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Solutions For Crisis in Healthcare: How Can Our US Tax Dollars Better Translate Into Medical Benefit?

by Fred Mermelstein, PhD

Executive Director and Founder, Javelin Pharmaceuticals, Inc.


It is readily apparent that the US government dedicates large amounts of taxpayer dollars to support fundamental scientific and medical research with few results of immediate and reasonable impact. The disparity between money spent and return on investment is an untold crisis. Moreover, the amount budgeted for healthcare research has not grown proportionally relative to the growth of the population in addition to the number of trained researchers and overall healthcare burden.


Of the over $30.5 billion NIH invests annually in medical research for the American people, the US Department of Health and Human Services reports that more than 80% of this is awarded through roughly 50,000 competitive grants to more than 325,000 researchers at over 3,000 universities, medical schools, and other research institutions both domestically and abroad. Approximately 10% of the NIH’s budget supports projects conducted by nearly 6,000 scientists in NIH owned laboratories.


With the bulk of the billions of NIH dollars dedicated to fundamental research, are we leveraging these dollars efficiently? Does money spent on basic research ultimately translate into practical applications which significantly impact the health, welfare and treatment of disease of the American people?


To begin unraveling this predicament, there are a number of potential solutions that could improve our current situation. A few simple modifications, including, but not necessarily limited to those described below, would likely advance NIH sponsored research and generate significant outcomes resulting in more immediate and long term benefits.


Suggested resolutions include:

  1. Require each grant application to include a simple, one paragraph description of how the intended research might be of practical benefit.
  2. Require technology transfer offices at universities and other funded institutions to review and monitor grant funded research for potential commercial value as a condition of grant issuance.
  3. Dedicate a minimal amount of grant funds to cover costs associated with filing a US Patent application to increase interaction between funded laboratories and their technology transfer offices and corporations interested in commercial development of research.

The goal of funds granted by NIH for basic research at universities and institutions is to "help fill gaps in our fundamental understanding of health and disease". NIH granted research results are widely published in peer-reviewed journals distributed in the public domain. This practice allows and encourages additional research that advances basic understanding of medicine and science. However, opportunities to capture commercially viable research results that translate into healthcare benefits are often lost for a number of reasons, including:

  1. Lack of full appreciation or understanding of the commercial value of research outcomes
  2. Inadvertent creation of prior art and loss of ability to file a patent due to premature disclosure

Research outcomes, in order to be of meaningful value to companies performing product development, must be secured with intellectual property (patent) to justify the significant investment required to take a potential product to market.


In addition, the bridge between fundamental research and product development, the "D" side of R&D is largely random and dependent on the interaction of the research community with the commercial community. This gap has been historically addressed by published papers, scientific conferences and presentations such that industry can cherry pick the best innovations that may still offer an opportunity to create intellectual property.


Industry is pressured to select fields of interest and investment based more upon potential for large profits, which drive significant shareholder value. Therefore, products with smaller market potential do not always gain the benefits of strong industry support, despite government legislated programs creating more tenable opportunities, including, but not limited to the orphan drug act.


The government, in part, has further addressed this issue by creating the Small Business Innovation Research (SBIR) and Technology Transfer (SBTT) programs which are largely driven by small businesses seeking NIH funding. These are set-aside programs, with 2.5% of the NIH’s budget allocated to domestic small business concerns engaged in research or research and development (R/R&D) with commercial potential.


While quantifying the success of the SBIR/SBTT programs in terms of benefit to our citizens, it has undoubtedly driven commercially oriented NIH sponsored research. Additionally, SBIR/SBTT programs are severely limited in scope because of the relatively meager funds available to the program, the disparity between funds available for fundamental research versus commercially oriented research and the lack of an effective system to translate the more than $30 billion research dollars into meaningful results.


Presently, because the system relies primarily on the principal investigator or researcher to capture the fruits of their research, it is critical not to disenfranchise them. But these suggested modifications would likely not impinge upon the free thought that stimulates the discovery process, and would likely enable more practical thinking toward generating research with more immediate impact on improving the healthcare system.


Other avenues of improving our healthcare system may not necessarily involve simply increasing research funding, but rather by systematic improvement through increased efficiencies. We owe it to ourselves to ensure our dollars are wisely invested and efficiently managed, without significantly impinging on "fundamental research". If the bulk of the funds granted by the NIH were subject to a process with more accountability for capturing relevant data and information with practical or commercial value, there is a high probability that research outcomes would more dramatically impact quality of life, economic stability and an overall increase in the well-being of the population at large.


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Comments : 0 - Last Post : Jul 30, 2009 9:51 AM by: Dr. Fred Mermelstein
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