    D. Is there a problem such as anti-trust activity, fraud, or 
bankruptcy, that would be best addressed by other federal or state 
governmental authorities?
    E. Is there patent litigation pending or other legal actions or 
concerns regarding the patents associated with the subject 
invention? Consider whether other legal processes (e.g., a challenge 
to the validity of the patent, licenses being revoked) may allow 
another manufacturer to bring the product to market more quickly, as 
that could weigh against use of march-in.
    F. Is there another federal agency taking action that would 
resolve underlying issues without the use of march-in?
    III. What are the wider implications of use of march-in?
    At its core, the Bayh-Dole Act focuses on U.S. innovation and 
the commercialization of inventions that arise from federally funded 
R&D--all with an eye towards advancing the interests of the American 
public. Prior to exercising march-in, funding agencies should 
consider both the practical impact and the potential impact on the 
broader R&D ecosystem. To that end, agencies may consider questions 
such as:
    A. Would march-in protect the public against nonuse or 
unreasonable use of subject inventions?
    1. Consider ways to ensure that any use of march-in achieves the 
intended outcomes and does not have broad and unintended 
consequences on U.S. competitiveness and innovation.
    2. Consider whether march-in would send a clear signal to 
industry so other contractors and licensees can rely on that 
agency's prior decisions to avoid similar issues in the future.
    B. Consider whether march-in would increase public availability 
of federally funded inventions and foster support for the federal 
research enterprise.
    C. Would exercise of march-in rights here promote competition 
without unduly encumbering future R&D? Would it impact competition 
and R&D more broadly? For example, would there be a decrease in the 
number of applicants for federal funding?
    D. Would exercise of march-in impact utilization of subject 
inventions more broadly?
    1. Would march-in have an impact on U.S. competitiveness and 
innovation?
    2. Would prospective licensees likely avoid future 
collaborations with federally funded research institutions, 
organizations, small businesses, and investigators? For example,

[[Page 85601]]

would there be a decline in the number of collaborations with the 
federal laboratory? Would an agency's practice result in a decline 
in the number of collaborations? Agencies may answer both questions 
post facto, and cannot be predicted. However, if an agency has had a 
similar effort that had impacted the number or quality of 
collaborators, they could extrapolate the effect. Agencies should 
consider the potential chilling effect on the agencies' existing 
relationships with industry and ability to address Administration 
priorities.
    E. Consider whether input from other agencies would be helpful 
to understand the ramifications of a march-in decision, e.g., the 
State Department, Office of the U.S. Trade Representative, or 
Department of Commerce as to any diplomatic or trade implications or 
the United States Patent and Trademark Office as to any intellectual 
property implications.

Scenarios & Examples

    This section of the framework presents a variety of hypothetical 
scenarios where march-in could emerge. These examples and the 
subsequent discussion showcase how an agency might apply this 
framework, considering certain factors and questions, in assessing 
march-in.
    In an actual march-in analysis, an agency would consider the 
relevant facts and questions, explore the relevant Bayh-Dole 
statutory march-in criteria, and evaluate any feasible alternatives 
before making a determination of whether to exercise march-in. 
However, for clarity and brevity, when discussing these scenarios, 
please assume the following:
    1. The agency establishes or has established that Bayh-Dole 
applies to the subject invention(s).
    2. Only Bayh-Dole subject inventions are needed to successfully 
manufacture the product (i.e., no additional intellectual property 
licensing would be needed).
    3. Although the agency considers the relevant factors and 
answers relevant questions within the framework, only one criterion 
and certain illustrative facts and circumstances may be addressed in 
the discussion of each scenario.
    These scenarios are hypothetical and should not be read or 
inferred to reference a particular invention, product, contractor, 
or licensee. Further, nothing in the discussions of these scenarios 
should be interpreted as an obligation upon the agency to exercise 
march-in. As stated previously, march-in decisions are extremely 
fact-dependent and the agency would consider the totality of 
circumstances in a real-life situation, whereas these scenarios only 
address select issues.

Scenario 1

    Background: A biotech company has partnered with a U.S. 
government-funded university to develop treatments for autoimmune 
skin diseases. The company was granted an exclusive license to a 
government-funded patent owned by the university. The patent claims 
a new compound that has shown promise in pre-clinical trials for 
psoriasis. The company has also separately developed another 
psoriasis treatment and that second treatment--which recently 
received FDA approval--was developed solely by the company without 
any government support. Once the company secured FDA approval for 
that second treatment, it appears to have stopped all work on the 
patented compound that was invented by the government-funded 
university. A second company has approached both parties for a 
license to the university-owned patent, but its request was denied, 
so the second company has asked the government funding agency to 
march-in and require the university to grant it a license to the 
university patent.
    Discussion:
    Statutory Criteria--In this scenario, it appears the contractor 
and licensee may not be taking effective steps to achieve practical 
application of the subject invention in such field of use (Statutory 
Criterion 1). Before proceeding, the agency would seek information 
from the contractor to confirm whether the current licensee has in 
fact stopped development of the subject invention. If so, the agency 
would continue this inquiry to determine if the licensee is 
inappropriately shelving the technology.
    To make this determination, the agency would explore the 
questions detailed in Statutorily Defined March-In Criteria; 
Criterion 1; Section III. It appears the licensee might have ceased 
development of the subject invention in favor of another competing 
technology (Statutorily Defined March-in Criteria, Criterion 1, III, 
A). The agency would then ask whether there was a valid, technical 
reason that the licensee stopped development (Section III, B). For 
example, if the licensee obtained poor results in clinical trials, 
that could justify halting work and weigh against march-in. However, 
the fact that there is another interested licensee suggests the 
subject invention holds clinical promise, and that could weigh in 
favor of march-in.
    The agency would also ask whether the contractor has taken steps 
to remedy this situation and whether the contractor's agreement with 
the licensee includes milestones or other diligence provisions that 
would allow the contractor to terminate the license and ``clawback'' 
the technology. If the contractor intends to enforce ``clawback'' 
provisions to terminate the license and seek other licensees, or if 
it intends to enforce milestones within the license to push further 
development of the university-patented invention, these factors 
could weigh against march-in. If the license in question did not 
contain such provisions or the contractor was unwilling to exercise 
its rights, then these circumstances could weigh in favor of march-
in.
    Policy & Objectives of Bayh-Dole--As part of this analysis, the 
agency would also look at whether exercising march-in rights would 
achieve the desired outcome and support the policy and objectives of 
Bayh-Dole. First, the agency would consider whether march-in would 
promote utilization and protect against non-use of this subject 
invention (Would March-In Support the Policy & Objective of Bayh-
Dole; Section I). Here, the agency would analyze whether the second 
company that sought a license pursuant to march-in was a reasonable 
applicant (Section I, E). In other words, would that company be 
capable of bringing the product to market? If a viable and qualified 
company was interested in restarting development work but being 
denied the opportunity, that would weigh in favor of march-in. 
However, if that second company, on its face, lacked any of the 
experience or resources necessary to bring a new psoriasis treatment 
to market--and if the agency was unlikely to find another qualified 
and interested licensee (for example, because the product failed 
clinical trials)--these factors and circumstances would weigh 
against march-in. The agency would also look at timing factors, like 
the remaining patent life compared to the time required to complete 
march-in proceedings, exhaust appeals, and further develop the 
technology--as a short remaining patent term could weigh against 
march-in (Section I, B, 1). Second, the agency would consider 
whether there are viable alternatives (Section II), like the 
contractor clawing-back the existing license and issuing one to a 
new developer. Finally, the agency would assess the wider 
implications of exercising march-in (Section III). This would depend 
in large part on further factual development referenced above. But 
if there is a valid reason why this licensee stopped work, then 
march-in here seems unlikely to advance the goals of Bayh-Dole. But 
if this is a case of a licensee is impermissibly shelving a subject 
invention to preserve the market position of a competing product, 
march-in here could deter similar actions by others in the future.

Scenario 2

    Background: An advanced manufacturing startup that received 
Phase I and Phase II SBIR grants is working on improved 3-D printing 
technology for construction materials. The startup is regularly 
attending conferences and showcasing its prototypes and it recently 
closed a successful Series A funding round with several venture 
investors who have a history of success in the relevant markets. But 
it has been several years since the startup launched and it is not 
yet offering a commercial product or service. The startup also holds 
a portfolio of five government-funded patents directed to its 
technology. A large, established construction company is looking to 
launch a 3-D printing initiative and it has asked the government 
funding agency to march-in and grant it a license to the startup's 
patent portfolio. The established construction company claims the 
startup is impermissibly shelving the subject invention by not 
launching a product or service, yet, and the established company 
contends it has the resources and funding on hand to bring this 
technology to market quickly--making it a preferred licensee.
    Discussion:
    Statutory Criteria--In this scenario, it appears the contractor 
is taking steps to achieve practical application of the subject 
invention (Statutorily Criterion 1). The agency would likely start 
its analysis by discussing the contractor's plans to develop or 
license the invention (Statutorily Defined March-in Criteria, 
Criterion 1, I-III). Here, the contractor seems to be actively 
developing

[[Page 85602]]

the technology and preparing to market it in at least one field of 
use. It has recently raised additional funds that would support 
further development and product launch. The mere fact that a 
potential competitor might be able to bring a subject invention to 
market more quickly than the contractor does not mean the contractor 
is impermissibly shelving a subject invention. On the other hand, if 
there are indications that the startup is delayed because it is 
devoting all its resources to develop to unrelated technology, that 
could weigh in favor of march-in. The agency may also monitor the 
continued progress of the contractor in developing this technology 
to improve construction material manufacturing.
    Policy & Objectives of Bayh-Dole--The first part of this 
analysis looks at whether march-in would promote utilization and 
protect against shelving or non-use of this invention (Would March-
in Support the Policy & Objective of Bayh-Dole; Section I). Here, it 
appears the contractor is still actively developing this technology 
and not shelving it, which would weigh against march-in, even though 
other licensees might also be able to bring this technology to 
market. The agency may also consider if there are other steps it, or 
the contractor, could take to speed development--if that is 
warranted (Section II). Finally, the agency may consider the wider 
implications of exercising march-in (Section III). For example, the 
Bayh-Dole Act includes the objective of ``encourage[ing] maximum 
participation of small business firms in federally supported 
research and development efforts.'' March-in here could deter future 
small businesses from engaging in federally supported R&D, if they 
thought larger competitors would be able to easily leverage march-in 
requests to step in and take over development and commercialization.

Scenario 3

    Background: The Federal Highway Safety Administration has 
identified a growing safety concern in which traffic accidents have 
risen 27% due in large part to drivers' inability to see traffic 
signs early enough to act accordingly. Having evaluated the growing 
number of incidents, it has been determined that the issue is the 
visibility of the traffic signs in lighting extremes (glare from 
bright sunshine during the day or lack of visibility of the signage 
during low light hours). Subject to a grant provided by the 
government, a contractor has developed a new retroreflective coating 
for traffic signs that improves the visibility of the signs by as 
much as 75% both during bright daylight without glare and at night 
by enhancing the indirect reflection of automobile headlights off 
the signage. The contractor is a medium-sized company that is 
seeking to grow, based on this new patented technology, but they are 
unable to keep up with demand for their new material from signage 
manufacturers who are receiving significant increases in demand from 
state Departments of Transportation (DOTs) seeking to improve or 
replace their signage. To date the contractor has only agreed to 
license its patent to one sign manufacturer. Others have sought 
licenses and been rejected. Several manufacturers have approached 
the government funding agency seeking assistance in licensing the 
patented material to manufacture and incorporate the material into 
the signs they sell to the state DOTs.
    Discussion:
    Statutory Criteria--First, the agency would investigate the 
scope of the unmet health and safety need and how this subject 
invention addresses that need (Statutorily Defined March-In 
Criteria; Criterion 2; Sections I-III). Based on this fact pattern, 
it seems more of the retroreflective coating product is needed to 
satisfy an unmet safety need (Section IV) and it could significantly 
impact, though not completely alleviate, the safety concerns 
(Section V). The agency may, for example, seek additional data to 
understand how much the new coating has actually improved safety and 
how many accidents have been prevented due to use of this coating. 
If there is strong evidence of a steep drop in accidents, that could 
weigh more in favor of march-in. However, if there's not yet 
sufficient evidence that the improved visibility is positively 
impacting driver safety, march-in may at the very least be 
premature. The agency would also consult with the contractor and 
gather additional information as to why it has been denying licenses 
(Section VI). Perhaps the contractor has a valid reason, e.g., 
limited worldwide access to necessary raw materials, or it may have 
a concrete plan to increase production in the near future; these 
factors could weigh against march-in. Likewise, the contractor and 
the agency may be able to work out a plan or timeline for addressing 
the safety need without march-in. However, if the contractor cannot 
present a rationale to refuse more licenses and it has no 
discernable plan to meet increasing demand, then that could weigh in 
favor of march-in.
    Policy & Objectives of Bayh-Dole--The agency would also need to 
determine whether march-in would alleviate the health or safety need 
(Would March-In Support the Policy & Objective of Bayh-Dole; Section 
I). In this case, the answer likely depends on the further factual 
development referenced above. For example, if the raw materials 
necessary to make this new coating are in very short supply--and the 
contractor is already using all the available raw materials--then 
march-in would be unlikely to alleviate the health or safety need by 
increasing coating production. The agency would also consider the 
relevant timelines (Section I, C). For example, if the contactor 
would be able to satisfy all outstanding state DOT orders within the 
year and march-in proceedings are likely to take longer, that would 
weigh against march-in. The agency would also explore other 
alternatives to address traffic safety in parallel (Section II, A). 
For example, are there other products that could support the market 
need while the contractor increases its production capacity? 
Alternatives need not be superior to the subject invention to be a 
consideration weighing against march-in. Finally, the agency would 
consider the wider implications of march-in. For example, would 
march-in here deter smaller or medium sized businesses from 
commercializing subject inventions, out of fear that they would lose 
exclusivity or patent protection to larger companies with more 
capacity (Section III, B-C)?

Scenario 4

    Background: A small pharmaceutical startup that has received 
extensive government funding developed a monoclonal antibody that 
currently is the only treatment for a rare disease. That company 
holds all of the patents covering the antibody, its use, and the 
methods of manufacturing--and each of those patents contains a 
clause acknowledging government funding as required by the 
regulations. The startup does all its manufacturing at a plant in 
California, and severe rainfall caused substantial flooding that 
compromised the manufacturing plant. The plant will need substantial 
repairs, and it is unclear if and when the company will be able to 
resume production. Even if the company can resume production, it 
will take four months after the repairs to complete manufacturing a 
batch of the antibody. A rare disease patient group has asked the 
government to march-in and issue licenses to all of the patents 
necessary to make and use the antibody.
    Discussion: Given the urgent need, march-in would be among a 
range of options the agency would likely consider for resolving this 
problem and promptly getting treatment into the hands of patients.
    Statutory Criteria--In this scenario, it appears there may be 
health needs that are not being reasonably satisfied by the 
contractor (Statutory Criterion 2). The agency would first ask the 
contractor for information to confirm the basic facts--that the 
company has ceased manufacturing the treatment in question due to 
flooding and return to operations is uncertain. If that is the case, 
the agency would continue its inquiry to assess whether march-in 
would alleviate the unmet health need, exploring questions detailed 
in Statutorily Defined March-In Criteria; Criterion 2. In this 
scenario, more treatment for this rare disease is needed (Section 
III; IV,A).
    From there, the agency would likely need more information to 
assess whether march-in could feasibly address the problem. For 
example, does the contractor have a back-up plan for manufacturing, 
and if so, how long would it be before the contractor can start 
delivering treatment to patients (Section VI)? If there's no back-up 
plan, that could weigh in favor of march-in. Likewise, the lack of 
clarity about if and when the contractor will resume manufacturing 
suggests a potentially prolonged unmet health need, which could also 
weigh in favor of march-in (Section VII). The agency would also 
consider whether there are other manufacturers--``responsible 
applicants''--that could quickly manufacture this (or another) 
product with FDA approval to treat the rare disease. If yes, then 
march-in might help address the health need; but, if no other 
manufacturers are willing to make the product in question or utilize 
the subject invention, then march-in may not provide a solution 
(Section V).
    Policy & Objectives of Bayh-Dole--As part of this analysis, the 
agency would also look at whether exercising march-in would achieve 
the desired outcome and support the policy and objectives of Bayh-
Dole (Would

[[Page 85603]]

March-In Support The Policy & Objective Of Bayh-Dole; Section I). 
The agency would likely focus on whether there are other responsible 
applicants interested in manufacturing the product in question or 
practicing the subject invention to treat the rare disease (Section 
I, E). The agency would also look at timing considerations like the 
remaining term of the relevant patents, the time required for any 
regulatory approvals of new products or manufacturing facilities, 
and the potential length of a march-in proceeding and any appeals. 
Very lengthy timelines could weigh against march-in and towards more 
expeditious solutions. If all of the patents involved in making this 
treatment are subject inventions, that could weigh in favor of 
march-in as it is less likely other intellectual property would 
stand in the way of other manufacturers (Section I, B; II). Finally, 
the manufacturing problems in this scenario seem largely outside of 
the contractor's control. That suggests march-in would be unlikely 
to resolve non-use or unreasonable use of subject inventions in the 
future, although it could deter other future collaborators from 
developing subject inventions, weighing against march-in (Section 
III).

Scenario 5

    Background: A water filtration company has an exclusive license 
from a government-funded university to patents covering a subject 
invention for point-of-use water purification technology. The 
company manufactures a small device, which can be used to remove 
organic contaminants like pesticides in households that get their 
drinking water from wells. Ten years ago, a certain pesticide became 
very popular because it was safe for native U.S. pollinators but 
effective at combatting an invasive beetle destroying crops 
nationwide. But recent studies have shown a ten-fold increase in 
pediatric cancers that is connected to drinking groundwater 
contaminated with that pesticide. The water filtration company's 
point-of-use purification device is uniquely able to remove even 
trace amounts of that pesticide. As a result, demand has spiked. 
However, the company has not increased its manufacturing pace, so 
the price of the devices has jumped 1000% in the past three months. 
The combination of the limited supply and increased prices has 
resulted in a health emergency that cannot be adequately addressed 
without expanding capacity. Three other manufacturers and a dozen 
rural community groups have asked the government funding agency to 
march-in and issue licenses to increase supply and reduce cost of 
the specialized filters.
    Discussion: Given the pressing need, march-in would be among a 
range of options the agency would likely consider for resolving this 
problem promptly and protecting children.
    Statutory Criteria--In this scenario, it appears that march-in 
may alleviate a health or safety need that, at this time, is not 
reasonably being satisfied by the contractor or its licensee 
(Statutory Criterion 2). First, the agency would seek to confirm 
underlying information, including about the health or safety need. 
For example, the agency would consult with experts and appropriate 
agencies, seek available information about how the pesticide 
contributes to pediatric cancer, and investigate how (and how 
effectively) this purification device removes the pesticide 
(Statutorily Defined March-In Criteria; Criterion 2; Sections I-
III). The agency would also confirm basic facts with the contractor, 
including whether it is refusing to ramp up manufacturing and how 
much the price has increased. All of this would be with an eye 
toward mitigating the risk of pediatric cancer, which in this 
scenario would appear to require an increased supply and accessible 
filtration devices (Section IV). The agency would likely assess 
whether the contractor is in fact exploiting the health or safety 
need to set a product price that is egregious within the U.S. market 
and unjustified given the totality of circumstances (Section IV, E). 
If the evidence suggests this 1000% increase was an intentional act 
by the company to ``cash-in'' on this newly discovered health and 
safety need, that would weigh in favor of march-in. However, if the 
entire market has seen similar price increases and there is a 
compelling justification for such a high price, e.g., a shortage of 
essential raw materials is making increased production impossible, 
that would weigh against march-in.
    Policy & Objectives of Bayh-Dole--The agency would similarly 
need to assess the practical impact of march-in on the unmet need 
and carefully evaluate all alternatives (Would March-In Support the 
Policy & Objective of Bayh-Dole). For example, if the pesticide 
stays in the water supply long term and there's no indication other 
solutions will become available very soon, that would weigh in favor 
of march-in. If farmers are no longer using the pesticide in 
question and it dissipates quickly, then the demand for filters 
could subside soon, weighing against march-in. Additionally, the 
fact that there are already other interested manufacturers suggests 
march-in could increase production by these entities soon, weighing 
in favor of march-in. However, the agency would need to examine the 
capability of the prospective licensees and manufacturers and be 
comfortable these are ``reasonable applicants'' that could get a 
product to market (Section I, E). Here again, the agency would also 
consider possible alternatives, like other technologies to protect 
children (Section II). For example, perhaps another agency has 
already banned the pesticide and that, combined with an alternative 
filtration technology, could bring the pesticide levels to a safe 
percentage within the year, weighing against march-in. Finally, the 
agency would analyze the wider implications of march-in to ensure 
consistency with Bayh-Dole policy and objectives (Section III). The 
agency may determine that exercising march-in rights would have a 
meaningful positive impact on child health, increase confidence that 
federally funded inventions are available to improve the lives of 
Americans, result in increased competition, and set an example of 
actions by contractors or licensees that are ``off limits.'' The 
agency may determine those factors outweigh any negative impacts on 
investments in future federal R&D, given the apparent bad-faith 
actions of the contractor (Sections III, A, 2; III, 3).

Scenario 6

    Background: In the early stages of a respiratory virus pandemic, 
a consumer goods company working under a government contract 
developed improved face masks that filter out 99% of that virus' 
particles. The contractor filed for a patent on its mask technology, 
and it reported the subject invention and associated patent 
application to the government. During a three-week window, several 
experts published studies confirming that the virus spreads easily 
and rapidly through airborne transmission. The following week, the 
consumer goods company increased the price of its masks 100%, and it 
continued to raise the price over the course of a month, resulting 
in a 400% price increase. The company has also sent letters to other 
mask manufacturers, flagging the pending patent application and 
promising to file lawsuits against any infringers as soon as the 
patent issues. Trade associations representing frontline healthcare 
workers asked the government funding agency to march-in and issue 
licenses to those other manufacturers to bring down the price of the 
masks.
    Discussion: Given the urgent need, march-in would be among a 
range of options the agency would likely consider for resolving this 
problem promptly and protecting frontline workers.
    Statutory Criteria--In this scenario, it appears there could be 
actions that promote nonuse or unreasonable use of the subject 
invention (Criterion 1) as well as health and safety needs that are 
not being reasonably satisfied by the contractor (Statutory 
Criterion 2). The agency would first ask the contractor for 
information to confirm the basic facts--for example, that the 
contractor has increased price 400%, how that increase compares to 
prices for other masks, how that price point compares to the cost of 
developing and manufacturing the masks, that the contractor has 
filed for patents, and that it is threatening to file suit against 
competing manufacturers when a patent issues. Based on that, the 
agency could continue its inquiry to assess whether march-in would 
alleviate an unmet health need and/or ensure the benefits of the 
mask are available to the public on reasonable terms, exploring 
questions detailed in Statutorily Defined March-In Criteria; 
Criterion 1 and 2. In this scenario, more affordable masks are 
needed and it may be that more mask production would bring down the 
price (Section III; IV, E). The agency would likely need more 
information to assess whether the contractor is exploiting the 
health or safety need in setting a product price that is egregious 
within the U.S. market and unjustified given the totality of 
circumstances and/or whether the masks are available on reasonable 
terms (Section IV, E). By rapidly increasing the price of masks and 
threatening other manufacturers with litigation during an urgent 
public health need, the contractor seems focused on keeping prices 
unusually high while not satisfying demand. This could weigh in 
favor of march-in. But the agency would need additional information, 
for example, to understand the unmet need, how march-in would impact 
it, and why the contractor is

[[Page 85604]]

responding this way. Are other mask manufacturers charging similarly 
high prices under the circumstances, all to fund facility expansion? 
If so, that would weigh against march-in (Section IV, E). Is there a 
strong connection between mask usage (or mask availability) and 
public health benefit? Does this mask provide unique benefits over 
others? Stronger evidence the masks resolve a health need could 
weigh more in favor of march-in, whereas tangential evidence of 
unique benefits could weigh against march-in (Section III). Is there 
a legitimate reason not to license other manufacturers for this 
mask, e.g., they lack capacity or capability? Answers to those 
questions could justify the contractor's actions and weigh against 
march-in (Section IV, E).
    Policy & Objectives of Bayh-Dole--The first part of this 
analysis looks at whether march-in would promote utilization and 
protect against non-use of the subject invention (Would March-In 
Support The Policy & Objective Of Bayh-Dole Section I). The agency 
would need to understand whether other manufacturers are 
``responsible applicants'' that would be interested and willing to 
make the masks in question (Section I, E). The agency would also 
likely want to understand the impact of the pending patent 
application and threat of (possible) litigation on the other 
manufacturers (I, B; II, E). If the other manufacturers are actually 
deterred from making the product, then that could weigh in favor of 
march-in. However, if other manufacturers do not believe valid 
patents are going to issue on this subject invention, and those 
manufacturers are willing to immediately start manufacturing masks, 
that could weigh against march-in. The agency would also consider 
whether other action might be warranted--for example, the agency 
purchasing or manufacturing the masks itself at a lower price 
(Section II, A). Whether march-in would protect the public against 
non-use or unreasonable use of subject inventions more broadly 
likely depends on similar facts (Section III). However, in a 
situation of a pressing health or safety need, where a contractor is 
artificially keeping supply low while demand for a product is high 
or artificially increasing the price, march-in could deter others 
from similar actions in the future without impacting contractors and 
licensees who act in good faith to bring products to market and meet 
market demand (Section III, A, 2).

Scenario 7

    Background: The Department of Transportation has been working 
with industry to develop the requirements and technologies for 
vehicle-to-everything (V2X) communications. This technology will 
allow vehicles to automatically communicate with each other basic 
safety messages including location, direction of travel, speed, and 
other relevant information that can serve to reduce traffic 
accidents. Additionally, the technology will allow vehicles to 
receive messages from networked roadside units that can warn a 
driver about work zones or traffic accidents miles ahead of them 
along their current path of travel or road conditions such as icy or 
wet roads. The National Highway Traffic Safety Administration 
(NHTSA) within the U.S. Department of Transportation is responsible 
for the Federal Motor Vehicle Safety Standards and the regulatory 
requirements that all automobiles must satisfy to be sold in the 
U.S. NHTSA has issued a regulation that requires the inclusion of a 
transceiver capable of transmitting and receiving such messages in 
all new automobiles. A contractor under government funding developed 
a technology essential to the operation of such transceiver but to 
date has refused to license the technology to any auto 
manufacturers, instead insisting that it can supply the entire 
automotive industry with the required equipment. Auto manufacturers 
have approached the government seeking assistance in getting a 
license to manufacture the equipment because the contractor has 
failed to satisfy industry demand.
    Discussion:
    Statutory Criteria--In this scenario, it appears that march-in 
may help meet requirements for public use specified by a federal 
regulation (Statutory Criterion 3). The federal regulation in 
question for this march-in analysis requires inclusion of a 
transceiver capable of transmitting and receiving basic safety 
messages in all new automobiles. The agency would need to 
investigate whether the contractor is meeting the industry's need in 
order to comply with this regulation and determine whether the 
contractor is restricting access or imposing barriers (Statutorily 
Defined March-In Criteria; Criterion 3, II, A). The agency would 
discuss the issue with the contractor, and if the contractor is in 
fact unwilling to license the technology, the agency would likely 
discuss whether and how the contractor plans to individually meet 
the current or future needs (Section VI). If the contractor has 
discernable plans, the agency may choose to set certain timeframes 
or thresholds that the contractor must meet to avoid march-in. The 
agency may also assess whether the contactor is willing to license 
the subject invention on commercially reasonable terms--if it is 
refusing prospective licensees because it will only accept 
unreasonably high royalties, that could weigh in favor of march-in 
(Section II, A). If it is open to reasonable licensing offers, that 
cuts the other way. The agency would also need to explore whether 
there are other technologies that do or could also address this same 
need (Section IV). If the contractor's invention is the only one 
that could address this need, and the company cannot offer a plan to 
provide adequate supply and meet the regulatory requirements, these 
factors would weigh in favor of march-in. Whereas, if there are 
alternatives that could meet or implement the regulatory 
requirements, that would weigh against march-in.
    Policy & Objectives of Bayh-Dole--The agency would assess the 
practical impact of march-in on regulatory compliance, carefully 
evaluate alternatives, and look at the broader context (Would March-
In Support the Policy & Objective of Bayh-Dole). For example, the 
direct interest from auto manufacturers suggests that march-in might 
increase production of the subject invention, since there are 
already interested licensees (Section I). Although the agency may 
also want to look at timelines; for example, if these technologies 
have short life cycles and there is likely to be more advanced 
technology to meet the regulatory requirements within the year, that 
could weigh against march-in. Likewise, the agency would continue to 
look at viable alternatives that are already available to meet the 
regulatory needs and could be relevant to avoid march-in (Section 
II). Finally, the agency would review the broader impacts and policy 
and objectives of Bayh-Dole (Section III). The agency may determine, 
because the contractor cannot meet the industry need, that the 
negative impacts on future R&D and utilization are minimal and 
decide to exercise march-in.

Scenario 8

    Background: A government-funded university, after years of both 
broad and targeted marketing efforts, executed an exclusive license 
for a new compound demonstrated effective in Phase III clinical 
trials for treating Alzheimer's disease with a large Swiss 
pharmaceutical company active in drug development and the 
manufacture of proprietary medicines. The new compound was 
government-funded in its initial stages of development. The terms of 
the exclusive license did not reference the Bayh-Dole regulations 
and requirement for U.S. manufacturing unless waived by the 
government. The exclusive licensee has begun manufacturing limited 
quantities of the active pharmaceutical ingredient (API) of the 
compound at its existing facilities in Switzerland prior to FDA 
approval. The Swiss company has no manufacturing facilities in the 
U.S. The government-funded university self-reported to the funding 
agency the deficiency in the terms of the exclusive license and 
reported the status of manufacturing the API. The government-funded 
university has not requested a waiver. The head of the agency has 
asked about possible use of march-in rights.
    Discussion:
    Statutory Criteria--In this scenario, it appears that the 
contractor did not include the agreement terms required by 35 U.S.C. 
204 in its exclusive license agreement (Statutorily Defined March-in 
Criterion 4). The agency would review the facts of the case to 
ensure that the U. S. industry preference under Sec.  204 was 
triggered. Based on the facts presented, the contractor exclusively 
licensed the right to use or sell a product embodying the subject 
invention (Statutorily Defined March-In Criteria; Criterion 2, 
Section IV, A & C). The agency would need to confirm that the 
exclusive license included the right to use or sell in the U.S. 
(Section IV, B), and would need to confirm whether the preference 
for U.S. industry applies. Assuming Sec.  204 is triggered, under 
this scenario the exclusive license does not include a provision 
requiring products to be manufactured substantially in the U.S. 
(Section I, C). The scenario provides that the licensee intends to 
manufacture only in Switzerland, but the agency would want to have 
the contractor confirm that the licensee has no U.S. manufacturing 
facilities (Section I, F). Finally, the scenario provides that the 
contractor has not requested a waiver

[[Page 85605]]

of the preference for U.S. industry (Sections I, C, 1; I, F, 1). 
These facts, without more and if not remedied, would collectively 
weigh in favor of march-in.
    Policy & Objectives of Bayh-Dole--Next the agency will consider 
Bayh-Dole's policy and objectives in its march-in assessment. As 
part of this analysis, the agency should consult with the contractor 
and determine whether the license agreement could be amended to 
include the preference for U.S. industry and whether the current 
licensee would be willing and able to manufacture substantially in 
the U.S. Perhaps the agency could even assist in identifying 
potential U.S. manufacturers (Would March-In Support the Policy & 
Objective of Bayh-Dole Section II, A-C). If the contractor and 
current licensee agree to a U.S. manufacturer or manufacturing 
facilities, this would weigh against exercising march-in. If they 
refused, that could weigh in favor of march-in. The agency should 
also consider whether, if the contractor had submitted a waiver, a 
waiver would have been granted; and it should inquire as to whether 
the contractor, following a notice of non-compliance by the agency, 
submits a domestic manufacturing waiver request (Section I, D). In 
this scenario, it appears the contractor conducted extensive 
marketing to find a licensee; suggesting it was difficult to line up 
a manufacturer anywhere in the world. If the agency, for example, 
finds that the contractor offered this technology for license under 
similar terms to companies who were likely to manufacture in the 
U.S., but none of those manufacturers were interested, then the 
agency may consider granting a domestic manufacturing waiver and 
decide not to march-in. If the contractor refused to apply for a 
waiver, that could weigh in favor of march-in. As part of this 
assessment, the agency could likewise consider whether there is 
another prospective licensee able to manufacture substantially in 
the U.S. (Section I, E). Finally, the agency would consider the 
wider implications of march-in, including whether exercising march-
in--if the contractor refused to amend its license, seek a waiver, 
or relocate manufacturing--would send a message that the U.S. 
industry preference provisions of the Bayh-Dole Act will be enforced 
(Section III, A, 2).

[FR Doc. 2023-26930 Filed 12-7-23; 8:45 am]
BILLING CODE 3510-13-P