Viral Licensing: Ensuring the Public Interest When Taxpayers Fund Pharmaceutical Research

In recent years, the nation’s drug development and delivery system has loomed in the forefront of pressing policy concerns. This piece suggests a relatively simple pathway that could provide opportunities for progress with aspects of the problem. Through the addition of a few choice provisions in their licensing agreements, research universities could improve consumer choices and access to the drugs developed with their government-funded research. Looking at the entire drug development system, universities play a complex set of roles. They are both the keepers of the academic flame and the stewards of public money. Beyond that, universities also may benefit from the substantial royalty dollars that flow when pharmaceutical companies purchase licenses. Like a well-oiled machine, universities should be able to smoothly and cleanly integrate these roles. Nevertheless, when the entire system is suffering shocks, these roles may come into conflict — particularly when the yearning for royalty green may be in tension with the responsible stewardship of largesse from the public purse. This piece suggests a way in which universities can be faithful to all of the disparate masters, serving as an elegant model of market efficiency and responsible action. With this perspective in mind, this piece suggests using university contracts as pathway for ensuring that innovations developed using federal funds sufficiently benefit those who have funded it. In brief, the paper identifies five potential ways in which contractual requirements could prove valuable and addresses navigating potential roadblocks to the implementation of these types of provisions.