Who’s Afraid of Section 1498? A Case for Government Patent Use in Pandemics and Other National Crises

96 Pages Posted: 3 Sep 2020 Last revised: 12 Feb 2021

See all articles by Christopher Morten

Christopher Morten

New York University School of Law; Yale Law School

Charles Duan

R Street Institute

Date Written: September 1, 2020

Abstract

COVID-19 has created pressing and widespread needs for vaccines, medical treatments, PPE, and other medical technologies, needs that may conflict — indeed, have already begun to conflict — with the exclusive rights conferred by United States patents. The U.S. government has a legal mechanism to overcome this conflict: government use of patented technologies at the cost of government paid compensation under 28 U.S.C. § 1498. But while many have recognized the theoretical possibility of government patent use under that statute, there is today a conventional wisdom that § 1498 is too exceptional, unpredictable, and dramatic for practical use, to the point that it ought to be invoked sparingly or not at all, even in extraordinary circumstances such as a pandemic.

Yet that conventional wisdom is a recent one, and it conflicts with both history and theory. This Article considers the role of § 1498 in the context of national crises and emergencies like COVID-19, a context so far not addressed substantially in the literature on the statute. We find that government patent use is not nearly as exceptional as it is commonly made out to be, and indeed has been not only used but expanded through statutory amendment over the last century. Review of the development and use of the statute during both world wars and the post–September 11 period reveals widespread acceptance of government patent use as a tool for addressing imminent national problems, and it illuminates particular features of government patent use that become especially pertinent in times of crisis. In the United States, government patent use and national emergencies have a close and special relationship; each has shaped the other.

Drawing from the lessons of history and analysis of the statute, we develop a novel framework for comparing § 1498 to other policy tools, including prizes, research grants, and patent buyouts. Under this framework, four features of § 1498 stand out: speed of invocation, flexibility in the scope of its use, post-crisis determination of compensation, and use of an impartial adjudicator.Whenever these four features are advantageous — which will be true in most national emergency situations, as we demonstrate — the U.S.government should strongly consider government patent use over patent buyouts and other policy tools. We show the advantages of these four features in a case study: government patent use to expand supply and access to the COVID-19 treatment remdesivir. Accordingly, and contrary to the conventional view of § 1498, we conclude that government patent should be an ordinary tool of government policy.

Keywords: COVID-19, pandemic, emergency, patents, drugs, medicines, vaccines, pharmaceuticals, pharma, compulsory licensing, 1498, government patent use

Suggested Citation

Morten, Christopher and Duan, Charles, Who’s Afraid of Section 1498? A Case for Government Patent Use in Pandemics and Other National Crises (September 1, 2020). 23 Yale J.L. & Tech. 1 (2020), Available at SSRN: https://ssrn.com/abstract=3685413 or http://dx.doi.org/10.2139/ssrn.3685413

Christopher Morten (Contact Author)

New York University School of Law ( email )

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HOME PAGE: http://https://www.law.nyu.edu/centers/engelberg/team/morten

Yale Law School ( email )

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HOME PAGE: http://https://law.yale.edu/ghjp/who-we-are

Charles Duan

R Street Institute ( email )

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Washington, DC 20009
United States

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