As the World Health Assembly (WHA) approaches in late May, WHO members will discuss a proposed resolution on transparency. The U.S. Congress is also considering a number bills that would require greater transparency, and groups like KEI have asked the NIH, BARDA and other federal agencies to be more transparent about licensing policies.
In evaluating how much transparency is appropriate in licensing of patented inventions, policy makers should consider the extensive transparency regarding the leasing of public lands to the the oil and gas industry.
The National Petroleum Reserve (NPR) lease sales in the State of Alaska provide a useful illustration of how an industry that faces significant risks and large upfront capital costs for exploration, also functions with far more transparency.
Using the Alaska Case Retrieval Enterprise System (ACRES) search tool, available at the U.S. Department of Interior Bureau of Land Management website, it is possible to obtain the royalty rate agreed for NPR leases, the size of the land leased, and payments made by the lessee company – down to the exact dollar amount.
The ACRES search tool is available here: https://sdms.ak.blm.gov/acres/acres_menu
Queries are based on lease serial numbers. A list of lease serial numbers, sorted by companies and updated up to March 2019, is available here: https://www.blm.gov/sites/blm.gov/files/uploads/OilandGas_Alaska_NPR-A_LeaseReport_March2019.pdf
According to the information available, ConocoPhillips Alaska has a total of 167 leases covering 1,081,767 acres. This is the company with the largest operation in the State of Alaska, both in terms of number of leases as well as acreage. It is followed by NORDAQ Energy Inc, which has 19 leases covering 217,424 acres.
The ACRES search tool has detailed information for each one of these contracts, tabulated in a section the system calls “abstract.” For instance, one of the most recent leases signed by ConocoPhillips Alaska is identified with the serial code AA095402. According to the abstract section, this lease was issued on February 2019, covers a total of 11,386 acres, and has a royalty rate of 12 ½%. As of February 25, 2019, the “balance bonus bid” payment was $100,307.00. These reports are updated every week.
Contrast this level of detail with the fact that the NIH refuses to disclose the royalty rate or the royalties paid on licenses to patented inventions, that are negotiated transactions, often involving investors and scientists who are former NIH employees, or colleague and friends of NIH officials.