[Ip-health] NIH rejects March-In petition, also rejects proposed rules on pricing of and access to government funded inventions

Claire Cassedy claire.cassedy at keionline.org
Thu Nov 7 08:17:40 PST 2013


NIH rejects March-In petition, also rejects proposed rules on pricing of
and access to government funded inventions

In a decision [1] dated November 1, 2013, and signed by NIH Director
Francis Collins, the NIH has rejected the 2012 petition to the NIH to uses
its powers under the Bayh-Dole Act to protect U.S. consumers from high
prices and restrictive licensing of NIH funded inventions.

The 2012 March-In petition (copy here:
http://keionline.org/2012ritonavir[2]) centered on ritonavir, a drug
used to treat HIV/AIDS and Hepatitis,
but also asked the NIH to adopt policies that would apply to any drug or
medical invention, and raised two issues of broad policy ramifications.

The first issue concerned the price of the drug, and was fairly
straightforward -- Abbott was charging US private sector consumers 4 to 10
times more for the use of ritonavir than the prices the company charged in
other high income countries. The petition asked the NIH to adopt a policy
that considered price discrimination against U.S. citizens to be an abuse
of the patent right.

The second issue concerned the obligation to license NIH funded patents for
use in follow-on inventions, when the patented invention could be useful to
"prevent, treat or diagnose medical conditions or diseases involving

In the NIH March-In case, KEI, PIRG, UAEM and AMSA proposed specific rules
to address these cases. On the pricing issue, the petitioners presented
evidence that 13 of 14 surveyed drugs with NIH funded patents were
significantly more expensive in the United States than in other high income
countries. (http://keionline.org/node/1541 [3])

The NIH rejection included this conclusion:

The NIH is sensitive to the impact of the pricing of drugs and their
availability to patients. As in 2004, when similar pricing and availability
issues were raised and discussed at public hearings, the NIH's role in the
present case is limited to compliance with the Bayh-Dole Act, including its
march-in criteria, outlined and discussed in detail (above).

Drug pricing and patient access are broad and challenging issue in the
United States. The NIH continues to agree with the public testimony in 2004
that the extraordinary remedy of march-in is not an appropriate means of
controlling prices of drugs broadly available to physicians and patients.

In conclusion, as set forth in this determination, the information and
justification provided in the Request, as well as publicly available
information, do not support re-consideration of the NIH determination to
decline to initiate a march-in proceeding for the Subject Patents used by
AbbVie in the production of Norvir and other combination products. As
stated in previous legislative and other remedies, not through the use of
the NIH's march-in authorities. The exercise of the Government's use
license to the Subject Patents is not appropriate in this case. Finally,
the NIH declines to set the rules proposed by the Requestors directing the
initiation of such proceedings based on certain price disparities between
the United States and other developed countries.

KEI will have a more extensive analysis of the NIH decision, but our
initial comment is as follows:

James Love, Director, Knowledge Ecology International, November 7, 2013
comment on NIH rejection of March-In petition

Once again the NIH has demonstrated its indifference to the interests of
taxpayers and U.S. consumers, when it comes to drugs invented on an NIH
grant. In more than 32 years, the NIH has yet to grant a March-In petition,
and it is apparent that the facts don't even matter. The NIH describes the
March-In right as an 'extraordinary remedy.' They could have described it
as a "phantom" or "non-existent" remedy, since it has never been used, by
the NIH. In this decision, the NIH says that price discrimination, against
US residents, on an NIH funded drug, is just fine as far as the NIH is
concerned. The NIH was presented with a survey of 14 NIH funded drugs, and
13 of the 14 were priced significantly higher in the USA than in any other
country. KEI, PIRG, UAEM and ASMA asked the NIH to grant march-in petitions
when the US price was significantly higher than the prices in other high
income countries. The NIH said no, and passed the buck to a Congress that
has been famously responsive to drug company lobbies.

There were many other issues one can highlight with the 7 page rejection of
the march-in petition. The NIH did not even acknowledge that Abbott's weak
evergreening patent claims were the subject of challenges at the USPTO by
the Public Patent Foundation. The NIH took the position that Abbott's
refusal to license ritonavir for co-formulated AIDS or hepatitis drugs sold
by competitors have no impact on public health. The NIH decision made it
sound as though the public testimony in 2004 against the march-in was from
disinterested parties, while all of the testimony against the march-in was
from parties that were making money on NIH funded inventions.

At this point, we plan to appeal the NIH decision to the Secretary of HHS.

[2] http://keionline.org/2012ritonavir
[3] http://keionline.org/node/1541

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