F E AT U R E

NIH inventions translate into drugs and biologics with high public health impact
Sabarni K Chatterjee & Mark L Rohrbaugh
Compared with other US public-sector research institutions, the US National Institutes of Health has contributed inventions that have had a disproportionately greater impact on the overall number of products produced, drugs granted orphan status and drugs granted priority review.
2014 Nature America, Inc. All rights reserved.

he contribution of inventions from publicsector research institutions (PSRIs) to the development of drug and biologic products has long been recognized13. Until now, however, no study has carried out an in-depth comparison of the specific contributions of the US National Institutes of Health (NIH) Intramural Research Program (IRP) and other US PSRIs to the development of drugs and biologics approved by the US Food and Drug Administration (FDA). In the following article, we analyze the number of products resulting from inventions from these sources (Fig. 1), assess their public health impact, categorize the type of licenses made and the licensee organizations that made them and estimate the funding invested that resulted in drug and biologic products. We show that NIH-IRP inventions have had a disproportionately greater impact in three respects: first, the overall number of products, particularly vaccines, cancer therapeutics and in vivo diagnostics; second, the number of drugs granted orphan status; and third, the number of drugs developed under New Drug Applications (NDAs) granted priority review by the FDA because they offer major advances in treatment. Gross annual commercial sales of these products serve as a limited but direct measure of their economic impact, which for the drugs and biologics that utilize NIH-IRP inventions is double the governments total annual investment in the NIH-IRP.

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Figure 1 Year of approval for all new drug and biologic license applications and for those originating from NIH-IRP inventions. Adapted from ref. 13.

Sabarni K. Chatterjee and Mark L. Rohrbaugh are at the Office of Technology Transfer, US National Institutes of Health, Rockville, Maryland, USA. e-mail: mark.rohrbaugh@nih.gov

The NIHs contribution to drug development The NIH is the largest source of biomedical research funding in the United States. More than 80% of its funds support more than 300,000 research personnel at more than 2,500 universities and research institutions. Approximately 10% of the NIH budget funds research conducted by about 6,000 scientists working in 24 of the 27 NIH institutes and centers (ICs), referred to as IRP (http://www. nih.gov/about/). The central NIH Office of Technology Transfer manages the patenting and licensing of inventions made by scientists in these laboratories, while the IC technology transfer staff reports employee inventions to the OTT and negotiates collaborative agreements with industry.

In 1980, two pieces of legislation were passed in the United States to provide mechanisms and incentives for the transfer of governmentfunded technology to the private sector for commercialization. The Bayh-Dole Act provides grantees and contractors with the right to own and license inventions made with US Government funding (Public Law 96-517, codified at 35 USC 200-212). A similar piece of legislation, the Stevenson-Wydler Technology Innovation Act, later amended by the Federal Technology Transfer Act of 1986, provides US federal government laboratories such as the NIH with the legal authority to patent and license inventions made by government scientists to companies for commercial development (Public Laws 96-480 and 96-480, codified at 15 USC 3701-3714). Using these authorities,

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the NIH technology transfer program passes technologies to the private sector for further research and development, ultimately benefiting the public through the introduction of new products and the resulting economic growth. The value and contribution of publicsector research to commercial activities has been well recognized since the late 1980s13. Such economic studies naturally rely on metrics, which for the patenting and licensing of inventions were not collected systematically from universities until the first annual survey by the Association of University Technology Managers in 1991 (AUTM; http://www.autm. net/Surveys.htm). The first set of AUTM metrics included numbers of inventions, patents, licenses and gross royalties, the last being the only measure associated with successful market launch and sales. In the early reports, AUTM provided examples of representative products brought to the market, and beginning with the fiscal year (FY) 1998 report, they added a metric for the total number of new products having reached the market. In 2006, AUTM began the Better World Project to showcase the impact of particular products developed from university inventions (http://www. betterworldproject.org/). With respect to federal laboratory activities, the US Department of Commerce has reported metrics annually since FY2002 on patenting, licensing, royalty income and Cooperative Research and Development Agreements (CRADAs) with industry. These reports also include a few examples of products developed from inventions made in government laboratories (http://www.nist.gov/tpo/ publications/doc-annual-reports-techtransfer. cfm). Most analyses of technology transfer in the nonprofit sector have looked broadly across academic institutions at early-stage activities as a means to measure the overall impact or to evaluate success and opportunities for improvement. For example, the economic impact of patent and licensing has been calculated from measures of total royalties collected4 (see also http://www.bio.org/articles/ economic-contribution-universitynonprofitinventions-united-states-1996-2010). Other studies have used public data and surveys to analyze patenting and licensing by universities in particular fields, such as DNA technologies5. Over time, disseminations of successful practices and the overall maturation of technologytransfer practices have resulted in the growth of a more entrepreneurial environment in universities6 and emphasis on the broader role of the university technology-transfer office in industrial relations7,8. Few studies have analyzed specific contributions by publicsector research institutions (PSRIs) to biomedical products, in part because the data were not readily available. In addition, measures of productivity and effectiveness in biomedical technology transfer are inherently challenging because the development time exceeds ten years, as measured from the initial invention, through pre-clinical and clinical testing, to FDA drug approval and market launch. Although the ultimate goal of these technology transfer activities is to provide incentives for private-sector development of new products, licensing of inventions by the nonprofit organization involves primarily the early stages of this process. The ultimate success of technology transfer, however, can best be measured by evaluating products reaching the market, by necessity a long-term outcomeand in the case of public-sector institutions, it is an outcome dependent on an infrastructure that is continually evolving. Several studies have analyzed pharmaceutical products developed from US PSRI inventions912, with the most complete listing of drugs and biologics published by Ashley Stevens and colleagues13 in collaboration with us. Another study examined the patenting and licensing of DNA patents from the NIH-IRP relative to that of PSRIs14. However, no previous study has analyzed the specific contributions by the NIH-IRP to FDA-approved drugs and biologics. Providing access to this type of data will allow researchers to conduct further studies to evaluate the relationship between public-sector patenting and subsequent privatesector drug development15. Our previous collaborative study13 found that PSRIs, defined as universities, research hospitals, research foundations and federal laboratories, have had a greater impact on the commercialization of new drugs than was previously realized. The study identified 153 new products on the basis of licenses of inventions from PSRIs that were approved by the FDAs Center for Drug Evaluation and Research (CDER) or Center for Biologics Evaluation and Research (CBER). These include smallmolecule drugs, therapeutic biologics, in vivo diagnostics, vaccines and new indications for existing drugs, which we refer to collectively as drugs13. In this article, we build upon the Stevens et al.13 study and for the first time analyze the NIHIRP contribution of new drugs relative to those of the other PSRIs, collectively referred to here

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Table 1 Drugs developed with inventions from NIH-IRP through 2007

Brand drug (generic) Fludara Videxa Hivida Sporanox Taxol (paclitaxel) NeuTrexin (trimetrexate glucuronate) Havrix Zenapax Synagis (palivizumab) Certiva Vitravene RotaShield Thyrogen (thyrotropin alfa) LYMErix Acutect (sildenafil) NeoTect (technetium 99m depreotide) Twinrix Zevalin Velcade (bortezomib) Kepivance (palifermin) Gardasila Prezistaa,c
aLicensed

Patent FDA approval filing date date 1991 1991 1992 1992 1992 1993 1995 1997 1998 1998 1998 1998 1998 1998 1998 1999 2001 2002 2003 2004 2006 2006 1978 1985 1985 1984 1989 1986 1982 1987 N/Ab 1986 1987 1983 1985 1983 1988 1988 1982 1986 2001 1989 1995 1998

Institute/center National Cancer Institute (NCI) NCI NCI National Institute on Aging NCI NCI National Institute of Allergy and Infectious Diseases (NIAID) NCI NIAID National Institute of Child Health and Human Development (NICHD) NCI NIAID National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK) NCI National Institute of Dental and Craniofacial Research (NIDCR) NIDCR NIAID NCI NCI NCI NCI NCI

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under less than exclusive use for the life of the patent(s) (see main text). bLicensed by NIH as an unpatented monoclonal antibody/hybridoma. cCo-owned with the University of Chicago, Chicago.

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Table 2 FDA-approved drugs from inventions in extramural PSRIs or NIH-IRP categorized according to product type
Product type New chemical entity Biologic Vaccine Over the counter In-vivo diagnostic Total Approved drugs resulting from total number of PSRI inventions 93 36 15 1 8 153 Approved drugs resulting from NIH-IRP inventions 11 (12%) 3 (8%) 6 (40%) 0 2 (25%) 22 Approved drugs resulting from extramural inventions 82 (88%) 33 (92%) 9 (60%) 1 (100%) 6 (75%) 131

as extramural institutions. Data related to the drugs developed from PSRIs were taken from Stevens et al.13 NDA and priority review data for the NIH-IRP drugs and the size of initial licensee companies for extramural PSRIs as a whole were obtained from Ashley Stevens at the Boston University School of Management (Boston). All other data on the drugs developed from NIH-IRP inventions were obtained from internal NIH records. The NIH-IRP data were then subtracted from the totals in the Stevens et al. article to obtain the collective data for all extramural PSRIs. Data for sales of the marketed drugs no longer under license from NIH were obtained from IMS Health16. Our analysis not only provides more detailed information on the NIH-IRP as the largest institutional contributor to the PSRI drugs but also compares drug development outcomes from two distinct types of research programs. The extramural institutions are primarily funded under a competitive peer review system with grants and contracts from federal agencies and foundations. They receive additional funding from state governments, foundations and corporate sponsors. In contrast, the NIHIRP is funded prospectively by the US government to conduct research within the mission of each of the NIH institutes and centers. Unlike recipients of grants and contracts, peer review of each principal investigators laboratory in the NIH-IRP is conducted retrospectively by outside expert review panels17. Results We analyzed the data set in several ways. The first question asked was which FDA-approved

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drug and biologic products originated from inventions in the NIH-IRP. For those NIHIRP inventions that were licensed, we analyzed the type of companywhether a large or small commercial entity or startupholding the initial license. Third, we asked how many of the licenses were for inventions associated with drugs that were given priority review at the FDA (as a surrogate measure of the public health impact of the invention). Finally, we carried out a preliminary comparison of funding in the NIH-IRP and at extramural PSRIs during the period of this study. Characterization of drug products. The list of the 22 drugs developed under licenses from the NIH-IRP is shown in Table 1 along with the date of the first patent filing, the FDA approval date and the NIH institute where the invention was made (http://www.ott.nih.gov/fdaapproved-products; PSRI license data obtained as a personal communication from A. Stevens). Scientists in six different NIH institutes made the inventions that were the basis of these drugs: thirteen inventions were based on research conducted at the National Cancer Institute (NCI), four at the National Institute of Allergy and Infectious Diseases (NIAID), two at the National Institute of Dental and Craniofacial Research (NIDCR) and one each at the National Institute of Child Health and Human Development (NICHD), the National Institute of Aging (NIA) and the National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK). The invention associated with the drug Prezista (darunavir) was jointly invented by scientists at the NCI and the University of

Illinois, Chicago. Another, used in Fludara (fludarabine), was based on an invention made in 1978 by scientists at Southern Research Institute (SRI; Durham, NC, USA) under an NCI grant18. In that pre-Bayh-Dole era, SRI assigned the invention rights to the NIH, and the NCI conducted preclinical and early clinical studies before the NIH licensed it to a company. We credited this technology to the NCI. All of the licenses were or are exclusive in scope, except for the non-exclusive license to a method patent for the use of the HIV antiretroviral drug Prezista, a co-exclusive license to human papilloma virus vaccine technology used in Gardasil (recombinant human papillomavirus (HPV) quadrivalent vaccine; HPV types 6, 11, 16 and 18)the other co-exclusive license led to Cervarix (recombinant human papillomavirus (HPV) bivalent vaccine; HPV types 16 and 18) approved after the period of this studyand 10 years of exclusivity following market launch for both Hivid (zalcitabine) and Videx (didanosine) based on US Department of Commerce policies in the late 1980s for exclusive licenses. The distribution of the 22 drugs into product categories is shown in Table 2 with the number and percentage contribution of the NIH-IRP and the extramural institutions relative to the total in that category. Eleven (12%) of the new chemical entities (NCEs) are based on NIH inventions, three (8%) of the therapeutic biologics, six (40%) of the vaccines and two (25%) of the in vivo diagnostics. The therapeutic categories into which the 22 drugs fall are shown in Table 3 along with the number and percentage contribution of the

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Table 3 Drugs developed from extramural PSRIs and NIH-IRP inventions categorized by therapeutic categories
Drugs developed from NIH-IRP inventions Therapeutic area Oncology Infectious disease Cardiology Immunology Others Total Drugs developed from total PSRI inventions 40 36 12 6 59 153 Number 8 12 1 1 0 22 Percentage of total PSRI inventions 20% 33% 8.3% 17% 0 14% Drugs developed from extramural research Number 32 24 11 5 59 131 Percentage of total PSRI inventions 80% 67% 92% 83% 100% 86%

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NIH-IRP and the extramural institutions to the total in each category. The NIH-IRP accounts for 12 (33%) of the infectious-diseases product categories and eight (20%) of the oncology product categories. There is one drug based on an NIH-IRP invention in each of the fields of cardiology (8%) and immunology (17%). Licensee company size. We identified the companies holding the initial licenses for the products and broadly classified them into primarily three categories: large company (a company with >500 employees); small company (a company with <500 employees); or a startup (a small company newly formed to develop the licensed technology). The distribution of licensees among these three categories is shown in Table 4 (data on PSRI licenses obtained via personal communication from A. Stevens). The NIH does not spin-out or facilitate the formation of startup companies from its technologies, but it does license its technologies to newly formed companies, which are included in this category. The companies were classified based on their status at the time of license execution. Eighteen different companies were NIH-IRP initial licensees of the 22 products. Counting each NIH-IRP license separately, 12 (55%) licenses were with large companies, and 10 (45%) were with small companies of which two (9%) were with startups. It is interesting to note that compared with the extramural PSRIs, NIH has licensed more of these products to large companies and fewer to startup companies. Public health impact. A drug that receives a priority review would be considered by the FDA to have the highest potential therapeutic impact. We analyzed the 143 NDAs from 1990 to 2007 for 107 drugs approved by CDER based on PSRI inventions from our previous study13. A breakdown of the priority review data for the NIH-IRP and the extramural PSRIs (Table 5) shows that NIH-IRP licenses gave rise to 12 (11%) of these drugs, for which 17 (12%) NDAs were filed. All but one of these NDAsthat is, 94%received priority review. The 12 drugs were each developed under at least one priority review NDA. Sporanox (itraconozole) was developed under three NDAs, the last of which was standard, and Videx under four NDAs. The priority reviews for the NIH-IRP drugs fall into two of the seven FDA subcategories. In the new molecular entity (NME) priority review category, the largest for priority reviews, NIH IRP accounted for 27% of the PSRI drugs granted priority review. In the newformulations category alone, as well as among all six categories combined, NIH-IRP accounted for 24% of the PSRI drugs granted priority review. In addition, six (15%) of the 39 PSRI drugs that received orphan status by the FDA used licensed technology from the NIH-IRP. Biomedical research expenditures. One way to compare the relative contributions of the NIH-IRP and extramural PSRIs to this set of commercialized drugs would be to normalize the data on the basis of the relative size of the research budgets. One challenge in this approach, however, is the limited availability of data on total funding for biomedical research at all PSRIs. The US National Science Foundation (NSF) provides data on university and college funding (http://www.nsf.gov/statistics/infbrief/ nsf10329/) and Moses et al.16 and Dorsey et al.19 have reported on biomedical funding in all sectors since 1994. Another challenge is the span of years over which these inventions were made, as relative funding amounts were not constant. Box 1 details our approach to estimating funding for NIH-IRP and PSRIs over the period of this study. For the years 19871989, NIH funding for the NIH-IRP was stable and averaged 12.6% of that for the the total funding for both the NIHIRP and extramural PSRIs. This relative proportion of funding was not constant through the 1990s but declined with time such that the percentage of NIH funding for the NIH-IRP was 11.2 of all NIH research funding by 2001 (all extramural awards: number of awards and organizations funded, by organization type 2001; http://report.nih.gov/catalog_results. aspx?refUrl=index&sS=search&sI=&sP=2& sM=&sA=&sD=7&sV=&sY=2001). In 1995, the earliest year for which complete information is available, NIH funding to extramural PSRIs represented 64% of their total biomedical research funding16 and the NIH-IRP budget19 represented 8.2% of the total biomedical research funding to extramural PSRIs. DISCUSSION Comparing the NIH-IRP contributions to new drugs with the contributions from US extramural PSRIs, we show by several measures that the NIH-IRP contribution is disproportionately larger in both quantity and quality. The NIH-IRP contributed 14.4% of the total number of drugs brought to the market under commercial licenses from the PSRIs and received 11.2 percent of all NIH research funds to nonprofit research institutions, including federal laboratories, at least 1.14-fold higher than the relative size of its budget. If the actual funding the NIH-IRP (with other sources of funding being negligible) versus only the NIH funding of extramural PSRIs from additional sources was similar to that in 1995, the 14.4% contribution from the NIH-IRP would represent a 1.76-fold higher contribution of drugs than would be expected given the relative size of its biomedical research budget. With respect to product categories, NIH-IRP contributions are disproportionately larger by a factor of at least 3.2 for vaccines, approximately proportional for NCEs, and at least 2.0-fold higher for in vivo diagnostics. The NIH-IRP contribution for nonvaccine biologics may be slightly lower or as high as the contribution from the extramural PSRIs. The NIH-IRP contributions to some medical fields are disproportionately large relative to its level of funding, particularly in oncology (1.6- to 2.4-fold higher) and infectious diseases (2.6- to 4.0-fold higher). The contribution to drugs in the therapeutic category of immunology is also higher (1.4- to 2.1-fold), but slightly lower to roughly proportional in cardiology. In this study, as in our previous study of PSRIs13, we use FDA priority review of drugs as an indicator of relative public health impact, because the FDA grants priority review to drugs that are more likely to provide a major advance in treatment of a condition for which no adequate therapy exists. Over the 18-year period from 1990 to 2007, the FDA approved a total of 1,541 NDA applications but granted priority review to just 348, or 23%, of the applications. US public-sector inventions were the basis of the total approvals, 143 (9.3%) of the drugs receiving approval and 66 (19%) of the 348 of those receiving priority reviews, twice the rate of those from the private and non-US sectors. Nearly half (46%) of NDAs from PRSIs, including NIH-IRP contributed drugs, received priority review; in contrast, one-fifth (20%) of the applications based on
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Table 4 Size of companies executing initial licenses for inventions from extramural PSRIs or NIH-IRP that gave rise to drugs
Total Type of entity Large entities Small entities Startups Total Number 65 65 23 153 Percentage 43% 43% 15% 12 8 2 22 NIH-IRP Number Percentage 55% 36% 9% 14% 53 58 21 132 Extramural Number Percentage 40% 44% 16% 86%

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job creation and disability-adjusted life years. In doing so, the direct financial investments of public and private sectors should not be equated, because the private sector spends 100-fold or more to bring the product to market than the PSRI spends in research directly leading to the invention20,21. The total product sales of licensee companies serves as one limited but direct measure of commercial economic impact. Several products included in this study are no longer on the market, including the drugs Vitravene (fomiversen) and Zenapax (daclizumab) and the vaccines Certiva (a diphtheria, tetanus and pertussis (DTaP) vaccine), Hivid, LYMErix (recombinant OspA vaccine) and RotaShield (although NIH subsequently licensed this technology to the International Medica Foundation (Rochester, MN, USA), which is conducting clinical trials in Africa). Other vaccines are either marketed but no longer under license from NIH (Havrix (inactivated hepatitis A vaccine) and Twinrix (inactivated hepatitis A vaccine and recombinant hepatitis B surface antigen vaccine)) or are now generic products. For drugs and biologics still under license from NIH, companies reported combined net sales in 2010 of $4.7 billion in the licensed

Table 5 Number of NDAs for drugs developed from inventions from extramural PSRIs or NIH-IRP categorized by types of priority review
Number of drugs (percentage) Extramural NIH-IRP Total 95 (89%) 12 (11%) 107 Number of NDAs (percentage) 126 (88%) 17 (12%) 143 Number of priority NDAs (percentage) 50 (76%) 16 (24%) 66 Number of priority new formulations (percentage) 13 (76%) 4 (24%) 17 Number of priority NMEs (percentage) 32 (72%) 12 (27%) 44

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private-sector and non-US inventions were granted priority review14. Approximately 38% of NDAs from extramural PSRIs, excluding the NIH-IRP contributed drugs, received priority review. An important distinction can be seen in relative number of priority reviews for the NIH-IRP drugs, all of which had at least one NDA priority reviewoverall a rate of 94%, far exceeding the 38% overall rate for extramural PSRIs. In fact, the NIH-IRP drugs accounted for about one-quarter of the PSRI priority reviews, including the subcategories of new formulations and new molecular entities (NMEs). From the perspective of sources of technologies, the NIH-IRP drugs accounted for 1.1% of the total NDAs, yet received 12 (5.7%) of the 209 priority reviews for new molecular entities,

4 (4.0%) of the 99 for new formulations and 16 (4.6%) of the overall 348 priority reviews. Drugs developed from NIH-IRP inventions are represented among drugs receiving priority review at a rate 2.5 times higher than those from extramural PSRI inventions, and 4.7 times higher than those solely from the private and non-US sectors. Although representing a small fraction of all drug inventions, NIH-IPR technologies have contributed substantially to meeting otherwise unmet public health needs. The NIH core mission, to seek fundamental knowledge about living systems and apply that knowledge to enhance public health, has had a positive impact on the economy as well. There are various ways to estimate the economic impact from the introduction of a new commercial product reaching the market, including

Box 1 Estimating funding at PSRIs and NIH

To derive a reasonable approximation of the relative funding over this period, we used NIH funding data over a three-year period centered on the average year in which patents were filed. The estimated biomedical research budget of the extramural institutions was calculated for 1987 through 1989. (Construction grant funding was removed from total extramural award funding.) This three-year period was chosen to calculate a three-year average around the mean and median year 1988 for the filing date of inventions from all PSRIs from 1978 to 2001, the range for the NIH inventions. This range covers 137 of the 153 drugs by excluding not only four inventions for which a patent filing date could not be determined and Synagis that was licensed as an unpatented biological material but also 11 that were filed before January 4, 1978, the date of the first NIH invention patent filing in this study. The patent filing date serves as a proxy for the year in which the inventions were made and thus funded. The dates of the initial patent filings for the NIH inventions range from 1978 to 2001. During this period, both the mean and average years for all PSRI patent filing dates were 1988. With a lack of data on total biomedical funding at PSRIs for this period before the mid-1990s, one can only calculate the minimum relative size of biomedical research budgets on the basis of NIH funding data. Moreover, the actual proportion of funding for the NIH-IRP must be lower because the calculation would include all extramural sources of biomedical research funding, such as other federal agencies, state governments, private foundations and corporate-sponsored research. The approach we took for this study as a reasonable comparative analysis involves setting an overall minimum for the relative biomedical research funding of intramural versus extramural PSRIs from the 1980s through the early 2000s when these inventions were made, while recognizing that the actual number must be higher, perhaps as high as indicated by funding in 1995. Annual NIH funding data for non-profit institutions was obtained from Research Portfolio Online Reporting Tools (RePORT) http://report.nih.gov and for the NIH-IRP from the Office of Budget website http://officeofbudget.od.nih.gov/history.html The relative NIH contribution to all biomedical funding at nonprofit institutions during this entire period is not known; however, the NSF reports that federal funding to US academic institutions in 1992, the earliest year for publicly available survey data, accounted for 59% of their total science and engineering research expenditures (see Table A-4, http://www.nsf.gov/statistics/rdexpenditures/ dst/92ttwks.html). The earliest year for which data were available on the percentage of NIH funding as a fraction of all PSRI funding was 1995, in which the NIH awarded $6.80 billion in research funding to US universities and colleges and $1.84 billion to other US nonprofit institutions (http://report.nih.gov/FileLink.aspx?rid=879). Moses et al.15 reported that US universities and colleges received $10.7 billion in biomedical research funding from all sources in 1995. NIH funds thus account for 63.6% of that total funding. On the basis of the relative proportion of NIH funding to total biomedical funding for universities and colleges, one can estimate that the total research funding for other PSRIs was $2.89 billion, resulting in a total of $13.6 billion in funds for all extramural biomedical research institutions. The NIH-IRP budget in 1995 was $1.22 billion, or 8.23% of the estimated total NIH-IRP and extramural PSRI biomedical funding.

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territories, which are not worldwide in every case. For drugs and biologics that are no longer under license from NIH, the total global net sales amounted to $2.2 billion in 2010 on the basis of data provided by consultants IMS Health (Parsippany, NJ, USA)16. Therefore, adding these two figures together, the total global net sales in 2010 of drugs using inventions developed by the NIH-IRP amounts to at least $6.9 billion, which, even by this limited economic measure of economic impact, exceeds the entire budget for the NIH-IRP in fiscal year 2010 of $3.3 billion by more than twofold. Differences in how PSRIs and the NIH-IRP program engage companies may affect the proportion of licenses to small businesses. The technology-transfer laws governing NIH-IRP technology transfer are similar to those governing extramural PSRI activities, but there are a few differences. For example, NIH does not have a mechanism to license future inventions outside of a CRADA collaborative relationship. For the vast majority of NIH inventions, which do not result from CRADAs, an exclusive license must be preceded by a public notice of intent to grant the license and consideration of any license applications submitted in objection to the proposed license. Although this rarely results in an objection to granting the license under the proposed terms, it does add risk and delays for startup companies, which are under pressure to move quickly to satisfy investors expectations. Unlike the NIH-IRP, other PSRIs may actively participate in the formation of a company around the institutions inventions and thus be more involved with startup or spinoff companies. The proportion of licenses to large and small companies varies between NIH-IRP and other PSRIs, perhaps in part because of differences in laws and policies or types of technologies. Extramural PSRIs licensed 40% of their drug technologies to large companies (A. Stevens, personal communication) and the Association of University Technology Managers (AUTM; Deerfield, IL, USA) reported that member institutions granted 36% of their licenses to large companies in 2006 (http://www.autm. net/Surveys.htm). By correlating the size of the companies with the type of disease indication in the drug data set, we found that 9 out of 11 NIH inventions in the infectious-disease category were licensed by large entities, including 3 of the 5 vaccine technologies. This is consistent with data from the extramural institutions where 5 of 9 vaccine technologies were licensed to large companies. It may be that larger companies during the period of the study were more willing to accept the higher risk and lower profit margin in developing vaccine and other infectious-disease products relative to small-molecule drugs22. Two of the NIH vaccines, RotaShield and LYMErix, were voluntarily withdrawn from the market because of concerns about adverse events or low market uptake. Interestingly, the eight oncology technologies were all licensed by small companies, two of which were startups. Several factors may account for the success of the NIH-IRP technology transfer program, particularly in oncology, infectious diseases, orphan-drug designations and FDA priority reviews. First, the NCI has the largest research budget among NIH ICs, and the NIAID has moved from third to second largest in the past 10 years. Together, their scientists are the source of the inventions for 17 of 22 NIH drugs23. Other factors that may play a role are the historically strong technology development programs for drugs and vaccines in these two institutes, NIH research programs for rare and neglected diseases (http://rarediseases.info.nih.gov) and the establishment of an effective technology transfer program for NIH in the late 1980s. Even before that time, a few NIH-IRP technologies were patented by the NIH and licensed by the US Department of Commerce on behalf of the NIH. During that period of the 1980s and early 1990s, by contrast, many universities had not yet established technology transfer programs (FY2006 AUTM survey, http://www.autm.net/Surveys. htm). As the largest biomedical research program in the United States, the NIH-IRP would be expected to make an important contribution. However, our analysis shows that the impact is disproportionately large, as measured relative to the amount of funding it has received. This is not to say that some individual research institutions have not made perhaps an even greater impact relative to their research budgets, but that the impact of the NIH is the largest relative to that from all extramural PSRIs. One factor to consider is whether the level of basic versus applied research performed in the NIH-IRP relative to extramural institutions has affected the number of inventions and thus the product outcomes. NSF measures of the proportional funding for applied and basic research by the US Department of Health and Human Services (HHS), of which NIH is the largest research component, are quite similar between the intramural and extramural funding components for 20072009, the only years for which this comparative data are available. The average proportion of funding for basic research in the HHS intramural research programs for these three years was 54.2%. The average proportion of funding for basic research at universities, colleges and other non-profit US institutions was nearly identical at 54.3%. Developmental research represented only about 0.5% of funding, and the remaining portion supported applied research. (NSF Science and Engineering Indicators, FY2007 Table 4-30 http://www.nsf.gov/statistics/ seind08/pdf_v2.htm; FY2008 Table 4-20 http://www.nsf.gov/statistics/seind10/appendix.htm; and FY2009 Table 4-31 http://www. nsf.gov/statistics/seind12/appendix.htm). We believe it is not likely that there was sufficient divergence in the balance of basic and applied research funding for the NIH-IRP versus that for extramural non-profit institutions to have had a major impact on the reported outcomes in this study. Instead, the disproportionate contribution of the NIH-IRP to new drugs and biologics may be related to its resources and structures. The strength of the NIH-IRP lies in scientists who have had high-quality resources to explore and quickly advance new approaches to addressing biomedical challenges in a relatively stable funding environment in the past17. Perhaps this structure provides scientists working on cutting edge research with a greater ability to engage in high risk, potentially high gain, research. When new inventions were made in this environment, a high-quality technology transfer infrastructure was in place to manage their protection and transfer to the private sector. PSRIs as a whole have increasingly adopted successful practices that support the development of inventions through entrepreneurial activities. Practices that lead to long-term success continue to be studied and the lessons learned applied to practice. It is also important to keep in mind that this measure of successdrugs and biologics developed under licenses to PSRI inventionsdoes not include other biomedical products developed from NIH-funded inventions and is only one means by which NIHfunded research leads to improvements in public health. In particular, the results of NIH-funded research serve to compel further research using new tools of discovery, inform new disease prevention and treatment strategies, and identify more effective uses of existing therapies. We hope our analysis of the NIH-IRP will illicit further study of the specific conditions that have led to its success and those that will lead to further improvements in technology transfer. Overall, the NIH-IRP and extramural programs supported by various sources of funds, primarily federal sources, each have attributes that should be preserved to meet the challenges facing the United States in providing the best health care to its citizens and in creating jobs to grow the US economy.
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ACKNOWLEDGMENTS We thank H. Feindt (NIH Office of Technology Transfer) for helpful insights on commercial sales of products, J. Duberman (Informationalist, NIH Library) for his assistance in gaining access to publications and sources of data, the NIH Office of Budget for NIH extramural funding data and L. Pressman for her valuable insights. DIsclaImer The statements, findings, conclusions, views and opinions contained and expressed in this article are based in part on data obtained under license from the IMS Health Incorporated MIDAS information service. Such statements, findings, conclusions, views and opinions are not necessarily those of IMS Health Incorporated or any of its affiliated or subsidiary entities. COMPETING FINANCIAL INTERESTS The authors declare no competing financial interests.
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