That turns the whole case

Again, the impact was immediate. The Bayh-Dole Act has been widely praised as a significant factor contributing to the United States’ “competitive revival” in the 1990s.184 In 2002, The Economist called Bayh-Dole:

Possibly the most inspired piece of legislation to be enacted in America over the past half-century. Together with amendments in 1984 and augmentation in 1986, this unlocked all the inventions and discoveries that had been made in laboratories throughout the United States with the help of taxpayers’ money. More than anything, this single policy measure helped to reverse America's precipitous slide into industrial irrelevance.185

Allowing U.S. institutions to earn royalties through the licensing of their research provided a powerful incentive for universities and other institutions to pursue commercialization opportunities.186 The Bayh-Dole Act almost immediately led to an increase in academic patenting activity. For instance, while only 55 U.S. universities had been granted a patent in 1976, 240 universities had been issued at least one patent by 2006.187 Similarly, while only 390 patents were awarded to universities in 1980, by 2009, that number had increased to 3,088—and by 2015, to 6,680. Another analysis found that in the first two decades of Bayh-Dole (i.e., 1980 to 2002) American universities experienced a tenfold increase in their patents, and created more than 2,200 companies to exploit their technology.188 In total, over 80,000 U.S. patents have been issued to academic research institutions over the past 25 years.189 Moreover, academic technology transfer has supported the launch of over 12,000 start-ups since 1995.190 According to a report prepared for AUTM and the Biotechnology Industry Organization (BIO), from 1996 to 2015, academic patents and their subsequent licensing to industry—substantially stimulated by the Bayh-Dole Act—bolstered U.S. GDP by up to $591 billion, contributed to $1.3 trillion in gross U.S. industrial output, and supported 4,272,000 person years of employment.191 More than 200 drugs and vaccines have been developed through public-private partnerships since the Bayh-Dole Act entered force in 1980.192

AUTM’s 2016 Annual Survey again reiterated what a significant force academic technology transfer is in driving economic development. It found that the number of invention disclosures increased to 25,825 over the previous five years. From these discoveries, 16,487 new U.S. patent applications were filed, leading to 7,021 U.S. patents issued. It also identified 1,024 new start-ups formed on the basis of technology transfer.193 In fact, on average, three new start-up companies and two new products are launched in the United States every day as a result of university inventions brought to market, in part thanks to the Bayh-Dole Act.194 As Harvard University’s Naomi Hausman wrote, “The sort of large scale technology transfer from universities that exists today would have been very difficult and likely impossible to achieve without the strengthened property rights, standardized across granting agencies, that were set into law in 1980.”195

The Bayh-Dole Act has produced a number of additional benefits. For example, Hausman analyzed the impact of Bayh-Dole in shaping university relations with local economies, and found that the increase in university connectedness to industry under the intellectual property regime created by Bayh-Dole produced important local economic benefits. In particular, Hausman found that long-run employment, payroll, payroll per worker, and average establishment size grew differentially more after the 1980 Bayh-Dole Act in industries more closely related to innovations produced by a local university or hospital.196 There is also evidence that the Bayh-Dole Act contributed to university faculty responding to royalty incentives by producing higher-quality innovations.197 Evidence further suggests that patenting increased most after Bayh-Dole in lines of business that most value technology transfer via patenting and licensing.198

Many countries have enacted Bayh-Dole-like legislation because they recognize its power in turning their universities into engines of innovation.

Finally, countries throughout the world—including Brazil, China, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, South Africa, and Taiwan—have since followed the United States’ lead in establishing policies that grant their universities IP ownership rights.199 Even Kazakhstan and Zimbabwe are currently looking at implementing Bayh-Dole-like legislation, recognizing its power to help turn their universities into engines of innovation and commercialization. Likewise, the California Senate Office of Research conducted a comprehensive analysis of the Bayh-Dole Act and concluded: “After reviewing the literature and interviewing key experts, we recommend the Legislature consider adopting a statewide IP policy replicating the principles of the Bayh–Dole Act for research granting programs.”200 U.S. states and foreign countries have supported adoption of Bayh-Dole-like policies because they recognize that Bayh-Dole works. Simply put, the Bayh-Dole Act has created a powerful engine of practical innovation, producing many scientific advances that have extended human life, improved its quality, and reduced suffering for millions of people.201