Inventions, Patents, bayh-dole, extramural reporting compliance responsibilities

8.2.4 Inventions and Patents

The Bayh-Dole Act of 1980 (Public Law 96-517; 35 U.S.C. 200-212; Executive Order 12591; 37 C.F.R. 401 et al; updated April 14, 2018.) provides NIH funding recipients incentives to promote the utilization of inventions conceived or reduced to practice (Subject Invention) in the performance of federally supported research and development. Unless waived by NIH or the funding agreement is for educational purposes, e.g. fellowships, training grants or certain types of career development awards, the Bayh-Dole Act applies to all NIH research and development funding granted to for-profit organizations regardless of size and all non-profit entities. (See 45 CFR 75 and 37 CFR 401.1(b)).

To retain rights and title to Subject Inventions, the NIH funding recipient must comply with the Bayh-Dole statute and implementing regulations that ensure the Invention will be brought to practical application while protecting certain rights of the Federal government. The compliance actions required by the Bayh-Dole Act are summarized below at Exhibit 8.

Failure of the recipient to comply with any of the Bayh-Dole regulations cited at 37 CFR 401 or other requirements may result in the loss of patent rights or the suspension, termination or withholding of NIH funding support. See also Section 8.5.2 for additional remedies for noncompliance of the Bayh-Dole Act.

All Bayh-Dole compliance actions are required to be submitted to NIH by using the iEdison data base (See 37 C.F.R. 401.16). All issues or questions regarding extramural technology transfer policy and reporting of inventions and their utilization should be referred to the Division of Extramural Inventions and Technology Resources, OPERA/OER at edison@nih.gov.

Exhibit 8. Extramural Invention Reporting Compliance Responsibilities

Invention Compliance Reporting Requirement Action Required When Compliance Action Must Be Taken.
(All Compliance Actions are to be Submitted to NIH through iEdison)
37 CFR 401 Reference
Employee Agreement to Disclose All Subject Inventions Recipient employees working under a federal funding award (other than clerical and nontechnical employees) must sign an agreement with the recipient organization. This agreement requires the Recipient employee to: (1) disclose promptly in writing to personnel identified as responsible for the administration of patent matters each Subject Invention made under NIH funding; (2) assign to the Recipient the entire right, title and interest in and to each Subject Invention made under the funding agreement; (3) execute all papers necessary to file patent applications on Subject Inventions; and, (4) establish the government's right in the Subject Inventions. Before a Recipient or a consortium employee participates in NIH-funded research and development. 401.14(f)(2)
Consortium Participant Rights in Inventions All consortium participants, regardless of tier, for experimental, developmental or research work retain all rights and obligations provided to the Consortium Participant in the NIH funding agreement. At the time of issuance of a consortium agreementA formalized agreement whereby a research project is carried out by the recipient and one or more other organizations that are separate legal entities. Under the agreement, the recipient must perform a substantive role in the conduct of the planned research and not merely serve as a conduit of funds to another party or parties. These agreements typically involve a specific level of effort from the consortium organization's PD/PI and a categorical breakdown of costs, such as personnel, supplies, and other allowable expenses, including F&A costs. The relationship between the recipient and the collaborating organizations is considered a subaward relationship. (See Consortium Agreements chapter in IIB)., recipient must include in all consortium agreements, regardless of tier, for experimental, development, or research work 37 C.F.R. 401 et seq suitably modified to identify the parties and the rights and obligations awarded to the contractor. 401.14(g)(1)
401.14(g)(2)
401.14(g)(3)
Invention Disclosure The term "Subject Invention" means any invention of a recipient/consortium participant conceived or first actually reduced to practice in the performance of work under a funding agreement.

The recipient must submit to NIH a disclosure for all Subject Inventions. There is no single format for disclosing the invention to NIH. However, the disclosure of the Subject Invention must include: a detailed technical description of the invention conveying a clear understanding of the nature, purpose, operation, and the physical, chemical, biological, or electrical characteristics of the Subject Invention; the names of all inventors; title of the Subject Invention; all federal funding agreement numbers; date of disclosure of the Subject Invention from the researcher or inventor to the Recipient; and whether a manuscript describing the invention was submitted, accepted and/or published.
Within 2 months of the inventor's disclosure to the recipient organization. 401.14(a)(2)
401.14(c)(1)
Government Assignment to Recipient of Rights in Invention of Government Employee Disclosure to NIH that a federal employee is a co-inventor on a Subject Invention. Within 2 months of receipt of the initial invention report. 401.14(f)(2)
401.10
Acceptance of Manuscript following Submission of Initial Invention Disclosure The recipient needs to promptly notify NIH of the acceptance of any manuscript describing the Subject Invention. Promptly following the acceptance of a manuscript describing a Subject Invention. 401.14(c)(1)
Election of Title to a Subject Invention The recipient must notify NIH of its decision to retain title to a Subject Invention and any associated patent rights.

Election of title is made before the filing of an Initial Patent Application.

Statutory Period is defined as the one-year period before the effective filing date of a claimed invention during which exceptions to prior art exist per 35 U.S.C. 102(b) as amended by the Leah-Smith American Inventions Act, Public Law 112-29.
Within 2 years of the disclosure of the invention to NIH.

In any case where a patent, a printed publication, public use, sale or other availability to the public has initiated the one-year Statutory Period wherein valid patent protection can still be obtained in the United States, the period for election of title is shortened by NIH to a date that is no more than 60 days prior to the end of the statutory period.
401.14(b)
401.14(c)(2)
401.2(n)
Confirmatory License For each Subject Invention, the recipient must provide a license to NIH confirming the rights the Government has throughout the world in the Subject Invention.

When a confirmatory license is filed on the Initial Patent Application the license applies to all subsequent patent applications linked in the patent family.
When the Initial Patent Application is filed. 401.14(f)(1)
Government Support Clause The recipient must include, within the specification of all United States patent applications and any patent issuing thereon covering a Subject Invention, the following statement, "This invention was made with government support under (identify the contract) awarded by (identify the Federal agency). The government has certain rights in the invention." Must be included within the specifications of any United States patent applications and any patent(s) issuing thereon covering a Subject Invention. 401.14(f)(4)
Patent Applications and Issued Patents The recipient must inform NIH of the filing date of its Initial Patent Application, the Initial Patent Application number and title and all subsequently filed patent applications.

Initial Patent Application is defined as the first provisional or nonprovisional U.S. national application for patent as defined in 37 CFR 1.9(a)(2) and (3), respectively, the first international application filed under the Patent Cooperation Treaty as defined in 37 CFR 1.9(b) that designates the United States, or the first application for a Plan Variety Protection certificate, as applicable, a non-provisional U.S. national application for patent as defined in 37 CFR 1.9(a)(3).
Within 1 year after election of title, or, if earlier, prior to the end of any Statutory Period wherein valid patent protection can be obtained in the United States after a publication, on sale, or public use, unless there is an extension of time granted by NIH. 401.14(c)(3)
401.14.(f)(6)
401.2(n)
Notification to NIH to Not to Continue Prosecution Notify NIH of any decision to: not to continue the prosecution of a non-provisional patent application; not to pay a maintenance, annuity or renewal fee; not to defend in a reexamination or opposition proceeding on a patent, in any country; to request, be a part to, or take action in a trial proceeding before the Patent Trial and Appeals Board of the U.S. Patent and Trademark Office including but not limited to post-grant review, review of a business method patent, inter partes review, and deviation proceeding; or to request, be a part to, or take action in a non-trial submission of art or information at the U.S. Patent and Trademark Office, including but not limited to a pre-issuance submission, a post-issuance submission, and supplemental examination. Notify NIH no less than 60 days prior to taking any action defined under "Action Required." 401.14(f)(3)
Assignment of Rights to Third Party If the recipient is a non-profit organization, it must request NIH prior approvalWritten approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). to assign a Subject Invention or U.S. patent rights to any third party, including the inventor(s).

Recipients that are for-profit entities (including small businesses) do not need to request approval for the assignment of a Subject Invention or U.S. patent rights to any third party.
Recipient must submit a Third-Party Waiver Request or an Inventor Waiver Request and must have NIH approval before any rights of the recipient are transferred or assigned. 401.10
401.14(k)(1)
Preference for United States Industry Recipient cannot grant to any person, unless approved by NIH in advance, the exclusive right to use or sell any Subject Invention in the United States unless any such product embodying the Subject Invention or produced through the use of the Subject Invention is manufactured substantially in the United States. For a waiver of this compliance requirement, a request is required to NIH providing specific details and reasons why the Subject Invention cannot be substantially manufactured in the United States. 401.14(i)
Issued Patent Recipient must notify NIH of the date a patent is issued, patent number, and the expiration date of the issued patent. When patent is issued. 401.5(f)(2)
Extension of Time to Disclose a Subject Invention The recipient may request for NIH's approval for an extension of time to disclose a Subject Invention. Not less than 30 days in advance of the 60-day disclosure reporting deadline. 401.14(c)(5)
Extension of Time to Elect Title to a Subject Invention Recipient may request with justification, NIH's approval of a request for an extension of up to 2 years to elect title to a Subject Invention. As needed before the expiration of the time allowed. 401.14(c)(5)
Extension of Time to File a Patent Application The recipient may request, subject to NIH's approval, an extension time up to 1 year to file a patent application.

The request must include details of why an extension is needed.
As needed before the expiration of the time allowed. 401.14(c)(5)
Extension of Time to File a Non-provisional Patent Application following the Filing of a Provisional Application as the Initial Patent Application When a recipient requests an extension of time for filing a non-provisional application, after filing a provisional application as an Initial Patent Application, a 1-year extension will be granted unless NIH notifies the recipient within 60 days of receiving the request.

Recipient must submit this request citing an extension of time pursuant to 401.14(c)(5). No additional details for the request are required.
As needed before the expiration of the time allowed. 401.14(c)(5)
Invention Utilization Report The recipient must submit an annual utilization report with information about the status of commercialization of any Subject Invention for which title has been elected. Annually, based on the fiscal year of the recipient. 401.14(h)
Annual Invention Statement The recipient must indicate any inventions made during the previous budget period in Section C of the Research Performance Progress Report (RPPR). Part of all competing applications and non-competing continuation progress reports. SF424, (R&R) PHS 2590, RPPR
Final Invention Statement and Certification The recipient must submit to the NIH awarding ICThe NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award. CGMO through the eRA Closeout Module a summary of all inventions made during the entire term of each grant award. Within 120 days after the project period (competitive segment) ends. 401.14(f)(5)