WASHINGTON _ A recently released report concluded that thetransfer of technology from the National Institutes of Health (NIH) tothe private sector has been hampered by significant problems,including the cumbersome process of approving Cooperative Researchand Development Agreements (CRADAs).Ten independent experts spent roughly six months reviewing the NIH'sIntramural Research Program (IRP) after Congress requested athorough evaluation last year. The group submitted its findings to NIHDirector Harold Varmus on April 11 in the form of a 70-page reportand a public meeting to discuss the report is slated for June 2.According to the IRP report, the number of new CRADAs signed eachyear at the NIH has never exceeded 50 (versus 300 in 1993 at the U.S.Department of Energy). On average, it takes between 250 to 350 daysfor an NIH CRADA to be approved (versus an average of less than 60days at the National Institute of Science and Technology).The report charged that review and approval of a CRADA at the NIH is"time-consuming, cumbersome and unnecessarily complex," requiringlayers of scientific, policy, legal, commercial and administrativereview.The Federal Technology Transfer Act of 1986 sought to promotetechnology transfer by authorizing government-operated laboratories,such as the NIH IRP, to enter into CRADAs. CRADAs thus became theformal mechanism by which basic research from the NIH is translatedinto new prophylactic, therapeutic or diagnostic drugs by commercialentities.But the IRP report concluded that NIH procedures for thedissemination of information about CRADA opportunities and theCRADA process do not provide adequate "fair access" to all potentialcommercial partners. "The limited and select distribution of and accessto CRADA opportunities could undermine the industry's interest inCRADAs, impede market competition and erode public support," thereport stated. For example, although the Public Health Servicepublishes an annual Technology Transfer Directory, the volume ispoorly organized and amounts to "150 pages of abstract after abstract."The report also touched on the issue of "reasonable pricing" clauses,which the NIH has inserted into its boilerplate CRADA document. Theclause reads as follows: "[the Department of Health and HumanServices] has a concern that there be a reasonable relationship betweenthe pricing of a licensed product, the public investment in that product,and the health and safety needs of the public. Accordingly, exclusivecommercialization licenses granted for . . . [NIH owned] intellectualproperty rights may require that this relationship be supported byreasonable evidence."Although the clause has never been enforced, the implied threat ofprice controls has been blamed by the drug industry for squelchingtechnology transfer. The IRP report concurs with this view: "Suchclauses discourage technology transfer and the development of newtherapeutic products by imposing pricing restrictions that may limit theability of a company to recover its costs of research and development."The report further argues that CRADAs should not be viewed as amechanism to fund basic research in NIH laboratories: "The return onfederal investment in NIH research should not be judged on the amountof revenue the NIH laboratories generate."The IRP report made several recommendations to Varmus as a meansof reinvigorating the CRADA system, among them:y NIH should create a readily accessible centralized database whichcontains CRADA and other licensing opportunities throughout all theinstitutes.y NIH should develop and publish a practical guide that explains boththe substance and process of CRADAs and develop a mechanism toassure broad dissemination of the guide to the relevant commercialaudiences.y NIH should be more accountable for the timely and efficient reviewand approval of CRADAs.y NIH should promote and use the "Letter of Intent" CRADA,introduced in 1993, which only takes a few weeks to prepare andallows collaborative research work to begin rapidly.y NIH should convene a public meeting with all interested parties andconstituencies from the public and private sectors to specificallyaddress resolution of the "reasonable pricing clause" controversy.The IRP consumes 11.3 percent of the NIH's $11 billion annual budgetand is one of two components of the NIH. The other is the ExtramuralResearch Program, which supports research at universities and otherresearch institutions across the country and receives the lion's share offederal funding. The IRP report recommended that the total IRP budgetbe capped at 11.3 percent of the total NIH budget.The panel of 10 experts who wrote the IRP report include: co-chairsGail Cassell from the University of Alabama at Birmingham and PaulMarks from Memorial Sloan-Kettering Cancer Center in New York;Michael Brown from the University of Texas Southwestern MedicalCenter in Dallas; Gerald Fishbach from Harvard Medical School inBoston; Elizabeth Neufeld from the University of California at LosAngeles School of Medicine; Arthur Rubenstein from the University ofChicago Pritzker School of Medicine; Kenneth Shine from the NationalAcademy of Sciences' Institute of Medicine in Washington; MaxineSinger (ex officio member) from the Carnegie Institute in Washington;P. Roy Vagelos from Merck & Co. in Whitehouse Station, N.J.; andJames Wyche from Brown University in Providence, R.I. n
-- Lisa Piercey Washington Editor
(c) 1997 American Health Consultants. All rights reserved.