NIH license terms for ddI -- interesting information

[James Love <love@cptech.org>]

I have just located a copy of the NIH/BMS license for ddI, and can
report the exact language for the patent term, the reservation of
rights for public use (including use by foreign governments or
international organizations like WHO), the reasonable pricing
clause, and the 15 countries where BMS has foreign rights to the
patent.

The initial exclusivity term for the license was 10 years,
beginning in February 1, 1988.  BMS had the option of requesting
a 5 year extension of the exclusivity term last year, but that
request was conditioned upon merit, supported by BMS's "past
activity under the exclusive license and the manner in which the
needs of the public health and safety will be met under such
extension."  We have asked DHHS to provide us with information
regarding the granting of any extension of the exclusivity of the
license, and we are also trying to determine if there was public
notice.

Perhaps more interesting for some will be Paragraphs 3.1 and 3.2
of the license.  Paragraph 3.1 gives the US government the right
to use the patent or to grant licenses to the World Health
Organization or any foreign government.  Paragraph 3.2 permits
the government to issue additional licenses if BMS cannot
demonstrate, with evidence, that there is a reasonable
relationship between the pricing of ddI and the health and safety
needs of the public.  This provision could be used right now to
speed the introduction of generic version of ddI in the US
market.


     3.1  The licenses granted in Article II above are subject to
          the reservation by NTIS of an irrevocable,
          nonexclusive, nontransferable, royalty-free license for
          the practice of all inventions encompassed within the
          Licensed Patent(s) throughout the world by and on
          behalf of the Government and on behalf of any foreign
          government or international organization pursuant to
          any existing or future treaty or agreement to which the
          United States is signatory, including the right to
          engage in research on inventions including under the
          Licensed Patent(s) either alone or with one or more
          third parties.


     3.2  LICENSEE acknowledges the concern of the Government
          that there be a reasonable relationship between
          LICENSEE's pricing of Licensed Product and the health
          and safety needs of the public and that this
          relationship be supported by evidence.  If, during the
          exclusive marketing term of this Agreement, as provided
          under Paragraph 2.1 above, LICENSEE fails to provide
          such evidence upon reasonable request of the Director,
          Division of Cancer Treatment, National Cancer
          Institute, NTIS has the right to require LICENSEE to
          grant sublicenses under Licensed Patent(s) to
          responsible applicants on reasonable terms when
          necessary to fulfil health and safety need.  It is
          agreed that such evidence will be treated in a
          confidential manner.  Any requirement to grant
          sublicenses shall be deemed a modification of this
          agreement and shall be subject to the provisions of
          Paragraphs 9.2 and 11.4.

Finally, on the version of the license that I have, BMS is
granted foreign patent rights for only 15 countries: Japan,
Australia, Austria, Belgium, France, Italy, Luxembourg,
Switzerland, Sweden, the Netherlands, UK, West Germany, Ireland,
Israel and New Zealand.  All of Eastern Europe, Africa and Latin
America are excluded, as are all of Asia except for Japan and all
of the Middle East except Israel.


  Jamie Love <love@cptech.org>


-- 
James Love
Consumer Project on Technology
http://www.cptech.org
love@cptech.org
202.387.8030; fax 202.234.5176