Female Entrepreneurs Need Intellectual Property Protections
As a woman who has spent her career as a serial entrepreneur and fighter for women entrepreneurs, I was appalled to read a recent letter from 100 members of Congress calling on Health and Human Services Secretary Xavier Becerra to take action that would gut intellectual property protections at the core of the American innovation ecosystem.
Even as the advances of women have shattered glass ceilings throughout our society and economy, the stubborn legacy of male-dominated entrepreneurial culture has been a tough nut to crack.
It may be hard to believe, but venture capital financing for women-owned startups peaked at 2.8% of total venture funding in 2019 and has actually declined to 2.3% since then.
It will take historians decades to untangle all the reasons underlying this persistently gross inequity. But as a society, we should agree that moving forward requires extending the opportunities this ecosystem offers in full to women entrepreneurs — not undermining opportunity for everyone.
The letter's signatories, led by Sen. Elizabeth Warren and Rep. Lloyd Doggett, believe brand-name drug prices are too high. They urge Secretary Becerra to use the authority he supposedly has under the Bayh-Dole Act of 1980 to "march in" on patent rights for drugs developed with the support of public funds — or alternatively, to use the supposed general licensing authority the government retains over patents under 28 U.S.C. § 1498 to offer licenses to companies for cheaper generic copies.
In fact, the legality of either move is quite dubious and would quickly meet challenges in court. But it would also send a signal that many in government are prepared to undermine the policy fundamentals that make American innovation tick — and not just for pharmaceuticals, but across the tech economy in computers, robotics, artificial intelligence and more. "March in" would have devastating consequences for venture investment in innovation.
The irony here is that the main provision lawmakers want Secretary Becerra to invoke is part of a law that has done more than anything to open up American innovation. In fact, The Economist Technology Quarterly 20 years ago heralded Bayh-Dole as "possibly the most inspired piece of legislation to be enacted in America over the past half century.
Before Bayh-Dole, the intellectual property rights to inventions that researchers made with the support of public dollars stayed with the government. While that centralized system promoted basic research, it did nothing to incentivize the development of new research into commercial products.
Bayh-Dole deliberately redesigned this structure to decentralize management of intellectual property. It gave universities the patent rights to their labs' research and allowed them to license those rights to private companies for development. Bayh-Dole sparked a new generation of technological advance in fields ranging from biopharmaceuticals to machine vision. The legislation is responsible for the creation of over 15,000 startups and has contributed up to $1 trillion to U.S. GDP.
As a nation, we want more such activity, not less. And we want women to share in it fully.
Women-founded firms are hard at work on new treatments for drug-resistant cancers and therapies that boost a patient's immune system to fight cancers like melanoma and lymphoma. Privo Technologies is one such woman-founded firm developing novel approaches to fight notoriously difficult-to-treat mucosal cancers of the mouth and throat.
Intellectual property protections are the bedrock of this system. Without secure patents and licenses, women-led start-ups will have no chance of finding funding. These are not companies with existing revenue streams on which they can draw. At this stage, the value of these firms is all in the security of their intellectual property — along with their human capital to develop and commercialize it.
A new generation of women entrepreneurs is ready to step up. Our basic approach to innovation should simply be "the more the better." Unfortunately, calls to misuse Bayh-Dole's march-in provision or Section 1498 would worsen the current exclusion of women from the entrepreneur community. After all, no one will undertake funding startups if they are staring into price controls or premature generic licensing for the products developed. Such government hijacking of their intellectual property would prevent them from making a return when their risky ventures succeed.
Secretary Becerra would be well advised to turn down this opportunity to poison the ecosystem just as women are getting ready to enrich it in numbers.
Rose Wang is a serial entrepreneur and serves on the board of the Bayh-Dole Coalition.
