Why didn’t the government use Bayh-Dole to rein in drug prices before? A major obstacle was uncertainty about whether price-gouging was ever intended to be one of the conditions permitting the government to snatch back a patent. In 2002, Peter Arno, professor of epidemiology and social medicine at the Albert Einstein College of Medicine, and Michael Davis, professor of law at Cleveland State University in Ohio, argued in a Washington Post op-ed that of course Congress intended pricing to be taken into account. Dole and Bayh then replied, in a Washington Post op-ed of their own, that
Bayh-Dole did not intend that government set prices on resulting products. The law makes no reference to a reasonable price that should be dictated by the government. This omission was intentional….
Big Pharma cites this this as a conversation-ender, sort of like Woody Allen’s Marshall McLuhan triumph in Annie Hall (“You know nothing of my work”). But Bayh and Dole’s op-ed had already been contradicted by Bayh himself filing a march-in petition five years earlier based, as noted above, on pricing (“unreasonably high royalties”). If Bayh really believed, along with Dole, that pricing was irrelevant to Bayh-Dole, he had a funny way of showing it.
On Thursday, the Biden administration announced that a review initiated last March by the Health and Human Services and Commerce Departments concluded that, contrary to a rule proposed by the Trump administration but never finalized by the Biden administration, “price can be a factor in determining that a drug or other taxpayer-funded invention is not accessible to the public.” (Italics mine.) According to Politico, the Biden administration isn’t targeting any particular drug, and it isn’t expected to; so far, the policy seems intended mainly to put drug companies on notice that if they price drugs derived from federal research too prohibitively, they’ll risk the feds finally imposing the punishment Bayh and Dole authorized 43 years ago.