[Congressional Record Volume 144, Number 93 (Tuesday, July 14, 1998)]
[House]
[Pages H5424-H5428]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           TECHNOLOGY TRANSFER COMMERCIALIZATION ACT OF 1998

  Mr. SENSENBRENNER. Mr. Speaker, I move to suspend the rules and pass 
the bill (H.R. 2544) to improve the ability of Federal agencies to 
license federally owned inventions, as amended.
  The Clerk read as follows:

                               H.R. 2544

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Technology Transfer 
     Commercialization Act of 1998''.

     SEC. 2. COOPERATIVE RESEARCH AND DEVELOPMENT AGREEMENTS.

       Section 12(b)(1) of the Stevenson-Wydler Technology 
     Innovation Act of 1980 (15 U.S.C. 3710a(b)(1)) is amended by 
     inserting ``or, subject to section 209 of title 35, United 
     States Code, may grant a license to an invention which is 
     federally owned, made before the granting of the license, and 
     directly related to the scope of the work under the 
     agreement,'' after ``under the agreement,''.

     SEC. 3. LICENSING FEDERALLY OWNED INVENTIONS.

       (a) Amendment.--Section 209 of title 35, United States 
     Code, is amended to read as follows:

     ``Sec. 209. Licensing federally owned inventions

       ``(a) Authority.--A Federal agency may grant an exclusive 
     or partially exclusive license on a federally owned invention 
     only if--
       ``(1) granting the license is a reasonable and necessary 
     incentive to--
       ``(A) call forth the investment capital and expenditures 
     needed to bring the invention to practical application; or
       ``(B) otherwise promote the invention's utilization by the 
     public;
       ``(2) the Federal agency finds that the public will be 
     served by the granting of the license, as indicated by the 
     applicant's intentions, plans, and ability to bring the 
     invention to practical application or otherwise promote the 
     invention's utilization by the public, and that the proposed 
     scope of exclusivity is not greater than reasonably necessary 
     to provide the incentive for bringing the invention to 
     practical utilization, as proposed by the applicant, or 
     otherwise to promote the invention's utilization by the 
     public;
       ``(3) the applicant makes a commitment to achieve practical 
     utilization of the invention within a reasonable time;
       ``(4) granting the license will not tend to substantially 
     lessen competition or create or maintain a violation of the 
     Federal antitrust laws; and
       ``(5) in the case of an invention covered by a foreign 
     patent application or patent, the interests of the Federal 
     Government or United States industry in foreign commerce will 
     be enhanced.
       ``(b) Manufacture in United States.--A Federal agency shall 
     normally grant a license to use or sell any federally owned 
     invention in the United States only to a licensee who agrees 
     that any products embodying the invention or produced through 
     the use of the invention will be manufactured substantially 
     in the United States.
       ``(c) Small Business.--First preference for the granting of 
     any exclusive or partially exclusive licenses under this 
     section shall be given to small business firms having equal 
     or greater likelihood as other applicants to bring the 
     invention to practical application within a reasonable time.
       ``(d) Terms and Conditions.--Licenses granted under this 
     section shall contain such terms and conditions as the 
     granting agency considers appropriate. Such terms and 
     conditions shall include provisions--
       ``(1) retaining a nontransferrable, irrevocable, paid-up 
     license for the Federal agency to practice the invention or 
     have the invention practiced throughout the world by or on 
     behalf of the Government of the United States;
       ``(2) requiring periodic reporting on utilization of the 
     invention, and utilization efforts, by the licensee, but only 
     to the extent necessary to enable the Federal agency to 
     determine whether the terms of the license are being complied 
     with; and
       ``(3) empowering the Federal agency to terminate the 
     license in whole or in part if the agency determines that--
       ``(A) the licensee is not executing its commitment to 
     achieve practical utilization of the invention, including 
     commitments contained in any plan submitted in support of its 
     request for a license, and the licensee cannot otherwise 
     demonstrate to the satisfaction of the Federal agency that it 
     has taken, or can be expected to take within a reasonable 
     time, effective steps to achieve practical utilization of the 
     invention;
       ``(B) the licensee is in breach of an agreement described 
     in subsection (b);
       ``(C) termination is necessary to meet requirements for 
     public use specified by Federal regulations issued after the 
     date of the license, and such requirements are not reasonably 
     satisfied by the licensee; or
       ``(D) the licensee has been found by a competent authority 
     to have violated the Federal antitrust laws in connection 
     with its performance under the license agreement.
       ``(e) Public Notice.--No exclusive or partially exclusive 
     license may be granted under this section unless public 
     notice of the intention to grant an exclusive or partially 
     exclusive license on a federally owned invention has been 
     provided in an appropriate manner at least 15 days before the 
     license is granted, and the Federal agency has considered all 
     comments received in response to that public notice. This 
     subsection shall not apply to the licensing of inventions 
     made under a cooperative research and development agreement 
     entered into under section 12 of the Stevenson-Wydler 
     Technology Innovation Act of 1980 (15 U.S.C. 3710a).
       ``(f) Basic Business Plan.--A Federal agency may grant a 
     license on a federally owned invention only if the person 
     requesting the license has supplied to the agency a basic 
     business plan with development milestones, commercialization 
     milestones, or both.
       ``(g) Nondisclosure of Certain Information.--Any basic 
     business plan, and revisions thereto, submitted by an 
     applicant for a license, and any report on the utilization or 
     utilization efforts of a licensed invention submitted by a 
     licensee, shall be treated by the Federal agency as 
     commercial and financial information obtained from a person 
     and not subject to disclosure under section 552 of title 5, 
     United States Code.''.
       (b) Conforming Amendment.--The item relating to section 209 
     in the table of sections for chapter 18 of title 35, United 
     States Code, is amended to read as follows:

``209. Licensing federally owned inventions.''.

     SEC. 4. TECHNICAL AMENDMENTS TO BAYH-DOLE ACT.

       Chapter 18 of title 35, United States Code (popularly known 
     as the ``Bayh-Dole Act''), is amended--
       (1) by amending section 202(e) to read as follows:
       ``(e) In any case when a Federal employee is a coinventor 
     of any invention made under a funding agreement with a 
     nonprofit organization or small business firm, the Federal 
     agency employing such coinventor may, for the purpose of 
     consolidating rights in the invention--
       ``(1) license or assign whatever rights it may acquire in 
     the subject invention from its employee to the nonprofit 
     organization or small business firm; or
       ``(2) acquire any rights in the subject invention, but only 
     to the extent the party from whom the rights are acquired 
     voluntarily enters into the transaction.''; and
       (2) in section 207(a)--
       (A) by striking ``patent applications, patents, or other 
     forms of protection obtained'' and inserting ``inventions'' 
     in paragraph (2); and
       (B) by inserting ``, including acquiring rights for the 
     Federal Government in any invention, but only to the extent 
     the party from whom the rights are acquired voluntarily 
     enters into the transaction, to facilitate the licensing of a 
     federally owned invention'' after ``or through contract'' in 
     paragraph (3).

     SEC. 5. TECHNICAL AMENDMENTS TO THE STEVENSON-WYDLER 
                   TECHNOLOGY INNOVATION ACT OF 1980.

       Section 14(a)(1) of the Stevenson-Wydler Technology 
     Innovation Act of 1980 (15 U.S.C. 3710c(a)(1)) is amended--
       (1) in subparagraph (A)(i), by inserting ``, if the 
     inventor's or coinventor's rights are assigned to the United 
     States'' after ``inventor or coinventors''; and
       (2) in subparagraph (B), by striking ``succeeding fiscal 
     year'' and inserting ``2 succeeding fiscal years''.

[[Page H5425]]

     SEC. 6. REVIEW OF COOPERATIVE RESEARCH AND DEVELOPMENT 
                   AGREEMENT PROCEDURES.

       (a) Review.--The Director of the Office of Science and 
     Technology Policy, in consultation with relevant Federal 
     agencies, national laboratories, and any other person the 
     Director considers appropriate, shall review the general 
     policies and procedures used by Federal agencies to gather 
     and consider the views of other agencies on--
       (1) joint work statements under section 12(c)(5)(C) or (D) 
     of the Stevenson-Wydler Technology Innovation Act of 1980 (15 
     U.S.C. 3710a(c)(5)(C) or (D)); or
       (2) in the case of laboratories described in section 
     12(d)(2)(A) of the Stevenson-Wydler Technology Innovation Act 
     of 1980 (15 U.S.C. 3710a(d)(2)(A)), cooperative research and 
     development agreements under such section 12,

     with respect to major proposed cooperative research and 
     development agreements that involve critical national 
     security technology or may have a significant impact on 
     domestic or international competitiveness.
       (b) Procedures.--Within one year after the date of the 
     enactment of this Act, the Director of the Office of Science 
     and Technology Policy, in consultation with relevant Federal 
     agencies and national laboratories, shall--
       (1) determine the adequacy of existing procedures and 
     methods for interagency coordination and awareness; and
       (2) establish and distribute to appropriate Federal 
     agencies--
       (A) specific criteria to indicate the necessity for 
     gathering and considering the views of other agencies on 
     joint work statements or cooperative research and development 
     agreements as described in subsection (a); and
       (B) additional procedures, if any, for carrying out such 
     gathering and considering of agency views.

     Procedures established under this subsection shall be 
     designed to the extent possible to use or modify existing 
     procedures, to minimize burdens on Federal agencies, to 
     encourage industrial partnerships with national laboratories, 
     and to minimize delay in the approval or disapproval of joint 
     work statements and cooperative research and development 
     agreements.
  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Wisconsin (Mr. Sensenbrenner) and the gentleman from Michigan (Mr. 
Barcia) each will control 20 minutes.
  The Chair recognizes the gentleman from Wisconsin (Mr. 
Sensenbrenner).
  Mr. SENSENBRENNER. Mr. Speaker, I yield myself such time as I may 
consume.
  (Mr. SENSENBRENNER asked and was given permission to revise and 
extend his remarks.)
  Mr. SENSENBRENNER. Mr. Speaker, in the past two decades, Congress has 
established a system to transfer unclassified technology from our 
Federal laboratories to the private sector in order to facilitate its 
commercialization. This system is designed to ensure U.S. citizens 
receive the full benefit from our government's investment in research 
and development.
  To help further these goals, the Committee on Science first reported 
the Stevenson-Wydler Technology Innovation Act of 1980. The committee 
expanded on that landmark legislation with the passage of the Federal 
Technology Transfer Act of 1986, the National Competitive Technology 
Transfer Act of 1989, the American Technology Preeminence Act of 1991 
and the National Technology Transfer and Advancement Act of 1995, among 
others.
  Technology transfer has resulted in products which are currently 
being used to enhance our quality of life. Examples include the AIDS 
home testing kit, the global positioning system nautical navigation, 
and new materials technology to make automobiles lighter and more fuel-
efficient.
  H.R. 2544 continues the Committee on Science's long and rich history 
of advancing technology transfer to help boost our Nation's standard of 
living. I congratulate the Chair of the Subcommittee on Technology, the 
gentlewoman from Maryland (Mrs. Morella), for introducing H.R. 2544, 
and for her efforts to work cooperatively with members of the minority 
and the administration to craft this bipartisan bill.
  I would also like to acknowledge and congratulate the hard work of 
the ranking Members from the Committee on Science and Subcommittee on 
Technology, the gentleman from California (Mr. Brown) and the gentleman 
from Michigan (Mr. Barcia) on this important legislation. Its drafting 
and passage by the Committee on Science could not have occurred without 
their considerable input and assistance.
  The purpose of H.R. 2544 as reported is to promote the transfer and 
private sector commercialization of the technology created in our 
Nation's system of over 700 Federal laboratories, thereby leveraging 
Federal investment in scientific research through increasing 
collaboration with the private industry.
  Specifically, the bill improves and streamlines the ability of 
Federal agencies to license federally-owned inventions. H.R. 2544 does 
this by reducing procedural obstacles and, to the greatest extent 
possible, the uncertainty involved in the licensing of government-owned 
patented inventions.
  During the Committee on Science's hearing on this bill, the committee 
received testimony from both past and prospective private industry 
partners regarding their concerns about current Federal technology 
licensing processes.
  Witnesses indicated that the strategic advantage of acquiring 
intellectual property rights through a cooperative research and 
development agreement, called CRADA for short, and/or the licensing of 
government-owned technology, are, unfortunately, offset by the delays 
and uncertainty often associated with the lengthy Federal technology 
transfer process, which is often out of sync with private sector 
timing. In addition to the uncertainty of actually being granted the 
license, these procedural barriers increase transaction costs and delay 
commercialization.
  The present regulations also make it difficult for government-owned 
and government-operated laboratories, or GOGO for short, to bring 
existing scientific inventions into a CRADA, even when inclusion would 
create a more complete technology package.
  By reducing the delay and uncertainty imposed by existing procedural 
barriers and thus lowering transactional costs associated with the 
licensing of technology transferred from the Federal laboratories, 
Federal agencies could greatly increase participation by the private 
sector in their technology transfer programs.
  H.R. 2544 does just that. Its approach will expedite the 
commercialization of government-owned inventions and reduce the costs 
to the American taxpayer for the development of new technology-based 
products.
  Through H.R. 2544, Federal agencies are provided with two important 
new tools for effectively commercializing on-the-shelf government-owned 
inventions: First, revised authorities under section 209 of the Bayh-
Dole Act; and, second, the ability to license technology as part of a 
CRADA. Both mechanisms make Federal technology transfer programs much 
more attractive to U.S. private industries that seek to form 
partnerships with the Federal laboratories.
  The committee reported H.R. 2544 by voice vote. The bill was 
subsequently discharged by the Committee on the Judiciary, to which it 
was sequentially referred. I appreciate the cooperation of the chairman 
and ranking minority member of the Committee on the Judiciary, the 
gentleman from Illinois (Mr. Hyde) and the gentleman from Michigan (Mr. 
Conyers), for their assistance in bringing H.R. 2544 to the floor.
  This bill is yet another important step in refining our Nation's 
technology transfer laws to remove existing impediments to advance 
government and industry collaboration, and I urge its adoption.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BARCIA. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I would first begin by thanking the gentleman from 
Wisconsin (Chairman Sensenbrenner) and, of course, the ranking member 
the gentleman from California (Mr. Brown) for bringing H.R. 2544, the 
Technology Transfer Commercialization Act, to the floor. I would like 
to especially thank the bill's chief sponsor, the chairman of the 
Subcommittee on Technology, the gentlewoman from Maryland (Mrs. 
Morella), for her continued leadership on this and other important 
technology matters.
  The goal of H.R. 2544 is to make sure that those innovations owned by 
our Federal labs and with commercial potential enter the marketplace as 
quickly and efficiently as possible. However, the bill also includes 
important protections that the gentleman from Utah (Mr. Cook) and I 
introduced during our Subcommittee on Technology markup to promote 
fairness of opportunity, to increase due diligence on the part of 
licenses, and to encourage the creation of American jobs.

[[Page H5426]]

  The bill relaxes general notice requirements, but requires public 
notice when it matters most, when the granting of an exclusive license 
to a Federal invention is contemplated. Giving notice in advance of 
awarding an exclusive license is essential to ensure that the public 
gets full benefit from its research investment. This will make sure 
that every American company, no matter how small, has a chance to make 
its case for a license before exclusive rights are awarded. Without 
these protections, important innovations can inadvertently be blocked. 
Companies, often small businesses previously unknown to Federal 
laboratories, have responded to these public notices with revolutionary 
ideas that would otherwise have been lost.

                              {time}  1500

  The National Institutes of Health first learned of companies with the 
capability to turn NIH innovations into a cystic fibrosis gene therapy 
and a cervical cancer vaccine through public notices of the intent to 
grant exclusive licenses to someone else. The Department of Agriculture 
uncovered important applications of its research, including a novel egg 
immunization technology and a way to take formaldehyde out of permanent 
press fabrics which could have been blocked without public notice.
  Time and time again, public notice of the intent to grant exclusive 
licenses has produced dramatic results. The gentlewoman from Maryland 
(Mrs. Morella), the chairperson of the subcommittee, was absolutely 
right in pointing out to the committee that publication in the Federal 
Register is probably no longer the most effective method of public 
notice in an Internet age. Agencies need to make use of a variety of 
modern communication techniques such as electronic mailing lists, the 
Internet, and web pages. We encourage agencies to think creatively, to 
devise plans for reaching more people during shorter periods of public 
notice, and to pass the time savings on to their potential private 
sector partners.
  Further, as our private sector is ultimately driven by small 
business, the licensing of Federal inventions may well be our most 
successful and cost-effective program to aid these smaller firms. In 
fact, the Department of Defense grants 61 percent of its exclusive 
licenses to small businesses, NIST grants 80 percent of licenses to 
small businesses, and NASA grants 93 percent of its licenses to small 
businesses. This bill ensures that small businesses will continue to be 
the focus of technology transfer initiatives far into the future.
  Finally, this bill is geared toward American jobs. Federal licensees 
are expected to do high quality research and establish manufacturing 
jobs right here in the United States of America. In the 1980s, our 
committee showed wisdom in requiring a fair share of the jobs coming 
out of Federal innovations be located in the U.S. This bill will 
continue this important principle into the next century.
  Mr. Speaker, the Subcommittee on Technology, under the leadership of 
the gentlewoman from Maryland (Mrs. Morella) and our distinguished 
chairman, the gentleman from Wisconsin (Mr. Sensenbrenner), as well as 
our distinguished Ranking Member, the gentleman from California (Mr. 
Brown) have, in a bipartisan manner, invested a large amount of time 
and energy in gathering the information necessary to perfect this 
legislation. I strongly urge my colleagues to support this bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. SENSENBRENNER. Mr. Speaker, I yield 2 minutes to the gentleman 
from Utah (Mr. Cook).
  Mr. COOK. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Mr. Speaker, I rise in support of H.R. 2544, the Technology Transfer 
Commercialization Act of 1998. First, I would like to commend our 
chairman, the gentleman from Wisconsin (Mr. Sensenbrenner); the 
subcommittee chairwoman, the gentlewoman from Maryland (Mrs. Morella); 
and the ranking members of both committees, for their commitment and 
leadership on this legislation.
  H.R. 2544 will improve the laws promoting technology transfer from 
our Nation's Federal laboratories. It will facilitate Federal 
technology licensing by streamlining the process and eliminating 
burdensome procedural hurdles for American businesses.
  As a businessman I know the importance of keeping up with technology 
and the necessity of constantly innovating and initiating new ideas in 
order to remain competitive. I also understand how difficult it is to 
interact with the government. I am pleased that the committee accepted 
my pro-business amendments that further knock down some of the 
obstacles and concerns of industry when they seek to license technology 
from our Federal laboratories.
  H.R. 2544 will bolster America's ability to compete internationally 
and will help our economy reap the fruits of taxpayer-funded Federal 
technology research.
  I thank the chairman again for his support of this legislation, and I 
urge my colleagues to vote for this bill.
  Mr. BARCIA. Mr. Speaker, I yield 3\1/2\ minutes to the distinguished 
gentleman from California (Mr. Brown), ranking member of the House 
Committee on Science.
  (Mr. BROWN of California asked and was given permission to revise and 
extend his remarks.)
  Mr. BROWN of California. Mr. Speaker, I thank the gentleman for 
yielding me this time.
  Mr. Speaker, over the last 20 years we have seen a complete change in 
attitude regarding technology transfer, and it has been a change for 
the better. In 1979 and in 1980, the House Committee on Science and 
Technology, working with some far-thinking individuals in the Carter 
administration, the university community and the private sector, came 
up with a holistic method of thinking about innovation in this country 
and the legislation necessary to back it up.
  I am proud to have been a part of the bipartisan group of legislators 
who guided these bills, the Bayh-Dole Act and the Stevenson-Wydler Act, 
to enactment and who later worked with the Reagan administration to 
broaden their scope by extending the Bayh-Dole Act to government-owned, 
contractor-operated laboratories and by adding the concept of 
cooperative research and development agreements to the Stevenson-Wydler 
Act.
  When I say bipartisan, my colleagues will all recognize that Senator 
Bayh was a leading Democratic Senator from Indiana, and Senator Dole of 
course was the later-to-be Republican leader and candidate for 
President. Of the Stevenson-Wydler Act, Senator Stevenson was the 
junior Senator from Illinois at that time, and Mr. Wydler was the 
Ranking Member of the Committee on Science, which I am today, so I am 
following in his great footsteps. But the point that I am trying to 
make here is that we unabashedly worked together on a bipartisan basis 
to enact this type of legislation which was aimed at reaping greater 
benefits from our investments in research and development in this 
country, and these programs have succeeded.
  I should point out that the foundation for most of our current 
advanced technology programs was contained in the 1988 Trade Act, 
perhaps an odd place for it to be, but it was a separate title of that 
trade act which was signed into law by President Reagan and which has 
given us some of the new and, unfortunately, at times, controversial 
programs which have continued to help ensure our leadership in the 
world in terms of continually improving our market share in high 
technology products of all kinds.
  What were revolutionary ideas in the 1980 and 1986 bills are now the 
heart of our Federal laboratory policy. These ideas have been so 
successful that practice in some ways has outgrown the original 
statute. Rather than having thousands of Federal inventions going 
unused, we now see intense competition in the private sector for the 
best ideas and need to ensure fairness of opportunity in selecting the 
most appropriate licensees, and this is what the legislation before us 
attempts to encourage. Instead of Federal researchers meeting their 
colleagues from outside the government only in professional meetings, 
we now have a culture of cooperative research involving Federal labs 
and universities in the private sector.
  Mr. Speaker, this is an important, well-thought-out bill. I urge my 
colleagues to support it.
  Mr. BARCIA. Mr. Speaker, I yield 3 minutes to the distinguished 
gentlewoman from Texas (Ms. Jackson-Lee).

[[Page H5427]]

  (Ms. JACKSON-LEE of Texas asked and was given permission to revise 
and extend her remarks.)
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I thank the gentleman from 
Illinois for his kindness and his leadership; the ranking member, the 
chairman and the committee for their work.
  This is an exciting piece of legislation, and I am delighted to rise 
to support the Technology Transfer Commercialization Act of 1997. I 
certainly think Senators Bayh and Dole were innovative in 1980 when 
their act was first implemented, because it revolutionized the way we 
handle patents arising from Federal research. Until their legislation 
passed, the Federal Government retained title to all patents arising 
from Federal research and granted only nonexclusive licenses to private 
parties. This left no room for competitive advantages and what we wound 
up with was these 20,000 Federal inventions sitting in laboratories, 
underutilized and unused.
  As a result of the Bayh-Dole policy, current policy is to get these 
inventions out to the private sector, either by licensing government-
developed technology or by letting a university or company who made the 
invention with Federal funds have the patent outright. Out of that we 
have gotten new medicines and materials and processes, and ideas for 
products are flowing.
  However, I believe as we move into the information age, we can do 
better. We have learned a lot about licensing since 1980, and 
therefore, I think it is crucial that this new amendment and 
legislation conforms our patent policies to our new sensibilities. It 
takes lessons learned over these 18 years as well as the legitimate 
concerns of licensees, and streamlining our patenting and licensing 
procedures to reflect 21st century realities.
  What I really like about it is this is a real dynamic opportunity for 
our small businesses. This is a job creation bill, for the small 
businesses now will have the first crack, as they have in the past, but 
they will have a real opportunity for the licenses and a substantial 
portion of the jobs arising from commercializing Federal inventions 
will have to be located right here in the United States. I think it is 
a match made in heaven.
  The small business preference works, because there are so many 
innovative technological firms that are small businesses and, in fact, 
generate a lot of jobs. This helps them to get right to the source of 
opportunity and to create more jobs and to create high technology. In 
fact, I understand that over 90 percent of NASA's licenses typically go 
to small businesses, many of which reside in my community.
  H.R. 2544 also carefully devices ways to make sure that the ideas of 
all companies with an interest in commercializing an invention are 
considered before rights are awarded. H.R. 2544 also makes crucial 
adjustments to CRADA, a process by which companies can do joint 
research with the Federal laboratories. Again, here is another 
opportunity where there is joint venturing and partnerships between our 
Federal laboratories.
  Mr. Speaker, as I said earlier, this is a bill for the 21st century. 
I am very proud to support this bill as well as on behalf of our small 
businesses in America, and technology.
  Mr. Speaker, I rise in support of H.R. 2544, the Technology Transfer 
Commercialization Act of 1997. This bill is important to me for a 
number of reasons. It strengthens a program of great importance to 
small business, and it is key to helping U.S. companies harvest the 
bountiful ideas of Federal laboratories.
  This bill amends the Bayh-Dole Act of 1980, which revolutionized the 
way we handle patents arising from Federal research. Until Bayh-Dole 
passed, the Federal government retained title to all the patents 
arising from Federal research and granted only non-exclusive licenses 
to private parties. This policy left no room for competitive advantages 
and led to 20,000 Federal inventions sitting in laboratories 
underutilized and unused.
  As a result of Bayh-Dole, current policy is to get these inventions 
out to the private sector either by licensing government-developed 
technology, or by letting the university or company who made the 
invention with Federal funds have the patent outright. New medicines, 
materials, processes, and ideas for products are flowing from the 
government to the private sector as never before.
  But we can do better. We have learned much about licensing since 
1980. Businesses have also changed dramatically in this period. Product 
marketing and quality is much better now. There has been a 
communications revolution and business decisions must be made very 
quickly. Today's high-technology businesses simply do not have the time 
to produce mounds of paperwork and wait months to license a Federal 
invention.
  H.R. 2544 conforms our patent policies to our new sensibilities. It 
takes the lessons learned over these 18 years as well as the legitimate 
concerns of licensees, and streamlines our patent licensing procedures 
to reflect 21st century realities.
  This bill also preserves what is good about Bayh-Dole. Small 
businesses still will have first crack at the licenses, and a 
substantial portion of the jobs arising from commercializing Federal 
inventions will have to be located right here in the United States. 
This is a small business preference that works. I understand that over 
90% of NASA's licenses typically go to small businesses, many of which 
reside in my district. H.R. 2544 also carefully devises ways to make 
sure that the ideas of all companies with an interest in 
commercializing an invention are considered before rights are awarded.
  H.R. 2544 also makes crucial adjustments to the CRADA process by 
which companies can do joint research with the Federal laboratories. It 
retains all of the provisions which permit small businesses easy access 
to federal laboratories, but it also sets up a careful review of those 
CRADAs that are large enough or prominent enough to raise national 
security, antitrust, or international competitiveness issues.
  Mr. Speaker, this bill represents hard and fruitful work on the part 
of my colleagues from both sides of the aisle, and from the 
Administration. I urge all of you to support this important 
legislation. Thank you.
  Mr. BARCIA. Mr. Speaker, having no additional speakers on our side, I 
yield back the balance of my time.
  Mrs. MORELLA. Mr. Speaker, for nearly two decades, Congress and the 
Science Committee has encouraged the transfer to United States private 
industry of unclassified technology created in our federal 
laboratories.
  As a result of these technology transfer laws, the ability of the 
United States to compete globally has been strengthened and a new 
paradigm for greater collaboration among the scientific enterprises 
that conduct our Nation's research and development--government, 
industry, and universities--has been developed. By permitting effective 
collaboration between our Federal laboratories and private industry, 
new technologies can be rapidly commercialized.
  Federal technology transfer stimulates the American economy, enhances 
the competitive position of United States industry internationally, and 
promotes the development and use of new technologies developed under 
taxpayer funded research so those innovations are incorporated rapidly 
and effectively into practice to the benefit of the American public.
  Our Federal laboratories have long been considered one of our 
greatest scientific research and development resources, employing one 
of every six scientists in the country and encompassing one-fifth of 
the country's laboratory and equipment capabilities. Effectively 
capturing this wealth of ideas and technology from our federal 
laboratories, through the transfer to private industry for 
commercialization, has helped to bolster our Nation's ability to 
compete in the global marketplace.
  Given the importance and benefits of technology transfer, the 
Technology Subcommittee has continued to refine the technology transfer 
process to facilitate greater government, university, and industry 
collaboration. In the past Congress, we enhanced and simplified the 
process for Cooperative Research and Development Agreements through a 
bill which I introduced, the National Technology Transfer and 
Advancement Act (P.L. 104-113).
  With the Technology Transfer Commercialization Act, we have now 
attempted to remove the obstacles to effectively license federally-
owned inventions which are created in government-owned, government-
operated laboratories, by adopting the successful Bayh-Dole Act as a 
framework.
  Under the bill, agencies would be provided with two important new 
tools for effectively commercializing on-the-shelf federally owned 
technologies--either licensing them as stand-alone inventions, under 
the bill's revised authorities of Section 209 of the Bayh-Dole Act, or 
by including them as part of a larger package under a Cooperative 
Research and Development Agreement. In doing so, this will make both 
mechanisms much more attractive to United States companies that are 
striving to form partnerships with federal laboratories.

  In the Technology Subcommittee's two legislative hearings on H.R. 
2544, witnesses enthusiastically endorsed the bill's intent to 
streamline technology licensing to make it more effective. We heard 
from the Administration, large corporations, small businesses, federal 
laboratories, and technology transfer organizations, among others, that 
the bill will

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substantially improve the process of licensing federal technology for 
commercial applications and make it more attractive for industry to 
partner with government.
  The bill before us represents a bipartisan consensus. I am pleased 
that we have worked closely with the members of the Minority in 
revising the bill since it was originally introduced. I would also like 
to thank the Chairman and Ranking Member of the Science Committee, Mr. 
Sensenbrenner and Mr. Brown, as well as the Ranking Member of the 
Technology Subcommittee, Mr. Barcia, for their support of H.R. 2544.
  I look forward to working with them and my Senate counterparts to 
have this bill signed into law before the conclusion of the 105th 
Congress. I urge all of my colleagues to pass this important measure.
  Mr. SENSENBRENNER. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Wisconsin (Mr. Sensenbrenner) that the House suspend the 
rules and pass the bill, H.R. 2544, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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