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Sunday, October 22, 2006

BYU Gets Aggressive: The Lawsuit against Pfizer

BYU is suing Pfizer, the pharmaceutical giant, claiming that BYU was cheated out of a share of the massive revenues that resulted from sales of Celebrex, the anti-inflammatory medication that grew out of the inventions of BYU's Professor Daniel L. Simmons. See details in articles at the Salt Lake Tribune and also the Deseret News (with a hat tip to Julie Smith at Times and Seasons). According to the Deseret News, "The complaint alleges both fraud and misappropriation of trade secrets and says BYU and Pfizer's predecessor company Monsanto had a contract to develop such drugs together. The pharmaceutical company instead terminated the contract 'under fraudulent pretenses,' hid information that BYU was entitled to about patents and profited handsomely while shutting the university out, the lawsuit says."

While I cannot say anything about the merits of BYU's case, as a patent strategist and research scientist in a major corporation, and as a former professor (Institute of Paper Science and Technology, now part of Georgia Tech), I can say that many universities have gone from being rather naive and gullible, when it comes to intellectual property, to being sophisticated and aggressive. Part of this is an outgrowth of the the Bayh-Dole Act of 1980 which requires universities to actively protect and retain the intellectual property resulting from federally funded research. While the act may not directly affect much of the work done at private universities like BYU, it has led to a dramatic change in the policies, attitudes, and programs in universities across the nation, with spillover effects for international universities as well.

BYU has one of the nation's best Technology Transfer Departments, in my opinion. They have done excellent work in helping professors to seek patent protection for their inventions and in helping to find commercial partners to license BYU inventions. BYU also generates a lot of startups. BYU is among the top universities in terms of patents, licensing revenues, and start-up companies generated per dollar of research money invested. And the recent law suit against Pfizer shows that the University is serious about its intellectual property. Could the lawsuit scare off some companies who might fear that a university partner will sue them later? I doubt it, unless the company is hoping to take advantage of the university.

My corporate experience shows me that collaboration with universities will become increasingly important in this world of "open innovation." And success for any corporation in the long run will require working hard to respect the rights of universities or other partners, ensuring that deals are more than just fair, but provide positive win/win outcomes that will make the corporation be viewed as a partner of choice for future innovations. It's something my employer is working hard to do ("partner-friendly intellectual assets"), and something that many others must do to succeed.

While universities have made a lot of progress, there is still a need for professors and students to better understand intellectual property. The rush to publish research is often antagonistic to intellectual property protection. I encourage students and professors alike in any technical area to invest some time in understanding the basics of patents and other forms of intellectual assets in order to recognize inventions and pursue appropriate protection.

2 comments:

BRoz said...

There may be a silver lining in all this. Pfizer and Merk rightly get all the blame for Celebrex and Vioxx. However, the idea of selectively blocking COX-2 is not what causes heart attacks. Vioxx and Celebrex affect other receptors and mediators other than COX-2.

Dr. Simmons is unquestionably recognized by the scientific community as the discoverer of COX-2 and obviously realized that selective inhibition would prevent gastric irritation.

According to Dr. Simmon, BYU told him, “you can’t patent a receptor!” He then sent samples of his cloned receptors to a college at U of Rochester who went ahead and patented everything right under BYU's nose.

Allegidly, Monsanto advised BYU against getting patents that the company said would be unenforceable and promised to let the university know if something that could be patented came out of the work.

I can attest to how unsophisticated, naive, and risk adversive BYU’s office of technology transfer was. BYU was an extremely difficult place to file a patent. If you had an invention packaged for resale that was one thing, but as for other utility patents,that was another story altogether. They have since replaced people.

Mormanity said...

Good insights. Yes, there have been dramatic changes in the tech transfer area - not just at BYU, but at many universities. I'm quite impressed with what they are achieving at BYU now.