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Executive Summary

NIH REQUESTS COMMERCIALIZATION AGREEMENT INFORMATION FROM 103 RESEARCH CENTERS that receive the most funding from the institutes. The universities and research institutes are being asked to provide comprehensive information to the National Institutes of Health concerning their commercialization agreements with private industry. In letters sent in late February, NIH requested that the grantees "forward as promptly as possible...copies of any commercialization agreements your institution, including all of its research centers and hospitals, may have with industry." In particular, NIH asked that the research entity "describe fully your financial arrangements with the companies, what interest in research results or products the companies will receive and how the agreements will affect the conduct of research and the dissemination of research results." NIH noted that it will "review the commercialization agreements to ensure that they are consistent with the conditions attached to the NIH funding." The first round of letters requesting commercialization agreement information were sent to the 40 universities and research institutes that receive the most grant money from NIH on Feb. 19. They were asked to provide the information by March 1. A second batch of letters to another 63 institutions were sent on Feb. 25. NIH asked that those institutions provide their information by March 8. The letters also request that the universities and research institutes provide a list of all inventions "made under Federal grants and contracts." The institutions must specify "those for which active patent applications have been filed, those for which active patents have been issued, and those which have been licensed, stating which of those licenses has led to the commercialization of products," the letter says. In addition, all inventions made under commercialization agreements must be noted. NIH's apparent impetus for sending the letters to the research institutions was a Feb. 2 letter from Rep. Wyden (D-Ore.) to NIH Director Bernadine Healy inquiring about NIH's knowledge of a December agreement between Swiss drug manufacturer Sandoz and the Scripps Research Institute ("The Pink Sheet" Feb. 8, p. 14). The agreement stipulates that Sandoz provide Scripps $300 mil. over 10 years in return for rights to drug discoveries made at the institute. As a result of Wyden's inquiry, NIH recently sent a letter to Scripps asking for details on its relationship with Sandoz. In particular, NIH has requested a copy of the contract between the Scripps and Sandoz. However, Scripps has not submitted the contract due to confidentiality concerns. NIH has indicated that although it has not pressed Scripps for the contract, it may take punitive measures if the research institute does not provide the information. At a Feb. 24 hearing before Sen. Pryor's (D-Ark.) Special Committee on Aging, Wyden suggested that Scripps should be cut off from federal funding until it complies with NIH's requests. To further explore the Scripps/Sandoz agreement and the broader issue of financial relationships between pharmaceutical companies and tax-exempt research institutes, Wyden has scheduled a March 11 hearing before his Regulation, Business Opportunities and Technology Subcommittee of the House Small Business Committee. Scheduled witnesses include NIH Director Bernadine Healy and Office of Technology Transfer Director Reid Adler. NIH sent letters to three other facilities located in La Jolla, California: the Agouron Institute, La Jolla Cancer Research Foundation and the Medical Biology Institute. Other research centers targeted by NIH include: John Hopkins University, Columbia University, University of Wisconsin -- Madison, University of Minnesota, the Fred Hutchinson Cancer Research Center, and Vanderbilt University. More than pricing of CRADA products, NIH is concerned about its lack of authority over products and patents developed outside the institutes' labs with NIH funding. Healy said at the Feb. 24 Pryor hearing that NIH only has a say in 11% of its research portfolio since the Bayh-Dole Act of 1980 grants rights to inventions to NIH grantee institutions ("The Pink Sheet" March 1, p. 13).

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