The United States government can use any patented invention, copyright, or protection of plant variety, original design or semiconductor design, subject to providing compensation of the owner of the right, under 28 U.S.C. §1498.
Recently there has been renewed interest in using §1498 as a compulsory licensing mechanism for drug patents. Beginning in 2001, there have been at least four efforts to do this, the most recent involving patents on sofosbuvir (Sovaldi) based hepatitis C virus (HCV) treatments. In each case, the relevant agencies have expressed opposition to the use of §1498, partly on the grounds of the risks associated with compensation for the non-voluntary use.
KEI’s position has been that §1498 can and should be used as a tool to obtain less expensive versions of drugs (in some settings), including HCV drugs, but also that the statute was not designed for this use, and that (a) the Congress should consider amendments to §1498 so that it is better suited to dealing with cases of excessive drug pricing, or (b) modify the existing Bayh-Dole march-in statute to apply to non-government -funded inventions for biomedical technologies regulated by the FDA, or (c) to adopt a new compulsory licensing statute. In short, using §1498 can be better than the status quo, but going forward, a better legal basis for compulsory licensing is needed.
In 2015, Senator Bernie Sanders proposed a narrow but important amendment to §1498, in order to enable the Department of Veterans Affairs to use §1498 with more favorable terms for the government on the compensation to patent holders. Sen. Sanders’ proposal (see below) is worth reviewing for persons following this issue.
This page provides some background and context for the §1498 discussions.
For initial context see:
- 2017:1 KEI Briefing Note: Bayh-Dole Act and difference between March-In Rights and the world wide royalty free rights in patents
- Feb. 24, 2017 Compulsory Licensing Workshop – Panel Discussion, 28 U.S.C. § 1498
- History of 28 USC § 1498, as reported in Zoltek Corp v US (2009-5135), March 14, 2012
- KEI’s 8.5 minute informative primer video on 28 USC § 1498
- Overview of U.S. norms for compensation under 28 USC § 1498
There have been a large number of cases where §1498 has been used, and links will be added as we develop this page. Below are a few important cases for medical technologies, where the use of §1498 was considered, but not used.
2001 – CIPRO case
2005/2006 – Tamiflu case
- CPTech page on Tamiflu compulsory licensing requests.
- Senator Schumer Press release calling for use of 28 USC § 1498 to authorize generic manufacture of oseltamivir (TN: Tamiflu), October 16, 2005.
- Brian T. Yeh, Influenza Antiviral Drugs and Patent Law Issues, CRS Report to Congress. November 18, 2005.
- Brian T. Yeh, Influenza Antiviral Drugs and Patent Law Issues, CRS Report to Congress. Updated December 22, 2006.
2006 – Avastin case
- February 21, 2006 letter from Representative Dennis J. Kucinich to Secretary of the Secretary of the Department of Health and Human Services Mike Leavitt, asking for a compulsory license on the patents for the cancer drug Avastin, using 28 USC §1498.
Recent Proposals for use of §1498 on HCV Patents
Our main concern about the recent HCV proposals is that risks and challenges of setting compensation under 28 USC § 1498 are not always sufficiently explored. One exception is the 2015 proposal by Senator Sanders in the context of veterans.
2014 – Early discussions of using §1498 and other mechanisms for HCV drugs.
- 2014:1 KEI Policy Brief: Nonvoluntary use of patents for drugs to treat the Hepatitis C Virus in the United States: Mechanisms available to the Federal Government, State Governments and Private Actors, July 18, 2014.
- Written Testimony of Robert Weissman (President, Public Citizen) before the Committee on Veterans’ Affairs U.S. Senate, “Hepatitis C in Veterans,” December 3, 2014.
2015 – Veterans’ Affairs case involving HCV drugs.
- Letter from Senator Bernie Sanders to the VA, asking for compulsory licenses on Hepatitis C drugs, May 13, 2015.
- Sanders offers amendment to create compulsory licenses on medical inventions for veterans, July 24, 2015.
- Senator Bernie Sanders proposal to expand veterans’ access to patented medical inventions, September 20, 2015.
2016-2017 – More commentary on HCV and §1498.
- Sarah Jane Tribble, “Louisiana proposes tapping a century-old patent law to cut hepatitis C drug prices,” Washington Post, May 2, 2017.
2018 – Congressional letter on HCV.
- 18 members of the House of Representatives call for compulsory license on patents for HCV treatments, February 20, 2018.
Selected blogs and articles
- 1967, Gerald J. Mossinghof, Robert F. Allnutt – “Patent Infringement in Government Procurement: A Remedy Without a Right”
- 1968, J. Edward Welch – “Patent Infringement in Government Procurements: GAO’s Role”
- 1974, William Brownell Humphrey – “A history and analysis of section 1498 of title 28 of the United States Code dealing with unlicensed use of patents by the United States government and its effect on procurement”
- 1995, Lionel Marks Lavenue (University of Georgia Law) – “Patent Infringement Against the United States and Government Contractors Under 28 U.S.C. § 1498 in the United States Court of Federal Claims”
- 2007. Amanda Mitchell, Tamiflu, the Takings Clause, and Compulsory Licenses: An Exploration of the Government’s Options for Accessing Medical
Patents, 95 Cal. L. Rev. 535 (2007). Available at: http://scholarship.law.berkeley.edu/californialawreview/vol95/iss2/5
- 2015. Federal Circuit Reinforces Broad Reach of 28 U.S.C. § 1498, Wiley Rein, LLP. September 21, 2015. Concerns Astornet Technologies Inc. v. BAE Systems, Inc., No. 14-1854 (Fed. Cir. Sept. 17, 2015).
- 2015. Dennis Crouch. Can the U.S. Government Infringe a U.S. Patent? (The U.S. Government Says it’s Impossible), PatentlyO.Com. September 20, 2015. Also regarding Astornet Technologies Inc. v. BAE Systems, Inc., — F.3d —- (Fed. Cir. 2015).
- 2016. Amy Kapczynski and Aaron S. Kesselheim, Government Patent Use’: A Legal Approach To Reducing Drug Spending, Health Affairs, Vol. 35. No. 5. Published May 2016.
- 2017. Hannah Brennan, Amy Kapczynski, Christine H. Monahan, Zain Rizvi. A Prescription for Excessive Drug Pricing: Leveraging Government Patent Use for Health Yale Journal of Law and Technology Volume 18 | Issue 1 Article 7
2017. Judge Mary Ellen Coster Williams and Diane E. Ghrist. Intellectual Property Suits in the United States Court of Federal Claims. Law Landslide, Volume 10, Issue 1.