Recoupment Efforts Threaten Federal Research: Encouraged by Congress to Patent Inventions, Academic Researchers Now Face a Drive by Government to Recover Royalty Income (Perspectives‪)‬

In recent years, members of Congress and health advocates have proposed legislative "recoupment measures" that would inappropriately and unfairly place the onus for the pricing and affordability of therapeutic drugs and biologics on academic and other nonprofit research institutions by imposing levies on their royalty income streams. There are at least three compelling reasons why such efforts are problematic and should be opposed. First, these proposals rest on the unfounded assumption of a causal relationship between industry pricing policies and academic institutions' receipt of royalty streams from successful licensing and commercialization of intellectual property derived from federally funded research. Second, such proposals imply that current federal science policy neither seeks nor achieves a satisfactory "return on investment" in the form of widespread public health benefits, thereby contradicting the most compelling arguments for public funding of scientific research. Third, there is no reason to believe that once implemented, such approaches, now directed at certain "blockbuster" drugs whose origins may be traced, often circuitously, to National Institutes of Health (NIH)-funded research, would not be applied more broadly to other commercial products, both within and outside biomedicine, that yield patent income to research institutions. Proposals to use federal research funding and patent law to leverage drug pricing go back more than a decade. More recently, in December 2000, Congress attached report language to appropriations legislation funding NIH, noting that: "The conferees have been made aware of the public interest in securing an appropriate return on the NIH investment in basic research. The conferees are also aware of the mounting concern over the cost to patients of therapeutic drugs." Congress instructed NIH to list all Food and Drug Administration (FDA)-approved drugs with annual sales exceeding $500 million that were developed with NIH support. It further directed NIH to prepare a plan to ensure that "taxpayer's interests" are protected.