LIC HEALTH SERVICE ACT—
AMENDMENT

The Senate resumed consideration of

to amend the Public

£44. naniat tn aamhating

the bill (S. 596)

CONGRESSIONAL RECORD — SENATE

heart disease, cancer, and stroke, and
other major diseases.

Mr. YARBOROUGH. Mr. Presi-
dent——

The PRESIDING OFFICER. Who
yields time?

Mr. MANSFIELD. Mr. President, I
assume that the Senator from Texas
would be in charge of the time until the
Senator from Louisiana (Mr. Lone] ar-
rived.

Mr. YARBOROUGH. I yield myself
10 minutes.

The ‘PRESIDING OFFICER. The
Senator from Texas is recognized for 10
minutes.

Mr. YARBOROUGH. Mr. President,
the Senate has under consideration this
morning a piece of major legislation, 5.
596, a bill to combat heart disease, can-
cer, and stroke—major diseases. These
are the major killers of our population.
The measure is designed to avert death
and disability from these diseases. They
being major diseases, we should have
-major means to combat them.

The incidence of these diseases was de-
veloped in the hearings on this measure
before the Subcommittee on Public
Health of the Committee on Labor and
Public Welfare of which I am a member.
The statistics show that the three dis-
eases together cause more than half of
all the deaths in the United States in 1

year. :

In 1963, 707,830 persons died of, and
from 25 to 30 million more suffered from,
heart disease. The direct medical cost
of heart disease in 1962 alone was $2.6
pillion. The loss of income from heart
disease that year amounted to $19.8 bil-
lion, for a total cost for this one disease
in 1962, of $22.4 billion.

Also in 1963, 278,562 persons died of
caygeer. Another 830,000 were under
treatment. It is estimated that 48 mil-
lion people now living will have cancer.
The total annual cost of cancer is $3
billion.

In the same year, 1963, 201,166 per-
sons died of strokes. At least 2 million
more now alive had strokes, and many
of them are paralyzed. The economic
cost of strokes is more than $1.1 billion
a year. .

These diseases are great killers and
cripplers.~ They sap our economy of
$31.5 billion each year. They cause un-
told hardship, anguish, and suffering.
But they give ground to organized at-
tack, and this present bill is an organized
attack upon them. We are dealing, in
the amendment offered by the junior
Senator from Louisiana, with the ques~-
tion of whether we will make the attack
now or whether we will withhold the
attack until some private monopoly can
zero in with their patents, some 3 to 5
years after a discovery is made—which
is possible if we give away these patents
that have been bought and paid for by
the Government. The private recipient
of 2 US. patent, as we have seen under
our present system, can protect his pat-
ent against possible other users and de-
lay the product of research from prompt-
ly reaching the people whom it is in-
tended to serve.

We are dealing with more than the
enestion of whether the public should

— June 28, 1965

get the benefit of its medical discoveries
paid for with public moneys or whether
private manufacturers should get the
benefit. We are dealing with the ques-
tion of whether this relief from human
suffering and anguish will be granted
soon after discoveries are made or
whether that relief will be delayed for
years while private monopolists secure
all their patent rights.

Since I have been in the Senate, two
who were near and dear to me have died
of cancer after prolonged jlnesses.. If
any Senator has had anyone die of can-
cer within recent years and observed
that person after they have reached the
stage when the pain is so intense that
neither morphine nor any other pain
killer can relieve it, and nothing but
death can relieve the pain, he would
think a long t'me before he would vote
to withdraw the product from the peo-
ple until some private monopoly, which
has used the money of the people to do
the research, had developed the patent,
and zeroed in all the patent rights, to
reap an additional profit, on top of thai.
granted with the Government research
moneys.

No plainer issue has been before the

Senate for some years. Each Senator
must stop and consider whether he will
vote to give the benefit of Government-
paid-for medical discoveries to the pub-
lic now or make the public wait for 3 to
5 years, so that the private monopoly may
get exclusive patents lined up on these
Government-financed discovery. If a
Senator stops and considers the question,
he will think for a long time before he
votes against the amendment offered by
the junior Senator from Louisiana.
- Mr. President, we have had numerous
instances in history in which the public
use of medicines has. been delayed, after
discovery, until some private interest
could get its patents lined up.

I shall read from page 21 of a book by
Richard Harris, entitled “The Real
Voice.” The book is an account of Sena-
tor Estes Kefauver’s investigation into
the drug industry and the battle which
ensued.

Lread from page 21 as follows:

In looking into the development of the
antibiotics, the staff started at the begin-
ning—with Sir Alexander Fleming's discovery
of penicillin, in 1929. Fleming realized that
penicillin had a potent, if obscure, effect
on certain bacteria, but it wasn’t until 1941
that other British researchers proved that
the drug was highly efficacious in treating
septic wounds. That year, the U.S. Govern~
ment became eager to determine whether it
could be produced in quantity, and two
British researchers were brought to this
country, under the auspices of the Office
of Scientific Research and Development,
to try to get private pharmaceutical
houses interested in working on the
project. They had almost no luck. A few
weeks after the attack on Pearl Harbor, Dr.
Vannevar Bush, Director of the OSRD,
personally brought 4 number of drug firms
into the picture. Almost a year and a half
later, in the spring of 1943, they had accom-
plished little in the way of quantity pro-
duction, and on April 27 Dr. Bush wrote a
letter to Elihu Root, Jr., then a consultant.
to the Army Air Forces: “Now, the pharma-
ceutical compantes have cooperated in this
affair after a fashion. They have not made
their experimental results and their develop-
June 28, 1965

@:: of manufacturing processes generally

ilable, however. * * * This is the problem.
z obviously needs some very careful han-
dling.” As it turned out the problem was
that most firms were too busy trying to
corner patents on various processes in the
production of penicillin to produce much
of it, and the Government began pressing
them to work together. It was slow going.
On January 19, 1944, Dr. Albert L. Elder,
the coordinator of a special penicillin pro-
gram run by the War Production Board, sent
a memorandum to Fred J. Stock, head of the
Drugs and Cosmetics Section of the WPB,
complaining about the refusal of the drug
firms to exchange information, and added,
“The value of penicillin in saving the lives
of wounded. soldiers has been so thorough-
ly demonstrated that I cannot with a clear
conscience assume the responsibility for co-
ordinating this program any longer while at
the same time being handicapped by being
unable to make available information which
would result in the output of more penicil-
lin and thereby save the lives of our soldiers.”

Not even to save the lives of those men
who were fighting for the survival of
democracy would those private seekers
after patents make the discovery of
penicillin available so that it could be
produced.

Mr. President, I ask unanimous con-
sent that there be printed at this point
in the Recorp the paragraphs that I
have read, in addition to the remaining
discussion of this question which appears
on pages 22 and 23, down through the
first 2 lines of page 23, in the book by
Richard Harris.

There being no objection, the excerpts
re ordered to be printed in the Recorp,
follows:

In looking into the development of the
antibiotics, the staff started at the begin-
ning-—with Sir Alexander Fleming’s discovery
of penicillin, in 1929. Fleming realized that
penicillin had a potent, if obscure, effect on
certain bacteria, but it wasn’t until 1941 that
other British researchers proved that the
drug was highly efficacious in treating septic
wounds. That year, the U.S. Government
became eager to determine whether it could
be produced in quantity, and two British
researchers were brought to this country,
under the auspices of the Office of Scientific
Research and Development, to try to get
private pharmaceutical houses interested in
working on the project. They had almost
no luck. A few weeks after the attack on
Pearl Harbor, Dr. Vannevar Bush, Director of
the OSRD, personally brought a number of
drug firms into the picture. Almost a year
and a half later, in the spring of 1943, they
had accomplished little in the way of quan-
tity production, and on April 27 Dr. Bush
wrote a letter to Elihu Root, Jr., then a con-
sultant to the Army Air Forces: “Now, the
pharmaceutical companies have cooperated in
this affair after 2 fashion. They have not
made their experimental results and their
development of manufacturing processes
generally availabie, however. * * * This is
the problem. It obviously needs some very
careful handling.” As it turned out, the
problem was that most firms were too busy
trying to corner patents on various processes
in the production of penicillin to produce
much of it, and the Government began press-
ing them to work together. It was slow go-
ing. On January 19, 1944, Dr. Albert L.
Elder, the coordinator of a special penicillin

‘ogram run by the War Production Board,

}: @ memorandum to Fred J. Stock, head
the Drugs and Cosmetics Section of the
WPS, complaining about the refusal of the
drug firms to exchange information, and
added, “The value of penicillin in saving the

.

CONGRESSIONRL RECORD — SENATE

thoroughly demonstrated that I cannot with
a clear conscience assume the responsibility
for coordinating this program any longer
while at the same time being handicapped by
being unable to make available information
which would result in the output of more
penicillin and thereby save the lives of our
soldiers.”

By then, an obscure outpost of a Govern-
ment agency was far ahead® of the drug
firms, the scientists of a Department of
Agriculture laboratory in Peoria, Ill, were
rapidly evolving a method of large-scale pro-
duction. Soon, the Department filed its own
patent applications, and they were granted,
whereupon, under its regulations, all of its
patents were made available to any producer
without charge. By the time the war ended,
the production of penicillin had reached
some 7 billion units—an average shot may
be 600,000 units—and the drug had saved
the lives of thousands of servicemen. After
the war, more and more drug firms began
making and selling the drug in a stiffly com-
petitive race; within 8 years the price had
fallen from $200 per million units to 60 cents
per million units.

Mr. YARBOROUGH. Mr. President,
it was the research branch of the De-
partment of Agriculture which discovered
a faster method of producing penicillin,
and enabled the mass production of pen-
ieillin for the use of the Armed -Forces.
It was not the pharmaceutical companies
which were sitting back and waiting un-
til they could zero in on the patents.

In the case of a public patent, the
people develop the product with their
money. It is made available to all the
public and all manufacturers. The Gov-
ernment does not go into private business

‘of manufacturing the drug product. It

will give the rights to manufacture to all
those whom it feels can manufacture it
and get it on the market at the lowest
cost to the public. This is the true free
enterprise system. It stimulates -com-
petition between the different drug man-
ufacturers to get the product on the
market in the most usable form, and
results in the speedier usage of new
drug discoveries.

While price is a great factor, and the
saving of money by the patient is a
great factor in the case of new drugs,
time is an even greater factor. In the
case of new cancer discoveries, many
lives might be lost by the delay in an-
nouncing a new discovery. The obtain-
ing of monopolistic patent rights is al-
ways a cause of long delay.

Mr. President, because the Govern-
ment kept the patent rights on penicillin,
it was made available to the public at a
vastly lower cost per million units of
pencillin. The price of penicillin fell
from $200 for 600,000 units of pencillin
to 60 cents per 600,000 units in 8 years,
under the competitive private enterprise
system. The Government made the
benefits of the penicillin discoveries at a
small agricultural research station at
Peoria, Ill, available to all penicillin
manufacturers and that caused the great
saving in price.

If the Government retains the benefit
of its research, it gives that knowledge
free to all drug manufacturers, and
strengthens the private enterprise sys-
tem, as well as getting the drugs on the

market without undue delay.

if, we were to give the companies $650

a ee Ta EER.

ow

14397

bill, with research paid for on a cost-
plus, fixed-percentage basis, if they find
nothing, they have made their profit,
they are paid the money.

If they find something, these drug
manufacturers expect that we should al~
low them to patent the product, pull it
off the market and then sell it years
later at an unconscionable price.

There was printed in the Recorp a few
days ago, and I ask unanimous consent
to have reprinted at this point in the
Recorp an article from the Washington
Post of May 19, 1965, which outlined how
the price of one unit of medicines that
were discovered with Government
moneys partly in a university laboratory
and partly with private research, was
overcharged 40 times, until the Govern-
ment stepped in and reclaimed for the
Government its own discoveries in the
field of prevention of mental retardation.

There being no objection, the article
was ordered to be printed in the Recorp,
as follows:

[From the Washington (D.C.) Post, May 19,
1965]

How Bar To RETARDATION WAS OPENED TO THE
Many—tTest Cost Cur TO ONE-FORTIETEH
(By Morton Mintz)

This is a story of why a test used to pre-
vent a severe form of mental retardation
costs 1.2 cents per baby instead of 40 times
as much.

It did cost’ 50 cents per baby for a time.
Had that price prevailed, says the U.S. Chil-
dren's Bureau, certain States would not have
begun mass testing programs and many chil-
dren who now will be normal would have
been. irreversibly retarded.

Exclusive rights were originally assigned
to a private firm that charged $262 for a test
kit that the inventor manufactured for 36.
The Government has: now obtained uncon-
tested rights in the pending patent applica-
tion and any qualified organization can make
the kits without paying royalties.

The story was pieced together from inter-
views and from Government files obtained
by Senator Russet. B. Lone, Democrat, of
Louisiana, as chairman of the Senate Small
Business Committee’s Monopoly Subcommit-
tee. Lone discussed the story in the Senate
Monday.

Since 1959, Lone has been working to give
the Government property rights in inven-
tions developed with the help of the $15 bil-
lion a year that the Government spends with
research and development contractors. The
mental retardation test was developed largely

with Government funds,

STORY'S LEADING FIGURE

The leading figure in the story is the in-
ventor of the test, Dr. Robert Guthrie, of
Buffalo, a brilliant scientist and himself the
parent of a retarded child.

“T had always assumed,” he said, “that the
price would be reasonable.” But he termed
himself naive about such matters.

The simple, reliable test he developed de-
tects the metabolic disorder phenylketonuria,
usually called PKU.

A few drops of blood are taken from the
heel of an infant in the first few days after
birth. If the disorder is found, a special diet
will prevent retardation.

The incidence of PKU had been believed to
be 1 in 20,000 to 40,000 births, but a masse
screening of 400,000 infants in 1962-63 estab-
lished a rate of at least 1 in 10,000. That
indicates a natjonwide potential of about 400
PKU-retarded infants a year, including
roughly 3 in the Distric’, 7 ir. Maryland, and

dan TP iid
14398 :

MANDATORY IN MARYLAND

The test is now being performed regularly
m 90 to 100 percent of the hospitals with
maternity services in 14 States and in a total
of 2,600 nospitals in all States except Alaska.
Some States. including Maryland, have made
the test manaatucy for hospital births.

In Massachusetts, the test has detected 33
PKU cases. Dr. Guthrie said this was done
with mass screening that cost State taxpayers
about as much as lifetime custodial care for
one person in a public institution.

Dr. Guthrie, a 48-year-old microbiologist
and physician, attributed his special interest
in developing the test to the PEU retarda-
tion of a relative in Minneapolis. A member
of the pediatrics department of the School
of Medicine of the State University of New
York, Dr. Guthrie in 1958 received his first
grantse—$25,000 each, for 5. years—from the
National Association for Retarded Children
and the Association for Aid for Crippled
Children. Later, he received a total of
$75,672 from three other nongovernment
sources.

But starting in 1959, the Public Health
Service gave $251,700. Chiefly for the sub-
sequent mass screening, the U.S. Children’s
Bureau granted $492,000.

FIRM IS NOMINATED

Long before the Bureau got into the pic-
ture, but after the test was perfected, Dr.
Guthrie and the NARC agreed that a swift
way to bring the test. into the widest possible
‘use would be to enlist a pharmaceutical firm
with a worldwide organization.

The Ames Co., a subsidiary of Miles Labo.
ratories of Elkhart, Ind., was nominated by
Dr. Guthrie because it had been marketing
@ urine test for PKU. That test, however,
is not well suited for mass use.

A lawyer friend of Dr. Guthrie, Raymond

. Kuhns of New York City, who was donat-

g his legal services, advised that a patent

on the invention be sought.

cerned with the possibility that the plan

for mass use of the test could be jeopardized

by another patent only with costly, pro-
tracted litigation.

Almost a year had gone by since Dr.
Guthrie had published articles about the
test. This meant that unless a patent ap-
plication were filed quickly, Dr. Guthrie's
claim automatically would be denied.

Kuhns said that Miles Laboratories, which
had accepted an invitation to participate,
agreed with him in emphasizing to Dr.
Guthrie that any proposed patent agreement
would have to be approved by the Public
Health Service.

BARS ROYALTIES FOR SELF

This is the kind of thing—questionnaires,
reatape—-that Dr. Guthrie scorns. His sci-
entific work preoccupies him. Not until
almost a year after the PHS began pressing
him with letters and phone calls did he get
around to filing the required reports.

The patent application and licensing
agreement, which meanwhile had been
drawn up by an associate of Kuhns on a
nonprofit basis, put title in the name of
Dr. Guthrie, but at his request barred him
from getting a cent in royalties.

Instead, Miles, which was made the ex-
elusive licensee, agreed to pay 5 percent of
the net proceeds of sales to the NARC. Ujlti-
mately, that association got $1,100.

During the discussions, no one thought to
ask what price Miles intended to charge.

In 1962, the patent application was filed
and the licensing agreement signed. At
about that time, the Children’s Bureau an-
nounced its plans to screen the 400,000 in-

A great many test kits had to be

ants.
roduced, and quickly.

TURNS PRODUCTION MAN

Miles was unable to gear up fast enough
for this job because of what Vice President

ae a te

He was con~-

CONGRESSIONAL RECORD — SENATE

tion problems. So Dr. Guthrie, who was
not, as Kuhns put it, “in any remote sense
a businessman,” became a production man,

With bureau funds, he rented a house,
and in it, in a year’s time, turned out 10,000
kits, enough for a million tests. Packaging
was done by retarded young adults.

Ames, the Miles subsidiary, “took what
we had done and repackaged it,” Dr. Guthrie
said. “The big price then particularly made
no sense.”

The “big price” as $262 for a 500-test kit
that the scientist produced for $6. He had
not known what the price would be until
June 1968, when he visited Miles. “I was
horrified,” he said.

He pointed out that since the Government
made his invention freely available, com-
mercial laboratories—including Miles-—have
offered the kit for a fraction of its original
price.

The Miles official, Orr, suggested that one
reason for the $262 price was the need to use
only the highest quality sterile materials.
However, he acknowledged that he did not
intend to imply that his firm’s test kit was
superior in that regard to Dr. Guthrie’s. He
did, however, fault the scientist's definition
of costs.

NULLIFICATION BEGINS

In the Department of Health, Education,
and Welfare, a drive began to nullify the
agreement with Miles. One who urged this
was Herschel F. Clesner, inventions coordi-
nator for the PHS.

On November 5, 1963, the chief of the
Children’s Bureau, Katherine B. Oettinger,
wrote Ciesner “that the granting of exclusive
commercial rights to Miles Laboratories
would prevent Massachusetts and some of
the larger States now contemplating setting
up this screening from carrying out their
plans.”

“None of these States could afford to in-
stitute a program if they had to purchase
the kits commercially at the contemplated
($262) price, or if they had to pay royalties
on the materials they would manufacture
themselves,” she sald.

A year ago, the Acting Surgeon General
of the PHS, Dr. David E. Price, officially de-
terthined that the contract should be can-
celed because “the best interests of the pub-
lic will not be served by * * * an exclusive
license. * * * Insofar as the invention may
be patentable, the equitable ownership of
all rights, both domestic and foreign, shall
be in the United States.”

Mr. YARBOROUGH. Mr. President,
this product to determine whether 2

' child was suffering from mental] retarda-

tion, was discovered with the use of
public moneys. Later, a private company
charged $262 for one unit of a test in
testing infants to see if they had an
ailment that would cause mental retar-
dation.

Since the Attorney General of the
United States has reclaimed the product,
the cost for a kit is now $6 for the test
kit to be used. The cost of $262 for a kit
to test to discover whether newborn
babies had an ailment that would cause
mental retardation all their lives was
cut to $6 a kit, and the cost of the test
per baby was cut from 50 cents a baby
to 12 cents a baby. The overcharge
had been 40 times the real cost.

Mr. HILL. Mr. President, will the
Senator yield?

Mr. YARBOROUGH. I shall yield on
the Senator’s own time.

Mr. HILL. Mr. President, the state-
ment of the Senator should be accurate.
It was the U.S. Public Health Service

wrhinh otannad tha nenfitooring

~F

June 28, 1965

Mr. YARBOROUGH. The Senator is
correct. It was a part of the U.S. Gov-
ernment which stopped the profiteering.
The private companies were claiming the
discoveries as private patents and they
had the assistance of a university. They
were charging $262 for a unit of medi-
cine with which to test babies to prevent
severe mental retardation, when $6 was
the final cost per unit established. The
private drug company was more inter-
ested in a 40-fold profit than in whether
mental retardation was to be prevented.

When we got that test back in the
public domain to be used for the public,
who had paid for the discovery, the cost
was reduced to $6 per unit, or 1.2 cents
per baby. The question at issue is
whether we should allow a private mo-
nopoly to charge $262 for a test kit to
be used with babies, or allow the people
to charge whatever they want to charge
with their own discoveries.

Any person or company can charge
whatever they like if they discover some-
thing with their own money. But the
Long amendment question does not deai
with private moneys. This Long amend-
ment deals with public funds, with public
moneys taken from the pockets of all
the taxpayers in the United States.

I ask every Senator to search his con-
sclence and see whether he can vote to
give away such patent rights when hu-
man pain is involved. This is different
from the NASA. This is very different
from the issue which arose in the case
of NASA, when the NASA. directors
wanted to give the patents away. We
vote $6 billion a year to space explora~
tion, and we hope they make great dis-
coveries. The NASA authorities worked
to keep the authority to give away patent
rights to those amply paid to do Govern-
ment research on space problems.

By throwing their weight in and fight-
ing for the giveaway the NASA authori-
ties were able to beat the opposition
down and to defeat those defending the
public interest. . But this time we are
dealing with human pain; we are dealing
with ill people on earth, not researches
in space. When a means of relief from
human pain and illness is discovered as
a result of the expenditure of public
money, are we going to make it available
for the average person to buy or are we
going to permit a monopoly to. delay
the general use for 3 or 5 years, and then
charge exorbitant prices? That is the
question involved.

Mr. LONG of Louisiana. Mr. Presi-
dent, will the Senator yield?

Mr. YARBOROUGH. I yield.

Mr. LONG of Louisiana. The Senator
is absolutely correct. We want the Pub-
lic Health Service and the Department of
Health, Education, and Welfare and the
National Institutes of Health to protect
the public interest, just the same as these
fine people did in this case.

I have some other examples to give,
and I will give them before the debate
is over. The National Institutes of
Health is honeycombed with people who
want to be able to patent and sell certain
products to private companies so the
monopolies can sell them for 10 to 30
timoe what. thev wild he otherwise sold.
June 28, 1965

The PRESIDING OFFICER. The
@:: of the Senator has expired.

Mr. LONG of Louisiana, I yield the
Senator 2 additional minutes.

Mr. YARBOROUGH. This has been a
subject for considerable discussion in
university circles and the role of uni-
versities in this medical research. The
governing officials of our universities
should search their consciences. Do they
want to protect the people’s rights, or,
in return for an endowed chair, do they
think it is worth giving away the public
interest? Is an endownment more to be
treasured that the protection of the peo-
ple’s rights? Do the humanities teach
that we surrender monopoly patents on
discoveries to alleviate human pain, dis-
coveries made with public moneys? The
university community of America should
ask itself some soul-searching questions
on its position concerning proper use of
the proceeds of these public funds.

Mr. LONG of Louisiana. I have
checked this question over the weekend.
The best information I can get is that
not one of the associations. represent-
ing universities has taken a position on
this issue. From what I understand,
two-thirds of the universities have not
taken a position, and of the one-third
that have taken a position, the great ma-
jority of them recognize that discoveries
made as a result of using public funds
in the area of public health should be
placed in the public domain.

Mr. President, I wish to state my

rong support for the broad purposes of

legislation. One of the great prob-
Jems facing the health professions is
how best to make use of all the knowl-
edge which is being discovered every year
through research. How do we get the
message out to the doctors in small
towns and in rural areas? Through this
bill we will construct regional medical
complexes consisting of medical schools
and hospitals in association with re-
search centers and treatment stations
working on heart disease, cancer and
stroke. ‘These dread diseases are our
big killers, and it is vital to the improved
health of our citizenry that we make use
of the new knowledge which is constant-
ly being discovered.

This being the purpose of the legisla-
tion, it is important that the informa-
tion discovered through funds author-
ized by the bill be made freely and fully
available. The amendment offered by
the distinguished Senator from Louisi-
ana [{Mr. Lone] provides just this. It
says very simply that-~-

No part of any appropriated funds may be
expended pursuant to authorization given
by this act for any scientific or technologi-
cal research of developmental activity un-
less such expenditure is conditioned upon
provisions effective to insure that all devel-
opments resulting from that activity will be
made freely available to the general public:

In the difficult area where both pub-
lic and private funds have been spent
on the research leading to a discovery,

e amendment provides a limited exclu~-

ve licensing arrangement for no longer

~ than 3 years if the private company is
justified in receiving such an exclusive
right upon equitable considerations re-

a eae aa RR ea

CONGRESSIONAL RECORD — SENATE

and, if such an arrangement will affirma-
tively and substantially promote the
utilization of the development and the
interests of public health or welfare
within the United States.

Mr. President, this amendment is fair
to the interests or private contractors.
It protects the public interest. Why is
it being so stoutly resisted? The answer,
in four words, is: “The manufacturers
of drugs.”

This is not the first time Congress has
had to deal with the fantastic lobbying
strength which this segment of the man-
ufacturing industry can muster. We still
remember the gallant fight which our
late, beloved colleague from Tennessee,
Senator Kefauver, led to effectively mod-
erate some of the excesses of this seg-
ment of the manufacturing industry.

Figures turned up by Senator Kefauver
showed that the drug manufacturing in-
dustry has shown the highest profit rate
on investment of any industry in the
land. ‘The unbelievable profits of the
big drug manufacturing companies are
often the result of Government imposed
restrictions on competition and indirect
Government subsidies. But to the drug
manufacturing companies this is not
enough. They eagerly importune the
Federal Government to finance much of
their costs of research and develop-
ment—but they demand that they be en-
titled to preempt for themselves the
fruits of the research financed by the
citizens of our country.

At the present time Federal funds are
used in this industry to finance research
and development in three major ways.
Although it is virtually impossible to
estimate the value of these Federal con-
tributions, it probably runs to hundreds
of thousands of dollars a year. In the
first place, research conducted by gov-
ernmental agencies, such as the National
Institute of Health, occasionally yield
new drug products. In 1961, for example,
NIH reported the development of a new
and potent synthetic painkilling drug,
available under the trade name Prinadol.
This new analygesic has a more power-
ful painkilling action than morphine;
yet it is free from many of the un-
desirable side effects caused by morphine.
Products such as this, in turn, are made
available for commercial exploitation,
usually on an exclusive basis, to a major
drug company. This is necessary when
new uses are found for old drugs on
which the patent has expired, when sales
are to be made to the Government, or
evidence of safety and utility must be
provided.

Finally, Federal funds support similar
testing carried on by private hospitals as
well as by State, county, and municipal
hospitals. This money, which is in the

form of grants from NIH, helps to defray

for individual drug companies the ex-
pense of clinical testing carried on in
such hospitals.

In addition to forthright financial aid,
the Federal Government has provided
a number of important protections and
benefits to the U.S. drug manufacturing
industry. The Federal Government
gives exceptionally favorable tax treat-
ment for expenditures on research and

wt

wee Be bee

ft

14399

either a business expense or can be
capitalized and amortized over a period
of years. Moreover, this type of treat-
ment can be extended to many types of
expenditures which are only distantly
related to research, as usually conceived.

Further, most people are not aware
of the great service rendered by the Fed-
eral Government to the big manufac-
turing drug companies with respect to
the new drug applications which must
be filed and approved by the Food and
Drug Administration before any drug
can be put on the market. These ap-
plications must be supported by exten-
sive clinical testing which costs from
$50,000 to $100,000 and up. Under the
FDA’s regulations, which are not re-
quired by law, the smaller drug pro-
ducers who wish to sell a drug already
on the market must duplicate the clini-
cal testing which has already been ap-
proved by the FDA. According to small
drug producers, the effect of this re-
quirement is to prevent them from com-
peting with their larger rivals on prod-
ucts which are not patentable or on
which the patent has expired. :

Of course, the most important pro-
tection extended to the industry by the
Federal Government is the patent. It is
often forgotten that the Constitution
makes the granting of patents permis-
sive, not mandatory. And on drugs this
country has seen fit to grant the most
extreme form of patent protection pos-
sible. With the exception of Belgium,
it is the only developed, industrialized
country which grants both process and
product patents on drugs, does not pro-~
vide for compulsory licensing, and im-
poses no price controls. Other coun-
tries, including many which have been
noted for their development of new phar-
maceutical products—for example, Ger-
many, France, and Switzerland—have
sought to provide some protection to the
consumer, This attitude stems from
the strong moral conviction that no one
should have the right to withhold from
the sick and ailing a product which spells
the difference between sickness. and
health, life and death. But while grant-
ing to the drug manufacturing industry
vast sums of money and a myriad of pro-
tections, the U.S. Government has ex-
tended no comparable protection to the
American public. The drug manufac-
turing industry is being allowed to make
tremendous profits at the expense of the
taxpayers.

Spokesmen for our drug industry
would have you believe that they are the
only people who have ever discovered
any drugs. The facts are otherwise.

Countries like Germany, France, and
Switzerland, which grant patents only’
on processes and not on drug products,
have been in the forefront in drug dis-
coveries. Even in the past 20 years,
many of the important discoveries have
emanated from abroad. Oral antidia-
betic drugs, for example, are the German
development, although some Americans
later developed molecular modifications
of the original German compounds.
Tolbutamide, sold by Upjohn under
the trade name Orinase, was devel-
oped by Hoechst Co., of Germany, and
is the largest selling or71] antidiabetic

whamere fen State nse becs Tins ned ban eet lin
14400 ,

@: used in our. mental hospitals are a
rench development. Thorazine and
Compazine, the biggest selling potent
tranquilizers to mental institutions in
this country, are exclusively licensed to
Smith, Kline & French by the French
company which originated the com-
pound. An additional example is the
development of drugs designed to alle-
viate motion sickness. Searle, a U.S.
company, developed Dramamine and has
a patent monopoly. On the other hand,
the competing product sold only by
Pfizer is a Belgian development. The
Belgian firm granted an exclusive license

to Pfizer for sales in the United States. ~-

In his fascinating, best-selling book on
the Kefauver drug investigation, ‘““The
Real Voice,” Richard Harris notes that
at one of the hearings, a noted professor
of pharmacology testified that “far from
leading in drug progress, it appears that
our industry has usually followed and
often after a clear lag.” Harris goes on
to note that the doctor did “give the
United States credit for the discovery of
cortisone and other cortical steroids,
and for anticoagulants, hydrazides, an-
terior pituitary hormones, antithyroids,
and oral diuretics, but he went on to
say that ‘most of the progress—in drug
research—has come from-European and
British researchers, both industrial and
independent.’ Foreign researchers, he
added, had discovered the antihista-
mines, synthetic morphine substitutes,
new antimalarials, synthetic estrogen,

ost all of the tranquilizers, oral anti-
iabetics, and penicillin, the ancestor of
all the other antibiotics. The purpose
of much of the work done by American
drug firms, Dr. Meyers asserted, was
‘partly to exploit and market’ these for-
eign products but ‘mostly to modify the
original drug just. enough to get a
patentable derivative’.”

The American public is paying for
this vast research effort. And the Amer-
ican people should not be deprived of the
resulting benefits. New drugs discovered
with the aid of public money have been
withheld from the public entirely, or were
offered only at outrageous prices. I am
not contending that the various forms of
Federal aid be curtailed. I am for this
Federal research. Iam, however, insist-
ing that those who pay for the research
should be its beneficiaries. It is most
unbecoming for the Government of the
United States to accede as a matter of
policy to any private interest, group, or
industry. The very belligerence of the
drug manufacturing industry that it will
conduct research financed by the Federal
Government only on its own terms is the
strongest possible argument that can be
advanced in support of Senator Lone’s
amendment.

The PRESIDING OFFICER. The
time of the Senator has expired.

Mr. LONG of Louisiana. I yield 1 ad-
ditional. minute to the Senator from
Texas.

Mr. YARBOROUGH. I ask unani-

ous consent to have 3 additional min-

‘Mr. LONG of Louisiana. I yield 3 ad-
ditional minutes to the Senator from
Texas.

- have now reversed themselves.

CONGRESSIONAL RECORD — SENATE

Mr, YARBOROUGH. We heard the
statement made last Friday that the floor
of the Senate is no place to legislate. If
the floor of the U.S. Senate is no place to
legislate, why in God’s name do we have
it? The criticism we hear around the
country is that decisions are made in
smoke-filled rooms or in the little groups
of subcommittees, and that the Senate
has lost its savor, and fails to legislate.
Let us legislate on the floor of the Sen-
ate, let us take this bill out into the light
of day, and let the American people see
how we legislate. It is time we legislated
on the floor of the Senate if the fruits
of $650 million of the people’s research
money is going to be given away to pri-
vate monopolies which are already paid
in full, with profit, for the research done.

The PRESIDING OFFICER. The
time of the Senator has expired.

Mr. LONG of Louisiana. Mr. Presi-
dent, I yield such time as is necessary
for me to propound a question and for
the Senator to reply.

The Senator from Texas has discussed
some of the drugs developed in Europe.
The Senator is aware, is he not, that
when some of the products are made
available to American drug companies
through a license, the American com~
pany receives much greater protection
than the European company, enabling
the American company to charge a high-
er price than is permitted in the Euro-
pean countries?

Mr: YARBOROUGH. Exactly.

The purpose of the Long amendment
is to permit the results of the research
made with the people’s money to be made
available to the people. By adoption of
the Long-amendment the discoveries will
be made available to the people much
faster than if they are given to private
monopolies.

‘I regret that there is no single repre-
sentative of the other side of the aisle
on the floor today. Maybe they do not
want to listen, and then vote against
the Long amendment. There was a time
when Republicans like Borah, Norris,
MeNary, and La Follette stood up alone
fighting to protect the public interest
when the minority which then was on
our side of the aisle was not fighting to
protect the public interest. I hope,
whichever way the vote goes, that the
majority of Senators on this side of the
aisle will not vote to give away the public
interest. I hope the great majority of
the Democrats will cast their votes for
the Long amendment.

It is not a restrictive amendment on
research, and will not delay research.

This amendment has been watered
down to meet the approval of the de-
partment concerned. It was amended
after long discussion, to meet the ap-
proval of the Department of Health, Ed-
ucation, and Welfare, and did meet it:
approval. .

What secret forces are applied to them
to make the American Cancer Society
and the American Heart Institute change
their position, because they have been
doing exactly that when they agreed to
the changed Long amendment. They
Why?

o

June 28, 1965

Mr. President, I ask unanimous con-
sent to have printed in the Recorp the
wording of the Long amendment.

There being no objection, the amend-
ment was ordered to be printed in the
Recorp, as follows:

On page 12, line 4, immediately after
“Sec. 906.”, insert the subsection designation
“(a)”.

On page 12, between lines 11 and 12, insert
the following:

“(b) (1) No part of any appropriated funds
may be expended pursuant to authorization
given by this title for any scientific or tech-

* nological research or developmental activity

unless such expenditure is conditioned upon
provisions effective to insure that ali devel-
opments resulting from that activity will be
made freely available to the general public.
The Surgeon General shall include in each
grant or contract made or entered into under
such authorization for any such activity pro-
visions under which the United States will
acquire exclusive right in and to any such
development. Nothing contained in this
paragraph shall be construed to deprive the
owner of any background patent relating to
any such activity, without his consent, of
any right which that owner may have under
that patent. .

“(2) The Surgeon General may enter into
an agreement with any charitable public
health organization for the equitable disposi-
tion (for such period not exceeding three
years as the Surgeon General may prescribe)
of proprietary interests in any development
which has been made through research. or
developmental activity for which such or-

tion has made substantial financial
contribution if the Surgeon Genera] deter-
mines with the concurrence of the Attorney
General, after according to all interested
parties an. opportunity for public hearing
upon such proposed agreement, that such
agreement will affirmatively advance the in-
terests of public health. Each such agree-
ment shall be subject to the provisions of
paragraph (4) of this subsection.

“(3) Any grantee or contractor who has
made any development in the performance
of any obligation incurred under any grant
or contract made or entered into subject to
the provisions of this subsection may apply
to the Surgeon General for the transfer to
him of exclusive right (except against the
United States or any Federal, State, or local
governmental entity) to exploit such devel-
opment for commercial. purposes for such
period (not exceeding three years) as the
Surgeon General may prescribe. Before any
such transfer is made, the Surgeon General
shall comply with the requirements herein-
after set forth in this paragraph. The
Surgeon General shall cause to be published
in the Federal Register notice of the making
of such application and a full and complete
statement concerning the circumstances
under which that development was mace
and the justification asserted by the appli-
cant for such transfer. At such time (not
earlier than 30 days after such publication)
as the Surgeon General shall prescribe in
such notice, opportunity for a hearing on
the record upon such application shall be
accorded under such regulations as the Sur-
geon General shall prescribe to each person
who would be affected thereby, including
any State or local government and any. rep-
resentative of an organization or segment of
the public legitimately concerned therewith.
Upon the basis of evidence received in such
hearing, or if no such hearing has been re-
quested upon the basis of such evidence as
the Surgeon General shall obtain by full
and complete investigation and preserve aa &
public record for not less than five years,
the Surgeon General may transfer the pro-
prietary interest for wnich application was
June 28, 1965

@-: or any lesser proprietary interest to
- e applicant if the Surgeon General deter-
mines, with the concurrence of the Attorney
General, that the making of such transfer—

“(A) is clearly justified upon equitable
considerations by the contribution made or
to. be made by the applicant to such develop-
ment apart from the financial contribution
made or to be made thereto by the United
States;

“(B) will affirmatively. and substantially
promote the utilization of such development
and the interests of public health or welfare
within the United States; and

“(C) will not result in or contribute to
any material restraint of the interstate or
foreign commerce of the United States.

“(4) Each transfer under paragraph (2)
or paragraph (3) shall be made subject to-—

“(A) the termination thereof at any time
at which the Surgeon General determines
that the recipient thereof has failed without
adequate justification to (1) take prompt
and effective action to bring the develop-
ment to the point of practical application,
or (ii) make the development available,
upon terms and conditions determined by
the Surgeon General to be reasonable, for
use or exploitation by other parties within
the United States for public benefit; and

“(B) such other terms and conditions as
the Surgeon General shall determine, and
specify in making such transfer, to be re-
quired for the protection of the interests of
the United States.

(5) The Surgeon General shall transmit
to the Congress annually a full and complete
statement concerning— ’

“(A) the identity of the recipient of each
transfer made during the preceding calendar

ear with respect to any proprietary interest
any development subject to the provisions
this subsection;

“(B) the terms and conditions under
which each such transfer was. made;

“(C) the facts and circumstances relied
upon in justification for the making of each
such transfer; and

“(D) the use which has been made of all
developments with respect to which such
transfers have been made under this subsec-
tion at any time before the date of such re-

“(6) Whenever any development resulting
from any research or developmental activity
conducted in whole or in part with appro~
priated funds expended under authorization
of this titie or any proprietary interest in any
such developments is withheld or disposed of
by any person, organization, or agency in
contravention of any provision of this sub-
section or any condition imposed pursuant to
this subsection, the Attorney General shall
institute, upon his own motion or upon re-
quest made by any person having knowledge
of pertinent facts, an action for the enforce-
ment of such. provision or such condition in
the district court of the United States for
any judicial district in which any defendant
resides, ig found, or has a place of business.
Such court shall have jurisdiction to hear
and determine such action, and to enter
therein such orders and decrees as it shall
determine to be required to carry into effect
fully such provision or such condition.
Process of the district court for any judicial
district in any action instituted under this
paragraph may be served in any other judi-
cial. district of the United States by the
United States marshal thereof. Whenever it
appears to the court in which any such ac-
tion is pending that other parties should be

ght before the court in such action, the
may cause such other parties to be
ed from any judicial district of the
United States.
“(7) As used in this subsection—
“(A) the term ‘development’ means any

CONGRESSIONAL RECORD — SENATE

information, copyrightable material, use,
process, invention, patent, improvement or
innovation resulting from scientific or tech-
nological research or developmental activity;
and

“(B) the term ‘charitable public health or-
ganization’ means any organization described.
im section 501(c) (8) of the Internal Revenue
Code of 1954 which (i) is exempt from taxa-
tion under section 501(a) of such Code, (ii)
derives its income wholly or chiefly from
charitable contributions made by the public
at large, and (ili) expends its revenue chiefly
for the promotion of public health or the
alleviation of human suffering arising from
floods, earthquakes, fires, explosions, and
similar disasters affecting residents of the
affected areas.” :

Mr. YARBOROUGH. Mr. President,
I ask unanimous consent to have printed
in the Recorp, because time will not
permit my reading them, letters received
just a few days before hearings were
held in the Public Health Subcommittee,
of which I am a member, from both the
American Cancer Society and the Amer-
ican Heart Institute, approving the
Long amendment, and then, a day or
two before we voted, telegrams received
from them reversing their stand.

There being no objection, the letters
and telegrams were ordered to be
printed in the Recorp, as follows:

AMERICAN CANCER SOCIETY, INC.,
New York, N.Y., April 30, 1965.
BENJAMIN GORDON, Esq.,
Select Committee on Small Business,
U.S. Senate, Senate Office Building,
Washington, D.C. :

Dear Mz. Gorpon: The American Cancer
Society and I wish to express our apprecia-
tion for the courtesy and attention to our
problems in the area of the multiple sup-
port of research that you and the legisla-
tive staff for Senator Lone have extended.
We are particularly grateful that the pro-
posed amendment No. 14 to Senator Lone’s
amendment to bill 8. 512 recognizes the dif-
ferent status of charitable public health or-
ganizations and preserves their proprietary
interest in the results of research develop-
ments under which they have made sub-
stantial financial contributions.

In accordance with our discussions, it is
understood that, in presenting this amend-
ment, statements will be made for purposes
of legislative history indicating the intent
that this exception will be made automat-
ically operational and effective by providing
that the determination of the Secretary of
Health, Education, and Welfare will be
prompt and that the Attorney General’s ap-
proval will also be promptly furnished. Also,
unless objections or unusual problems are

‘raised, hearings will normally not be held or

required.

It was also discussed, and we believe suf-
ficiently important, that the legislative his-
tory of Senator Lone’s proposed original
amendment make clear that the require-
ments for information and other details will
not in any way include material which would
be contrary to, or interfere with, the estab-
lished doctor-patient relationship which
might underlie some of the research
activities.

Thank you again for the cooperation and
understanding that you have shown. We
feel that these proposals will resolve a
troublesome problem which otherwise would
have had an adverse effect upon the pro-
gress of medical research in fields of vital
importance to us all.

Sincerely,
Francis J. WILCOX,
Chairman of the Board.

O

14401

AMERICAN HEART ASSOCIATION, INC.,
New York, N.Y., April 29, 1965.
Mr. BENJAMIN GORDON,
Select Committee on Small Business,
Senate Office Building,
Washington, D.C. .

Deak Mr. Gorpon: We are most grateful
and appreciative of your good offices in as-
sisting in the preparation of an amendment
to Senator Lone’s amendment to Senate
bills Nos. 512, 596, and 597.

The attached has been reviewed by our
president, Dr. Carleton B. Chapman and Dr.
James V. Warren, the chairman of our legis-
lative advisory committee and we feel that
in our combined judgments this represents
@ very satisfactory solution to our problem.
We hope Senator Lone will consent and be
willing to consider this as an amendment to
his present amendments to the Senate Bills.

Again may we express our thanks to you.
and through you to Senator Lone for con-
sideration in this matter.

Sincerely yours,
Roms A. Brerrs,
Executive Director.

New Yor«, N.Y.,
/ June 3, 1965.
Senator LisTEr H..,
Chairman, Labor and Public Welfare Com-
mittee, U.S. Senate, Washington, D.C.:
The American Cancer Society noting the
current sentiment of the Senate
the policy on patents growing out of Fed-
erally sponsored research would like to re-
quest favorable consideration of 8. 512 with-
out inclusion of any amendments on patents
which were added to the original draft of the
bill as it was introduced on January 15, 1965.
: Hanoy S, Drew, M.D., uot
Senior Vice President for Research
and. Medical: Affairs.

New Yor, N.Y.,
June 4, 1965.
Senator Lister Hr,
Senate Office Building,
Washington, D.C.:

American Heart Association concurs. in
Senate action defeating Long amendment
on patent rights June 2. The association
is hopeful that this important matter may
now be resolved within the Judiclary Com-
mittee on an equitable basis since the asso-
ciation has major interest in the solution of
this problem. .

Rome A. Berrs,
Executive Director,
American Heart Association.

Mr. YARBOROUGH. Mr. President,
had the objections of the Senator from
Rhode Island (Mr. Pasrore] been valid,
that we should not legislate originally
on the floor of the Senate, in the sense of
taking up for the first time on the floor
of the Senate some amendments or
measures not considered in the subcom-
mittee, it would not apply to the Long
amendment, because the Long amend-
ment was considered by the subcommit-
tee and by the full committee, and I
filed individual views on it.

Mr. President, I ask unanimous con-
sent to have printed in the Recorp, from
Senate Report No. 368 on the bill, the
individual views which I set out in that
report.

There being no objection, the individ-
ual views were ordered to be printed in
the Recorp, as follows:

InpivipuaL Views or Mr. YARBOROUGH

While I enthusiastically support the broad
purpose of this legislation, I feel that the bill
would be greatly improved by the inclusion
of a requirement that the results of research
14402

ich is financed by public funds authorized
@:: this act be made freely available to

fe general public. If the public pays for the
research they should be entitled to the results
of it. No private citizen should be allowed
to acquire monopoly patent rights to the
results of research which is financed with
public funds.

In the case of research which is financed
partly with public funds and partly with pri-
vate funds, provision should be made for the
granting of an exclusive right to the private
researcher for a limited period of time (for
instance, 3 years) if such a right is justified
upon equitable considerations by the finan-
cial contribution made by the private re-
searcher and if the action will promote the
utilization of the development and the in-
terests of the public health and welfare in
the United States.

Through such a provision, the public in-
terest would be safeguarded at the same
time that the rights of private researchers
were recognized.

I commend the Department of Health,
Education, and Welfare for their efforts in the
past to protect the public interest. I feel,
however, that specific legislation is desirable
in order to make clear the intent of Congress
in the use of public moneys for research, and
to insure that the public interest be safe-
guarded by law. :
RALPH YARBOROUGH.

Mr. LONG of Louisiana. Mr. Presi-

dent, will the Senator from Texas yield ?-

-The PRESIDING OFFICER (Mr.
Youne of Ohio in the chair). Does the
Senator from Texas yield to the Senator
from Louisiana?

Mr. YARBOROUGH. I yield.
Mr. LONG of Louisiana. Let me com-
nt the Senator from Texas for the
cent fight he has always made
to protect the public from monopolistic
exploitation. During the time I have
had the opportunity to serve in the Sen-
ate, I have observed that the Senator
has been 1,000 percent consistent when-
ever a fight developed between the in-
terests of the public and the interests of
a small minority who would victimize
the public. The Senator from Texas has
never been found wanting in that re-

gard.

Mr. YARBOROUGH. Mr. President,
I thank the Senator from Louisiana for
his generous comments. I commend him
also.. The people of the United States
are fortunate in having a man of his
caliber serving on committees with the
dedication which he has always shown
to the people of the United States.

Mr. President, this country is enjoying
a period of high prosperity. The history
of the country shows that during a pe-
riod of high prosperity, when everyone
is doing well, the Government sometimes
gets careless.

During those periods of high prosperity
we find the greatest giveaways of the
public’s rights by the Government,
merely because people have become 50
prosperous they are not paying much at-
tention to what the Government is doing.

Today, I hope that we will pay atten-
tion, and secure for the people the right
to obtain early use of valuable drugs that
might be discovered with public moneys.

e Long amendment is only for the pur-

of protecting the public interest in

the public’s money, and the fruits of its
use. This is not a limitation upon pri-
vate rights. Every private researcher or

wena bn

CONGRESSIONAL RECORD — SENATE

plore, at his own expense, and keep all his
findings for himself.

The Long amendment is written in
such a way as to give a firm the exclu-
sive right to use a discovery for a limited
number of years, if they have contrib-
uted to that discovery. If they make the
discovery by themselves, they have an
unlimited right. And if they add their
moneys or their patents to the Govern-
ment moneys, they share the fruits of the
research. It is a fair amendment to re-
searchers and manufacturers.

Tt has been pointed out that American
drug manufacturers can both produce
and market exclusively, something drug
companies cannot do in most of the coun-
tries.of the Western World. This bill,
which I strongly support with or with-
out the Long amendment, will aid in
bringing about discoveries which are
badly needed by humanity, especially in
the ailments which today kill more
Americans than all other ailments com-
bined. .

Mr. President, I yield the floor.

Mr. LONG of Louisiana. Mr. Presi-
dent, I suggest at this time, because there
are few Senators in the Chamber, that
Senators who wish to speak in opposition
to the amendment who have used a
smaller amount of time than we have—I
believe they have used no time except 5
minutes for the calling of a quorum—

. speak at this time.

I believe that the side which offers the
amendment, by tradition, is entitled to
close debate. We have used 32 minutes
out of 60. Inasmuch as we are entitled
to close debate on the amendment, I urge
that Senators who wish to speak against
the amendment proceed at this point.

Mr. KENNEDY of Massachusetts. Mr.
President——

Mr. HILL. Mr. President, I yield 10
minutes to the Senator from Massachu-
etts [Mr. KEnnepy].

The PRESIDING OFFICER (Mr. GorE
in the chair). The Senator from Mas-
sachusetts is recognized for 10 minutes.

Mr. KENNEDY of Massachusetts. Mr.
President, I claim no special knowledge
in the area of patent policy, nor do I
have, or represent, any vested interest
other than my concern for health mat-
ters. I do have the most profound re-
spect for each of my colleagues who are
actively involved in this debate. Senator
McCLELLAN, as chairman of the Patents,
Trademarks, and Copyrights Subcom-
mittee of the Judiciary Committee is an
authority in this area, and I feel his views
cannot be lightly dismissed on any ques-
tion concerning patents. Senator Lone
is one of the most dedicated and sincere
Members. of this body and I often am in
sympathy with his views on matters of
pasic social interest. His concern with
the disposition of patent rights where
public funds are involved is to be com-
mended. I completely support his mo-
tives and desires in this area, and his
fight for the protection of the public in-
terest will, I am convinced, yield the re-
sults he seeks. I shall support him in a
major effort for sound, all-inclusive leg-
islation—but I cannot support ad hoc
amendments in the complex area of
patent policy. And Senator LisTER HILL
fe tha nndicnnted leader of the Senate.

June 28, 1965

indeed of the entire Congress,.in matters:
relating to the health and well-being of:
the country. I have nothing but ,the
most profound admiration for the work
of this Senator over the years—work that:
has directly resulted in unprecented ad-
vances against the causes and accom-.
panying misery of disease and iliness::
The position of Senator Hm. on this:
amendment should be of the greatest:
signifiance to all of us. :

The issue before us is whether there,
should be a national patent policy or
whether each piece of major legislation
should be amended to provide different:
policies for each agency or program.
The issue is not the pricing practices of.
the drug industry. 4:

We now have a presidential patent:
policy that was developed over a period:
of 20 months or more. This policy has.
worked well. We have not been in-«
formed of any abuses under this policy
in general, and as regards the Depart-
ment of Health, Education, and Welfare;
Senator Lone has stated that he has no
quarrel with their use of their patent au-
thority. Referring to HEW, Senator
Lone stated on Friday that “I am in sup-
port of the position that it has followed.”

So what we are concerned with here
is the necessity at this time to amend
various pieces of health legislation when
we are not confronted with an immedi-
ate need. We are asked to do this even
though Senator McCre.ian’s Subcom-
mittee on Patents is conducting hearings
on bills that would create a national pat-
ent policy. These hearings will, I am
sure, produce the protections in this area
that Senator Lone is asking for and the ©
protections that I support. But this
will be done after a full opportunity is
had to consider our national patent pol-
icy. This will not only assist Members
of the Senate to reach an informed opin-
ion but will also create less disruptions
in the research field. I have been in-~
formed by research men that I highly
respect from my State that the amend-
ment procedures currently being em-
ployed on patent policy could seriously
affect the cooperation between private
industry and university and medical re-
searchers. These people do not know
what future policy will be, for the
amendments that are offered are often
changed and their effects are never fully
discussed. Asa result, private research-
ers in industry are not anxious to ac~
cept any assistance from _ institutions
supported by Federal funds, and this
assistance would in many instances
speed up the development of vaccines
and drugs that are urgently needed. |

Mr. President, in the area of patent
policy and health we should be abso-
lutely sure of what we are doing. The
problem of preserving initiative in re-
search while protecting the public inter-
est cannot be solved in a day’s debate
on the Senate floor.

We have the time to consider our pat-
ent policy. A respected member of the
judiciary committee—Senator McCLet-
tan—is currently holding hearings on
this subject, and we are assured that the
existing presidential policy is working

well under the current administration.of .:;
June 28, 1965

1e Department of Health, Education,
and Welfare.

If this policy is to. be changed and
put into law, we should do that through
the Patent Subcommittee, and not by
a piecemeal approach through an
amendment process. The fact that we
do not act today does not mean that we
can never act. It does mean, however,
that when we do legislate we will be
fully informed and aware of the effects
of our actions.

Mr. President, I therefore will sup-
port the Senator from Alabama [Mr.
Hitt}, the Senator in charge of the bill,
in opposing the Long amendment.

Mr. President, I yield the floor.

Mr. MANSFIELD. Mr. President, I
suggest the absence of a quorum, and ask
unanimous consent that the time for
the quorum call be charged to the time
of the Senator from Alabama [Mr.
HAru!.

The PRESIDING OFFICER (Mr.
Brewster in the chair). Without ob-
jection, it is so ordered. The clerk will
call the roll.

The legislative clerk proceeded to call
the roll.

Mr. MANSFIELD. Mr. President, I
ask unanimous consent that further pro-
ceedings under the quorum call be dis-

pensed with.

The PRESIDING OFFICER (Mr.
Harris in the chair). Without objection,
it is so ordered.

e distinguished Senator from Missouri
as much time as he desires.

The PRESIDING OFFICER.
ator from Missouri is recognized.

Mr. SYMINGTON. I thank the able
and distinguished Senator from Ala-
bama, for yielding.

Mr. President, I have followed these
discussions with interest and care: I
have nothing but commendation for the
distinguished Senator from Louisiana
{Mr. Lone] in respect to his position on
the issue. He believes that he is pro-
tecting the rights of the Government, and
therefore of its citizens.

When a similar amendment came be-
fore the Senate during the discussion of
patents incident to space developments
in this country, many of the business peo-
ple, those who have and do not have
relationships with NASA, felt that the
amendment would be an infringement
on their basie rights under the capitalis-
tic system.

That includee small companies as well
as large companies.

This morning I received three tele-
grams from. three universities of my
State. The first comes from the Uni-
versity of Missouri, one of the institutions
of learning mentioned on the floor of the
Senate previously by the distinguished
chairman of the committee in question.
The telegram reads as follows:

I hope the Russell Long amendment on
patents will not be added to any appropria-
@:: for research. In our view it would dam-

@.:i HILL. Mr. President, I yield to

The Sen-

ge all universities research programs. The
subject needs far more study.
Ei.Meg ELLis.

_ The second telegram comes from the

foe ae eee ee NE OT neat Tinivrawciter

CONGRESSIONAL RECORD — SENATE

the Reverend Jerome Marchetti, S.J. It
reads:

We oppose proposed amendment whereby
patent rights in sponsored research in medi-
cal field become property of government.

Rev. JEROME L. MAncHETT!, S.J.,
Acting President, St. Louis University.

The third telegram, signed by Thomas
H. Eliot, chancellor of Washington Uni-
versity, reads:

On behalf of Washington University I
urge you to oppose the Long amendment to
the health, education, and welfare bill
scheduled to be voted upon at noon on
Monday. Departure from the long tradition
of patent law would be a grave mistake.
Your existing patent laws on research and
development has flourished and the Nation
has benefited. Dealing specifically with unt-
versities these are not profit institutions and
any patent royalties are spent by them for
the public benefit, for our universities must
strive if they are to provide good education
for the swiftly increasing number of young
Americans.

Tuomas H. ELior,
Chancellor, Washington University.

Mr. CARLSON. Mr. President, will
the Senator yield?

Mr. SYMINGTON. I do not have the
floor, but if- the Senator from Alabama
agrees, I shall be happy to yield.

Mr. HILL.. Certainly.

Mr. CARLSON. I should like to as-
sociate myself with the remarks made by
the distinguished Senator from Missouri
(Mr. Symrneton] in regard to the pend-
ing Long amendment. I have received
several communications from our State
which are thoroughly in accord with the
statements that have been read into the
Recorp by the distinguished Senator
from Missouri. I appreciate very much
his taking the position which he has
taken on the floor of the Senate today.

Mr. SYMINGTON. I thank the able
senior Senator from Kansas for his
remarks.

As one who has operated outside, and
in the Goverriment, I would worry about
complete Government control from the
standpoint of motive incentive in the
arts as well as engineering. On. the
other hand, I realize that some inter-
esting cases have been made on the
floor of the Senate with respect to fu-
ture policy in connection with this all-
important subject, and commend the
able Senator from Louisiana for his
interest.

Mr. President, I hope that the Senate
will accept the position taken by the
senior Senator from Arkansas [Mr.
McC e.ian} when he says that as soon
as possible he will complete hearings on
these measures now before his committee,
and currently before the Senate. Then
we can work out—and I would certainly
hope so; I shall do my part to that end—
a standard overall patent. policy for the
Government of the United States.

I thank the able Senator for yielding
to me.

Mr. HILL. Mr. President, I yield to
the distinguished Senator from Massa-
chusetts {Mr. SALTONSTALL] 5 minutes.

Mr. SALTONSTALL. Mr. President, T
thank the Senator. I have listened to
the Senator from Missouri, and I. am

hhaartily in asenen with what he has sai

14403

AsI see it, there are three reasons why we
should not support the amendment of
the distinguished Senator from Lou-
isiana, for whom I have a high regard.
He is most persistent and energetic in
anything that he undertakes. :

My first reason relates to the number
of differing patent policies that presently’
exist in the Government. If my memory
serves me correctly, there are today 20
departments of the.Government which
are doing research of one type or another.
We shall have 20 different policies if we
follow the proposed procedure. Shall we.
proceed in such & manner, or shall we™
have a policy that will be thoughtfully
worked out by the Senator from Arkan-
sas [Mr. McCLELLAN] and his committee? .:

The Senator from Arkansas [Mr..
McCLELLAN] has at least three bills on.
this subject before his committee at the
present time. There is a bill which. he
introduced, a bill which the Senator from
Louisiana introduced, and a bill which
I introduced. . There may be others. It
is our mutual desire to work out a careful
and thoughtful policy that will apply to.
all Government agencies. At the present
time, if this job is done piecemeal on the
floor of the Senate, we shall endanger
one of the most important aspects of
the American way of life. In the United
States we have gone ahead in many dif-
ferent fields through individual ini-
tiative, individual imagination, individual
patience, and willingness to work hard.
We know that from such work we derive
benefits through the discovery of patent-
able materials.

My second reason is based upon facts
brought out in the debate on the ques-
tion of patent rights disposition arising
out of NASA research and development
contracts. I am speaking from memory
now, but I believe there have been ap-
proximately 4,400 contracts entered into
by that agency since adoption. of its
recently revised patent waiver regu-
lations. Out of these approximately 4,400
contracts, NASA, under Mr. Webb, has
issued only 7 waivers at the time of con-
tract negotiation.

Mr. LONG of Louisiana. Mr.: Presi-
dent, will the Senator yield? :

Mr. SALTONSTALL. I yield.

Mr. LONG of Louisiana, I should be
glad to use some of my time in order that
I might ask a question.

The Senator has spoken about seven
waivers that were granted prior to any-
one knowing what might be discovered
under those contracts. The Senator
would find that a great number of addi-
tional waivers were granted and are
being granted on discoveries after they
are made. I suspect that they are being
granted on the very best things that
NASA is discovering, with applications
for waiver being made after the discov-
ery is made.

So what the Senator from Massachu-
setts is talking about is only what NASA
is doing in ways which I believe directly
violate the law. That is what the De--
partment of Justice advised the agency
some years ago.. They did not have the
right to waive those rights prior to know-
ine what might he develoned. Their
14404
wyers testified before us that they did

: ot think they had the power to do it.

I am opposec to waivers after a dis-
covery is made. But in my judgment,
waiver before discovery is a direct viola~
tion of law. Their own lawyers testified
as much before my subcommittee. They
said that waivers should not be made
without the parties even knowing what
would be discovered.

Mr. SALTONSTALL. I think the Sen-
ator for his observation. I believe that
the issue as to who should receive patent
rights under research and development
contracts should be determined, gener-
ally, at the time a contract is negotiated.
The parties should know their rights at
that time. In the bill that. I introduced,
we tried to deal with patent rights dis-
position in that way. The Government
would have the responsibility for making
the decision at that time. If a mistake
is made, or if conditions change, the
Government would have the authority to
revise its commitment.

It was not my intention to deal with
this particular subject, but I wanted to
cite this as an example.

My first reason, then, is that there
should be an overall general policy gov-
erning patent. rights disposition under
Government research and development
contracts. This is preferable to a hit-or-
miss policy adopted through the amend-
ment procedure.

My second argument is, as I sought to

ring out the other day, that if there
¢$ to be a patent policy established under
‘a health bill, this is not the bill on which
to do it. As I understand, from a read-
ing of the committee report—and that
is all that I am familiar with—it would
be mostly Government money that
would be used for construction in one
form or another, with little to be used
for research.

My third reason is based upon insur-
ing progress in our way of life. The best
way to accomplish this is by encourag-
ing individual initiative.

The PRESIDING OFFICER. The
time of the Senator from Massachusetts
has expired.

Mr. HILL. I yield an additional 2
minutes to the Senator from Massa-
chusetts.

Mr. SALTONSTALL. I well recall an
interesting evening some years ago when
I, together with several others, had din-
ner with Dr. Fleming, the discoverer of
penicillin. He told us that his discovery
of penicillin was incidental to work he
was performing on another subject. The
side issué was continually coming up.
Finally he concentrated on the side issue
and in that way discovered penicillin.

Is it proposed to take away from a
great scientist, a great doctor, a great
medical man, the rights to a discovery
that is his entirely? Ido not believe any
doctors take patent rights anyway. I
do not know whether Dr. Fleming ever
received anything from the discovery of

enicillin; But such a person, who may

working on an entirely different is-
sue, although supported by Government
money, should not have taken away from
him rights he may ultimately derive as

- hee Te ene hhaliawa

CONGRESSIONAL RECORD — SENATE

that is wise, unless based upon one gen-
eral policy.

For all these reasons, I hope that the
amendment of the Senator from Lou-
isiana will be rejected. ‘Then the Senate
can go forward to pass a bill which re-
lates to the extremely important subject
of public health.

I thank the Senator from Alabama
for the time which he yielded.

The PRESIDING OFFICER. Who
yields time?

Mr. LONG of Louisiana. Mr. Presi-
dent, how much time remains to the two
sides?

The PRESIDING OFFICER. Twenty-
eight minutes remain under the control
of the Senator from Louisiana; 20 min-
utes remain under the control of the
Senator from Alabama.

Mr. LONG of Louisiana. We have
more time remaining than they have?

The PRESIDING OFFICER. That is
correct.

Mr. LONG of Louisiana. Mr. Presi-
dent, I yield myself 4 minutes. I shall
reply briefly to one or two of the points
made.

It has been stated that I did not allege
that the Department of Health, Educa-
tion, and Welfare was not using its
powers correctly. The burden of my
argument has been that we should not
leave the stable door open with respect
to the billions of dollars spent for health
research and let the plunderers proceed
to put’ pressure upon people in Govern-
ment. agencies so as to-try to obtain pri-
vate monopoly rights on. research fi-
nanced by the Government.

I contend that the difference between
having drugs developec so that they are
immediately available to the public and
letting them be sold under a patent mo-
nopoly when the Government has paid
for the entire research results in a dif-
ference in price of about 30 to 1. There
is a difference between a person paying
14 cents for a pill for diabetes when the
pill has been developed by a private com-
pany and paying only half a cent for a

pili that has been developed by research ©

conducted with Government money.
Over a period of 10 years, the difference
in cost to a diabetic might be the differ-
ence between $1,600 and $48. That is the
kind of money we are dealing with.

Let me cite some of the things that
are taking place. I explained the other
day how Dr. Guthrie did some research.
He is a dedicated man, not seeking to
make a killing, not even interested in
patent rights. Yet his discovery, used
by the Miles Laboratories, sold at 40
times what it cost for manufacture, 40
times the cost of producing it, let us say,
in a small laboratory in Louisiana. For-
tunately, in that development, a fight
was made to protect the public interest.

But there are some cases in which
the public interest has not been protected
too well. I learned only recently about
one case. I made inquiry about it. It
deals with a development by Govern-
ment employees. The work was done in
National Institutes of Health laboratories
by Government employees. Merck &
Co. filed for patents for the Government

amanladaas and naia tha fase far filing

7

June 28, 1965

the patent. They provided the patent at-
torneys to create the presumption of
ownership in the company. No other
company, to my knowledge—and I be-
lieve this is correct-—-had access to the
work done by the National Institutes of
Health in this discovery. It is evident
that only Merck & Co. got the informa-
tion and know-how on those contracts.

In my judgment, a legitimate question
is whether Government employees were
actually working. fur the company or
working for the Government. They
were being paid by the Government.

This patent application was paid for by
Merck & Co. Merck & Co. apparently
has all the foreign rights to it. Yet
Merck did not spend a nickel in connec-
tion with developing the product. Only:
after I began to investigate and asked
to see the files did the employees assign
the patent to the Government. Up to
that time, it had not even been reported
to the Surgeon General. No request for
a determination had been made. This
had been done in violation of the law, so
far as I can determine. I am sorry to
say that the assignment came too late for
the Government to obtain its foreign
rights. The foreign rights were already
vested in employees who had made an
agreement with the private company, be~
fore the Government even had an op-
portunity to determine the kind of action
that would be in the public interest.

I can cite other cases, but the one I
have cited is an excellent example. The
patent was not assigned to the Govern-
ment, even for domestic uses, until after
I began an investigation. Even now, it
appears that the foreign market is being
exploited, because the private company
has the foreign patent rights, even
though the crug was developed with Gov-
ernment money in Government labora~-
tories. That is the kind of activity Iam
trying to prevent.

Pressures are being put upon tht Na~-
tional Institute of Health and the De-
partment of Health, Education, and
Welfare by private companies, using
every power at their command, to turn
over the Government findings to the pri-
vate companies, companies which did not -
spend. a penny and had nothing to do
with the research, but which seek the
information so that they can exploit the
public by charging anywhere from 30 to
1,000 times what the product should seli
for.

Much has been said about the messages
from universities, I inquired about that.
As best I can determine, some of the re-
search people were completely biased.
Dr. Lowell T. Coggeshall of the Univer-
sity of Chicago, who was presumed to be
impartial, has not been. He is.a director
of Abbott Labcratories, one of the big
drug concerns in this country. For
whom is he speaking? Abbott Labora-
tories or the university? |§ There is a di-
rect conflict of interest.

Another person, Dr. I. 8. Ravdin, of
the University of Pennsylvania, appeared
before the Kefauver committee and
testified for the Pharmaceutical Manu-
facturers Association. For whom is he
speaking? For the university or for the

Acenniation af Dharmanantieal Mann.
CONGRESSIONAL RECORD — SENATE

5 28, 1965
: turers? I inquired of the man who,

I understand, is chairman of the Patent
Committee of the Universities—at least,
he is responsible in that: connection—as
to what was his view on this subject.

‘The man whom I have in mind is the
vice president of Tulane University at
New Orleans. What did he say? He
spent the weekend looking into the mat-
ter. He said that the American Asso-
ciation of Universities has taken no
position and not looked into the mat-
ter. He said that the American Council
on Education has taken no position and
has not determined what its position
would be.

The PRESIDING OFFICER.
time of the Senator has expired.

Mr, LONG of Louisiana. Mr. Presi-
dent, I yield myself 1 additional minute.

The PRESIDING OFFICER. The
Senator from Louisiana is recognized for
1 additional minute.

Mr. LONG of Louisiana. Mr. Presi-
dent, he said that the Association of Land
Grant Colleges and State Universities
have not examined the question nor taken
a position on the matter, and neither
has the National Association of College
and University Business Offices. —

These are the people who presume to
speak for the institutions and they have
taken no position. However, on the
contrary, there are several organizations
such as the Wisconsin Alumni Fund—
which was prosecuted by the Attorney

@:: of the United States on an anti-

st action—which send telegrams and

say that they want the Long amendment
defeated.

Some universities are receiving grants
and royalties on some of the discoveries
and developments. The universities re-
ceive this income by signing monopoly
rights on work done for and paid for by
the Government. The amount of money
which they receive is very small when
compared to what the pharmaceutical
firms extract from the consuming public.

This is a most inefficient way by which
to subsidize education or research. If
we want to subsidize research or edu-
cation, we should do what is proposed in
the bill—appropriate the money to them.

The PRESIDING OFFICER. The time
of the Senator has expired. /

Mr. LONG of Louisiana. Mr. Presi-
dent, I yield myself 1 additional minute.

The PRESIDING OFFICER. The
Senator from Louisiana is recognized for
1 additional minute.

Mr. LONG of Louisiana. Mr. Presi-
dent, if we want to subsidize research, we
should do what is proposed to be done
in the bill. We should grant money from
the Treasury of the United States. How-
ever, to talk about subsidizing education
and research by permitting them to take
something that belongs to the people of
the country and to put some private firm
in position to charge 40 times what they
should charge for. it, and then to permit
them to come in here and say. that this

a great help to education because edu-

ration gets back 5 cents on the dollar
from the money which has been plund-
ered from the public is a pretty expensive
wav to subsidize education.

The

The PRESIDING OFFICER. Who
yields time?

Mr. Mi Mr. President, will
the distinguished Senator from Alabama
yield 5 minutes to me?

Mr. HILL. Mr. President, I yield 5
minutes to the distinguished Senator
from Arkansas.

The PRESIDING OFFICER. The
Senator from Arkansas is recognized for
5 minutes.

Mr. McCLELLAN. Mr. President, we
have a parliamentary situation which ex-
ists here that is apt to be overlooked by
Senators.

The real issue involved in the amend-
ment—arguments can be made on either
side—is whether we shall now abandon.
the committee system, do away with it,
and make an assault upon the committee
system in order to get an amendment
agreed to. No hearings have been held
on the amendment. The amendment
has not been examined by committee
process. No opportunities for hearings
have been offered. The amendment
deals with a vital problem confronting
this country.

Do we want to agree to abandon a
tried and valuable system that has been
established and has worked over the
years? In committee hearings, we have
the advantage of having both sides pre-
sent their cases, and then we can let the
Senate resolve the question.

Are we to resolve this question in an
ex parte fashion? If we should agree to
the proposed procedure at this time, we
would be abrogating every precedent that
we have followed in the committee sys-
tem of the U.S. Senate for so many
years.

Every chairman of a Senate commit-
tee has something at stake. Every com-
mittee member has something at stake.
Every Senator has a vital interest in
whether we agree to such a departure
from the established custom.

I know of cases that might be cited
otherwise. They will be referred to in
due course. I have made no commit-
ment. I have not resolved the case with
myself. There are cases and circum-
stances under which the Government
should take absolute title to a product.
However, there are other cases in which
it should not. I daresay there is not a
Senator today, including the author of
the amendment, who can stand on the
floor of the Senate now and tell us ex-
actly what this proposal would do. Itis
complicated. Anyone who argues that
the situation is not complicated does not
know what he is talking about. It is
highly complicated.

Mr. President, all we have to do to
determine the answer is to hold commit-
tee hearings and hear the testimony that
is presented. We have an issue which
we must resolve. I should like to see it
resolved in the interest of our country,
the welfare of our Government and of
our people. However, I am not ready to
depart from the committee system.

Mr. President, it would be a great favor
to me if such.a procedure were adopted.
The Senate might be doing me a personal
favor. The problem is now before my

yO

14405

committee. I did not seek the problem.
I happen to be chairman of the Subcom-
mittee on Patents. The issue is involved
in hearings before that subcommittee.
The subcommittee is in the process of
holding hearings on the subject now. I
propose to hear anyone on either side
who has anything to contribute. When
that record is made, this amendment
might be a proper issue for the Senate.
However, it-is not a proper issue at this
time unless we want to abandon the tra-
ditional committee procedures which are
followed in the processing of vital and
important legislation.

The PRESIDING OFFICER.
time of the Senator has expired.

Mr. HILL. Mr. President, I yield 2
additional minutes to the Senator from
Arkansas.

The PRESIDING OFFICER. The
Senator from Arkansas is recognized for
2 additional minutes.

Mr. McCLELLAN. Mr. President, the
Senator from Louisiana, who has offered
this amendment, said in debate on the
floor of the Senate last week:

Those in the Department of Health, Edu-
cation, and Welfare today follow a policy of
protecting the public interest.

That appears on page 14308 of the
ConcressionaL Recorp of June 25, 1965.
In the ConcrEssIONAL Recorp of the
same day, on page 14296, the following
language appears:
This subject has been studied at great
in various agencies, and as a result
HEW has decided to continue following the ~
policy which I advocate.

Mr. President, if that is true, where is
the emergency? Where is the urgency
to accomplish this purpose in an un-
orthodox way? Where is the necessity
for abrogating established policies in
order to effectuate agreement to this
amendment?

Agreeing to this. amendment would
establish a precedent that would come
back to haunt the Senate. What com-
mittee would feel that it had a duty im-
posed upon it to go into these contro-
versial issues thoroughly and present a
record here that would enlighten and
inform the Senate, and enable the Sen-
ate to pass judgment on and resolve the
issue?

If we were to agree to this amendment,
then when bills would be introduced,
they would be debated, and any Senator
could offer amendments on the basis of
his own ideas without hearings having
been conducted.

Surely we can ‘submit something for
the Recor», as is being done here today,
concerning isolated cases. Just as many
cases could be cited on the other side, if
this were a proper time and forum in
which to try the issue. However, it
would not be the proper forum unless we
want to permanently set the precedent
here of departing from established par-
liamentary procedures of processing
legislation.

Mr. SALTONSTALL. Mr. President,
will the distinguished Senator from Ala-
bama yield time to me for the purpose
of asking a question?

The
14406

Mr. HILL. Mr. President, I yield 1
Que to the distinguished Senator

- ‘om Massachusetts.

The PRESIDING OFFICER. The
Senator from Massachusetts is recog-
nized for 1 minute.

Mr. SALTONSTALL. Mr. President,
does the Senator not agree with me that
patent law is one of the most complex
fields of law, and that there are lawyers
throughout the country who confine
their entire practice to the knowledge
and practice of patent laws? Yet, on
the floor of the Senate we are trying to
agree on an amendment to the patent
Jaws of our country, an amendment
which relates to Government patent
policy. It is perhaps the most com~-
plex subject in the field of law.

Mr. McCLELLAN. The Senator is
correct. I have no fixed conclusions
about it. I have a desire to learn. I
have a desire to make a record here and
to receive testimony from all of those
who are interested and who have any-
thing that they can contribute that
would enable the Serate to legislate
wisely and in the public interest.

Mr. HILL. Is it not true that the
Senator has already started his hear-

ings?
Mr. McCLELLAN. We have heard 18
witnesses. We have scheduled more wit-

nesses for the 6th of next month, which
is the earliest we can schedule them for.
Anybody who wants to come before the
committee can do so. Statements can
placed in the record which can be

@.: and reflected upon. The other side
of the question can be represented.
Those statements can be placed in the
record. The Senate wil then have an
opportunity to sit in judgment on the
facts, and not on the basis of someone’s
opinion or argument which can be made
without regard to the facts.

Mr. HILL. The Senator has heard 18
witnesses?

Mr.McCLELLAN. Yes.

Mr. HILL. Are others scheduled to
be heard?

Mr, McCLELLAN. There are 12 more
witnesses to be heard.

Mr. HILL. The Senator is in the mid--

dle of hearing the case and going into
the case, examining the testimony, get-
ting the best available advice he can get
from the expert witnesses, and seeking
the benefit of their knowledge and ad-
vice. He is in the middle of that, and
now it is proposed to jump in and put
this provision in the bill.

Mr. McCLELLAN. We are still hear-
ing their testimony and getting their
help.

Mr. HILL. Mr. President, may I ask
the-Chair how much time I have left?

The PRESIDING OFFICER. The
Senator from Alabama has 11 minutes
remaining.

Mr. HILL. How much time has. the
Senator from Louisiana?

The PRESIDING OFFICER. The

enator from Louisiana has 18 minutes

maining.

‘Mr. HILL. I think the Senator from
Louisiana should us? some time.

Mr. LONG of Louisiana.. Mr. Presi-
dent, the matter of committee jurisdic-

CONGRESSIONAL RECORD — SENATE

The PRESIDING OFFICER. How
much time does the Senator yield him-
self?

Mr. LONG of Louisiana. I yield my-
self 4 minutes.

The question of committee jurisdic-
tion has been discussed. The Senator
from Louisiana started looking into this
matter back in 1959. He discovered
situations in 1959 that he concluded were
horrible. I refer to the matter of private

concerns getting the benefit of Govern-

ment research money. The Senator
from Louisiana went to the then Senator
from Wyoming, Mr. O’Mahoney, who
had done much work on the antitrust
field, and who.was then on the Judici-
ary Committee. Hearings were con-
ducted. He told me, as a personal mat-~
ter, “You are right, but we have a
great deal of power to fight and I will
need your help and all the help I can
get.” But no bill came from the Judici-
ary Committee.

There was no more able or sincere
antitrust and antimonopoly man on that
committee than the then Senator from
Wyoming, Mr. O’Mahoney, but nothing
came from the Judiciary Committee.
The Senator from Louisiana asked to
have a special committee to investigate
the whole patent question but nothing

‘eame of it.

I have in my hands three volumes of
testimony, very formidable documents.
The hearings were conducted by the
Monopoly Subcommittee of the Small
Business Committee, of which I am
chairman. Witnesses testified before
the committee and important informa-
tion was developed. I submitted this in-
formation to the Judiciary Committee,

Hearings were then conducted by the
subcommittee headed by the distin-
guished Senator from Arkansas, one of
the great Members of this body. Two
additional volumes came from that com-
mittee. I testified before the commit-
tee five times.

Mr. President, my investigation of
this question started about 1959. I did
what I could to get information as to
what the public interest required.

The PRESIDING OFFICER. The
time of the Senator has expired.

Mr. LONG of Louisiana. I yield my-
self 2 additional minutes.

My interest in this field started in
1959 and has continued until today, in
the year 1965. I determined to see to
it that any time a Senator wanted to
bring a research bill out of committee, I
was going to ask the question, “Are you
going to give money for the use of a
private company, or are you going to let
the public get the benefit of it?”

I have placed a memorandum of the
questions invelved on Senators’ desks.

With regard to doing this in the in-
terest of the public, I remind Senators
that we put such a provision in the
Helium Gas Act, in the Saline Water Act,
in the Solar Energy Act, in the Water
Resources Act, in the Coal Research Act,
and in the Regional Development Act of
1965.

Every time a bill comes out of com-
mittee providing for research funds, I
raise the question, “What do you want
to do with the money? Use it for the

June 28, 1965

someone in a position where he can
victimize the American people?”

I am seeking to amend the National
Public Health Act. The act comes under
the direct jurisdiction of the Committee
on Labor and Public Welfare. That is
the committee that should amend the
act when it needs correction or when it
finds fault with it. I submitted the
amendment and requested permission to
testify. Through some misunderstand-
ing, I was not permitted to testify. I am
sure it was not the fault of the Senator
from Alabama. There are individual
views filed by the Senator from Texas
supporting the amendment, which was
cleared with the Department of Health,
Education, and Welfare.

The President’s adviser in the White
House said he saw nothing wrong with
the amendment. Now I understand he
is opposed to it.

When we try to adopt a patent policy
that will apply to all the agencies, we
find it is impossible to have one policy in
effect for all of them. In the Depart-
ment of Defense the biz firms have estab-
lished a policy, and they have great
power. The same is true of the National
Space Agency. But when we provide
money for research, particularly in new
programs, I must ask why we are going
to do it. I think I have advocated flexi-
bility.

The PRESIDING OFFICER. ‘The
time of the Senator has expired.

Mr. LONG of Louisiana. Mr. Presi-
dent, how much time have we left?

The PRESIDING OFFICER. The
Senator from Louisiana has 11 minutes
under his control, and the Senator from
Alabama has 11 minutes. under his con-
trol.

Mr. YARBOROUGH. Mr. President,
will the Senator yield me a quarter of a
minute?

Mr. LONG of Louisiana. I yield the
Senator 30 seconds. .

Mr. YARBOROUGH. I ask unani
mous consent to have a three-page state-
ment inserted in the REcorD. .

There being no objection, the state-
ment was ordered to be printed in the
ReEcorp, as follows: .

SHALL THE PuBLic Get Irs Money’s WorTH?
THE ISSUE

When the Government pays billions. of
dollars for research, should the fruit. of that
research be freely available to the public or
should it be the private property of a com-
pany which worked for the Government on
& guaranteed profit basis?

HOW DOES A PRIVATE BUSINESS DO IT?

Private companies doing research or hir-
ing researchers always insist that whoever
pays for the research gets the patent rights
to it.

HOW DOES THE GOVERNMENT DO IT?

Until World War Il, private patents were
not granted on Government research. Most
agencies doing research are forbidden by
law from giving away patent rights. How-
ever, the Department of Defense spends most
of the money, and since World War II, it has
been granting private patent rights to com-~.
mercial application of its research. NASA is
permitted by law to grant private patents
when the Administrator finds lt “in the pub-
He interest,” which under pressure of con-
tractors, is tending toward. more and more

ek Ate A aneente ne | “Bind
CONGRESSIONAL RECORD — SENATE

é" 28, 1965
Aviation Agency is not bound by law,

but does not waive patent rights.

WHAT DOES THE DIFFERENCE MEAN AS APPLIED
: To DRUGS?

On the average, it means that the public
pays about 30 times the cost plus fair
profit at wholesale for drugs produced under
private patents. After a retail markup, the
public is paying about 60 times the cost of
production. (See table at page 14296, Con-
GRESSIONAL REcorD, June 25, 1965.) For ex-
ample, the latest oral medicine for diabetes
(replacing insulin) retails for about $14.40
per hundred pills—about 14 cents each. This
medicine—toloutamide—was discovered in
Europe. Upjohn—using the trade name
“Orinase” is the American licensee. The
drug sells at wholesale in Europe for about 3
percent of the wholesale price here.

WHAT ABOUT THE CASE WHERE THE COMPANT

HAS MADE SOME PROPORTIONATE CONTRIBU~

TION?

Under the proposed amendments the com-
pany could be given exclusive license priv-
fleges for 3 years under closely circum-
scribed conditions.

WHAT PERCENT OF MEDICAL RESEARCH IS DONE
BY GOVERNMENT?

The overwhelming bulk of it.

WHY HAVE SOME UNIVERSITY PEOPLE EXPRESSED
OPPOSITION? .

‘The leading university organizations have
taken no position on the issue, and are gen-
erally uninformed on it. Some few special
university-orlented persons have been im-
portuned by the drug companies, some of
which make contributions to research pro~
grams in university laboratories. Some of

ese contributions are no more than $500

1,000, but as tight as university budgets
these days, even small contributions are

portent:

19 ‘THE UNIVERSITY OR NON-PROFIT RESEARCH.

LABORATORY DISCOVERS SOMETHING VALUABLE

AT PUBLIC EXPENSE, SUCH AS A CURE FOR CAN-

CER, WHY SHOULD 7T NOT BE PERMITTED TO

LICENSE THE PRODUCTION AND USE THE ROY~

ALTIES FOR MORE RESEARCH?

The difficulty is that the licensee usually
gets only a small part of the profit and the
bulk. of the high monopoly profit—as much
as 90 percent of it—can be retained by the
private drug company acting as sole licensee.
This is a very inefficient way to aid either
research or education.

WHY NOT WAIT UNTIL THE M’CLELLAN SUBCOM-
MITTEE OF THE JUDICIARY COMMITTEE ACTS?
_ This same subcommittee has been looking
at the problem since 1961 without reaching
a conclusion. Meanwhile, Congress, espe-
cially the Senate, has been acting repeatedly
on new research programs to provide that
where research is authorized to be done with
public funds, the public will enjoy the full

benefit rather than place some private group .

in position to plunder the public interest.
As a matter of fact, three of the five mem-
bers of that subcommittee have voted twice
this year for amendments to other bills to
forbid private patents on new research pro~
grams.

ARE WE LIKELY TO ENACT. GENERAL LEGISLATION

ON THE SUBJECT AT THIS CONGRESS?

Hardly. If the legislation proposed would
drastically alter the policy of the Department
of Defense and NASA, there would be tre-
mendous opposition from a great number of
business interests, and the Judiciary Com-
mittee has a rule of free debate. For ex-

ple, the civil rights acts have either by-
ed the committee or they have been re-
with instructions to report on a cer-

tain day.

If the committee sought to enact a law to
guarantee private patents on Government re-

aanenh awed £6 6 shania noce the Senate ft

where Chairman Cetter and Subcommittee
Chairman WILus both have outstanding rec-
ords for opposing monopoly. You will never
satisfy both sides of this issue.

WHAT ABOUT INCENTIVE?

At least 99 percent of medical research
nowadays is done by dedicated men who are
motivated by the salary they are paid and
by their desire to benefit mankind. The
Dr, Guthrie case, discussed in debate, is an
example of how such a man can be horrified
to find that the public is being overcharged
fortyfold by a drug company in order to have
available the fruit of his research.

Most of these research doctors, chemists,
and scientists neither understand nor care
about the patent system. They will not have
the patents in any event. Most of them are
astute enough to know that in the last analy~-
sis, it is the U.S. Government that is paying
their salary and expenses—-not the company,
university, or institution through which the
money is funneled.

AND HOW ABOUT PRESERVING FREE ENTERPRISE?

If private patents are not permitted on
Government research then many companies
will compete in price for the public’s busi-
ness ahd the public will benefit. Competi-
tion is the fundamental element that assures
the public the benefit of even better prod-
ucts at even lower prices. No one on the sell-
ing end can be blamed for trying to avoid
competition, but those of us who have &
responsibility to the consumer would be dere-
lict of duty to permit monopoly conditions in
situations where it is clearly not justified.

IS THERE A DISTINCTION BETWEEN THE
HEALTH ASPECT OF THE PROBLEM AND THE
DEFENSE RELATED RESEARCH?

Some people think so. The Kennedy
memorandum said that patent rights would
not “normally” be permitted private con-
tractors in health-related research. Senator
Rrstcorr, former Secretary of Health, Educa-
tion, and Welfare, stated in debate that the
Government contributions in this field are
so overwhelming that he concluded this was
the area in which the case against private
patents was the strongest, and he will so
vote. Undersecretary Wilbur Cohen helped
to work out the Long amendment, and feels
that it adequatedy meets the problem. Sec-
retary Celebrezze does not oppose it.

SUMMARY

The question is simply whether the 196
million Americans, having paid for a cure
for cancer, heart disease, stroke and many
other diseases, are to be assured the new
medicines at low. competitive prices or
whether they will be required for the re-
mainder of their lives to pay monopoly
prices ranging from twenty to one thousand
times what those drugs could have been
availabe for.

To use orinase (for diabetes) as an ex-
ample, at European prices and under com~-
petitive conditions, it could be made avail-
able to a person requiring it for 36 cents per
month retail compared to $14. In I0 years
a diabetes sufferer would pay $43.20 in com-
petitive prices, compared to $1,680 when
sold under the American style of drug
monopoly. .

The orinase example is noteworthy because
it is one of many good drugs developed in
Europe under a different patent system, the
less rigid patent protection there permits
Europeans to have the product at prices far
below that which a licensed American drug
company—which did not discover the
drug—is able to extract from the public here.

Mr. SALTONSTALL. Mr. President,
will the Senator from Alabama yield to
me so that I may ask a question?

Mr. HILL. Iyield.

Mr. SALTONSTALL. The Senator

fo-
14407

want to give the benefits to 196 million
Americans, but we also wish to be sure
that those 196 million Americans receive
the benefits of further scientific re-
search that will advance their health
and advance our space efforts and our
military efforts. If we take away in-
centives to develop these inventions, we
are taking away much of the initiative
that will benefit these 196 million people.

Mr. LONG of Louisiana. Mr. Presi-
dent, I yield myself such time as I may
need to comment, but less than 1 min-
ute.

At least 99 percent of the research is
done by dedicated men who are moti-
vated by the salary they are paid and
by their desire to benefit mankind. The
Dr. Guthrie case, discussed in debate,
is an example of how such a man can
be horrified to find that the public is :
being overcharged fortyfold by a drug
company in order to have available the
fruit of his research.

Most of these research doctors, chem-
ists and scientists neither understand
nor care about the patent system. They .
will not have the patents in any event.
Most of them are astute enough to know
that in the last analysis, it is the U.S.

Government that is paying their salary

and expenses—not the company, univer-
sity or institution through which the
money is funneled.

If private patents are not permitted on
Government research then many com-
panies will compete in price for the pub-
lic’s business and the public will benefit.

Mr. BAYH. Myr. President, will the
Senator yield long enough for me to in-
ject a note into this discussion?

Mr. HILL. Mr. President, how much
time remains?

The PRESIDING OFFICER. Eight
minutes remain.

Mr. HILL. I yield 3 minutes to the
Senator from Indiana.

The PRESIDING OFFICER. The
Senator from Indiana is recognized for
3 minutes.

Mr. BAYH. Mr. President, the Sen-
ator from Louisiana continues to mention
the Guthrie example as one in which a
company has apparently indulged in
practices designed to penalize the pub-
lic and charge them unconscionable
prices for drugs.

I voted with the Senator from Louisi-
ana in his efforts last year to oppose
this kind of legislation, but I must say
that if the Guthrie case is the best
evidence the Senator has, I believe that
this demonstrates all the more the need
for more hearings. I talked with the
Senator and showed him that the in-
formation the Children’s Bureau gave
him was inerror. The Children’s Bureau
said that it costs 1.2 cents per test. The
record of the Children’s Bureau shows
that it cost 9.2 cents for the materials
alone to give the test. It does not cover
the cost of the labor or the advertising—
only the cost of the medicine which was
eight times the origii..l figure reported
by the Children’s Bureau.

It seems that it must be based on
specific facts. The Senator and the
Children’s Bureau alluded to the fact
that Miles Laboratories, through the
14408 . °

ey have never charged 52 cents.
y did charge 42 cents. Now the cost
Te down to barely over 20 cents a test.

An accounting study was made by the
firm of Price, Waterhouse & Co., which
I shall be glad to let the Senator from
Louisiana see—I placed it in the Recorp
in answeting one of his earlier state-
ments—that proved that the cost to
Miles Laboratories and to the Ames Co.
was 17.4 cents. It seems to me that this
is not an unreasonable burden which the
public should have to bear.

I wish to make certain that the public
receives the benefit of this research, but
when private enterprise goes to all the
troublee which Miles Laboratories and
the Ames Co. have, I do not believe that
it is unfair to request that they get a
modest return on the money which they
have spent.

Mr. LONG of Louisiana. Mr. Presi-
dent, I yield myself 1 minute.

The PRESIDING OFFICER. The
Senator from Louisiana is recognized for
1 minute.

Mr. LONG of Louisiana. Mr. Presi-
dent, I have not responded to the Sen-
ator’s statement concerning Miles Labo-
ratories, but I have prepared an answer
to it, and I shall be glad to make it avail-
able to him, if he will read it, before I
place it in the Rzcorp. This is the in-
formation which Miles Laboratories pre-
sented; and I am sure the Senator
realizes it is a self-serving statement of
Miles Laboratories. I prepared an an-

er to that, made by persons who are

@ vise and prejudiced and have no
cial interest in the matter.

Mr. BAYH. ‘This is supported by one
of the most reliable accounting firms in
the country-—.

Mr. LONG of Louisiana. Which they
hired. Let me speak for a moment on
this point: The Massachusetts Public
Health Service estimated that the test
cost 1.2 cents. Here is a statement

which I believe is an adequate answer, .

showing that this was one good example
of exploitation of the public interest.
I was saying to the Senator, whether he
agrees with it or not, that he should take
2 look at this statement in any event. I
believe that he will find these people are
being exploited by the abuse of patent
rights. If he will take a look at the
statement, I am sure he will agree with
me.

Mr. BAYH. Mr. President, will the
Senator yield me 30 seconds to respond
to the Senator from Louisiana?

Mr. LONG of Louisiana. Why does
not the Senator read the statement be-
fore he responds?

Mr. BAYH. I suggest that the Sena-
tor from Louisiana read this Govern-
ment document. A book entitled—

The PRESIDING OFFICER. Just a
moment—who yields time?

Mr. LONG of Louisiana. I yield 30
seconds to the Senator from Indiana.

The PRESIDING OFFICER. The
Senator from Indiana is recognized for

0 seconds.
@ Mr. BAYH. There is a book entitled
PKU,” published by the Department
of Health, Education, and Welfare which
is hardly a self-serving institution.

CONGRESSIONAL RECORD — SENATE

A list of the tests appears on page 32—
665,902 in number. If the Senator will
take the figure and divide into that the
cost of the material in the report of the
Children’s Bureau, he will find that the
cost of the materials was approximately
9.2 cents.

The PRESIDING OFFICER. The
time of the Senator from Indiana has
expired.

Mr. LONG of Louisiana. I hope the
Senator will read the statement I have
made. The Senator, of course, is a great
believer in the public interest up until
one of his constituents, such as Miles
Laboratories, comes into the picture,
then the Senator forgets about the rest
of his constituents.

I hope that by his vote he will con-
sider the overall interest of the public
in this problem.

The PRESIDING OFFICER. Who
yields time?

Mr. HILL. Mr. President, how much
time remains?

The PRESIDING OFFICER. The
Senator from Alabama has 7 minutes
remaining and the Senator from Lou-
isiana has 8 minutes remaining.

Mr. BAYH. Mr. President, will the
Senator from Louisiana yield me 15 sec-
onds?

Mr. LONG of Louisiana. I yield 30
seconds to the Senator from Indiana.

The PRESIDING OFFICER. The
Senator from Indiana is recognized for
30 seconds.

Mr. BAYH. I am certain that the
Senator from Louisiana in referring to
one of my constituents is well aware
that I have more than 5 million of them,
and I am not going to let the private
interests of one corporation alter what
I feel to be the best interests of my 5
million constituents, to whom the Sena-
tar refers.

The: PRESIDING OFFICER. Who
vields time? ~ .

Mr. HILL. Mr. President, I yield 2
minutes to the distinguished minority
leader. :

Mr. DIRKSEN. Mr. President, earlier
today, the distinguished Senator from
Texas [Mr. YarsoroucH] said:

I regret that Senators on the other side
of the aisle are not represented on the floor
today.

That is an unkind and uncalled for re-
mark, because Senators are in and out
of the Chamber all the time, answering
telephones, greeting visitors, and so forth.

He said further:

Maybe their consciences would not permit

them to listen.

As if the Senator from Texas has the
only conscience in the Senate. That, I
have got to see.

The Senator continues:

_ There was a time when Republicans like
Borah, Norris, McNary, and LaFollette stood
up, when the minority was on our side of
the aisle, fighting to protect the public in-
terest.

I suppose the Senator from Texas is
the only defender on a white charger who
has the work of keeping the public in-
terest.

The Senator continues:

LS
June 28, 1965

I hope, whichever way the vote goes, that
Senators on this side of the aisle will not
vote to betray the public interest. I hope
the great majority of the Democrats will cast
their votes for the Long amendment. i

Well, now, I am against the amend-_
ment and I do not yield for a moment to”
the Senator from the greatest unfrozen
State in the Union when it comes to an
interest in the public interest, and when
it comes to a conscientious approach to,
the problem.

The Senator from Texas should not

have said these things on the floor of the

Senate. It is not becoming of him.

Mr. YARBOROUGH. Mr. President,”
will the Senator yield? :

Mr. DIRKSEN. I yield, if I have time.

The PRESIDING OFFICER. The.
time of the Senator from Lllinois has
expired. :

Mr. YARBOROUGH. Mr. President,
will the Senator yield?

Mr. DIRKSEN. I have no time.

Mr. LONG of Louisiana. Mr. Presi-
dent, I ask unanimous consent that we
might have 2 additional minutes in or-
der that the Senator may respond, and
that I may then respond to the response?

The PRESIDING OFFICER. Is there
objection?

Mr. McCLELLAN. That is 2 minutes,
and 2 minutes, and 2 minutes.

The PRESIDING OFFICER. Is there
objection? The Chair hears none, and
the Senator from Texas is recognized for
2 minutes.

Mr. YARBOROUGH. Mr. President,
it is shocking that the minority leader
should protest the tribute that I paid to
such great members of his party in the
Senate as Borah of Idaho, La Follette of
Wisconsin, McNary of Washington, and
Norris of Nebraska. Norris, the father
of TVA, who stood with Franklin Delano
Roosevelt and cried at the dedication
of the great TVA dam when Frank-
lin Delano Roosevelt put his arms around,
not a Democrat, but a Republican, Sen-
ator Norris, and. said to him, “To you,
more than to any other one man, we owe
this; you saved the TVA.”

This was done by Senator George Nor-
ris in the area of the public interest—in
protecting the public interest.

Now we have a fight to keep this sub-
ject in the public domain, and today the
minority side was unrepresented on the
floor in a time of crucial debate.

I do not claim to be the leader in this
fight; I am merely a worker in the vine-
yard. The Senator from Louisiana is the
jeader and has worked, of course, in the
Senate for approximately 20 years now,
and other Senators have led with him—
the Senator from Alabama [Mr. Hr]
has led in public health, and I am as-
tonished to hear the Senator say that I
should be ashamed of that tribute that I
paid to men, Republicans like Norris, and
La Follette—I recall from reading history
that Bob La Follette’s grandfather and
Abraham Lincoin’s father used to sit on
juries together in Kentucky and out of
these two lines of American blood came
great leadership, which added so much
of distinction to American history—both
were on the side of the aisle that the dis-
June 28, 1965

tinguished minority leader represents so

ly.

I believe that the Senator from Mlli-
mois should be extolling the fact—as I
did—-that while those Republicans were
fighting for the public interest they—

Norris, Borah, McNary, and La Follette— .

were fighting against the majority on
their own side of the aisle. My major
plea was to the Democrats on this side
of the aisle to disregard the telephone
calls they may have received, and to
vote for the public interest as Norris,
McNary, and La Follette did, whether
or not they were in the majority in their
own party. My plea was primarily to
the Democrats in my party; I had no
reason to hope that the other party
would listen to my pleas. I think it is
not a matter of party, but of conscience
of each Senator, and I claim no superi-
ority to anybody else. Each Senator
knows his own duties and obligations
and hopes and aspirations. I call upon
their conscience on this bill, but I do not
purport to sit in judgment on the con-
science of any other man.

I plead with my fellow Democrats to
fight in the public interest. My interest,
when I made my statement, was that a
majority on this side vote with the Sena-
tor from Louisiana, regardless of what
the minority does.

Mr. HILL. I ask unanimous consent
that the minority leader may have 1
minute in which to make answer.

The PRESIDING OFFICER. Without
objection, it is so ordered.

Mr. DIRKSEN. Mr. President, there
@» an abler Senator to completely beg

e question. No man has a mind more
adroit than that of my friend from
Texas in picking out a few names and
missing the whole substance of what was
said. It was a reflection upon the con-
seience of Senators and their interest
in the public domain.

The Senator from Texas can raise his
voice from now until doomsday, but it
will not change the content of his utter-
ance on this floor earlier today.

I shall let people read the Recorp, be-
cause here are the words that were
spoken.

Mr. YARBOROUGH. = Mr. President,
will the Senator from Louisiana yield me
5 seconds?

Mr, LONG of Louisiana. I yield 5 sec-
onds to the Senator from Texas.

Mr. YARBOROUGH. I thank the
very able Senator from Mlinois for his
kind remarks about my ability. I claim
no such achievements. But the vote to-
day will be its own voice and no one can
change it from now to doomsday. Me-
thinks he doth protest too much.

Mr. HILL. Mr. President, how does
the time stand?

The PRESIDING OFFICER. The
Senator from Louisiana has 6 minutes
remaining; 5 minutes remain to the
Senator from Alabama (Mr. HILL].

Mr. HILL. I yield myself 5 minutes.

On last Thursday, speaking for the
large majority of the Committee on La-
Ges Public. Welfare, I opposed the

ndment. Today I oppose the

endment, as I must, as chairman of

the Committee on Labor and Public
Welfare.

CONGRESSIONAL RECORD — SENATE

I have received many letters and tele-
grams and communications from presi-
dents and deans and scores of faculty
members throughout the United States
in opposition to the amendment.

As I cited the other day, such volun-
tary organizations in the field of health
as the American Heart Association, the
American Cancer Society, the Associa~
tion of American Medical Colleges, and
the American Association of Colleges of
Pharmacy also oppose the amendment;
as do the National Academy of Sciences
and the American Council on Education.
Many other such organizations have
stated their opposition.

The Johnson administration also op-
poses the amendment. Dr. Donald F.
Hornig, the director of the Office of
Science and Technology at the White
House, is also opposed to the amend-
ment. He appeared before the commit-
tee of the distinguished Senator from
Arkansas only a few days ago and said
that this matter should be carefully
considered, that it should be thrashed
out, and that those with experience and
knowledge in this field should be called
in. Legislation should be passed, but
only after we have had testimony by
expert witnesses.

Let me make this point clear. The
opposition to the amendment is not
based on rigid resistance to modifying
the existing Kennedy-Johnson govern-
ment patent policy. It is based on the
conviction that any changes in Govern-
ment patent policy should be adopted
only after careful consideration and
after an opportunity for full and fair
presentation of the views of all inter-
ested organizations and individuals.

As the distinguished Senator from
Arkansas has stated, his subcommittee
of the Committee on the Judiciary has
within recent days heard 18 witnesses
on this subject, and at least 12 more
witnesses remain to be heard. The sub-
committee is proceeding according to
the rules and procedures and precedents
of the Senate in having witnesses come
in to make their presentation, and then
having the committee make its report
to the Senate.

The present patent policy was adopted
in 1963, following more than a year of
interagency discussion on the basis of
recommendations from 20 Federal agen-
cies and non-Federal authorities. Un-
der this policy, every grantee and every
contractor of the Department of Health,
Education, and Welfare can be compelled
to issue licenses. The Kennedy-John-
son patent policy is an effective policy
and it is protecting the consumer. No
monopoly or exclusive control is in-
volved.

This fact was brought out by the Sen-
ator from Indiana (Mr. BayH] with ref-
erence to the PKU tests, carried out by
the Miles Laboratories, through discov-
eries made by Dr. Guthrie. The Sur-
geon General insisted that under our
policy the results of the research be
made available to everyone, no matter
who he was or what he was. That was
done.

The Senator from Louisiana [Mr.
Lone] on the floor of the Senate ap-

/
14409

plauded the U.S. Public Health Service
for what it had done under the Kennedy-
Johnson patent policy in protecting the
rights of all the American people.

The Senator from Louisiana. stated
that credit for this action on behalf of
the public must be given to Dr. Luther L.
Terry, the Surgeon General, and to Dr.
David E. Price, the Deputy Surgeon Gen-
eral, and all the staff people connected
with this action.

I know that Senators will agree with
me when I say: “Praise from Caesar is
praise, indeed.”

The Senator from Louisiana has sought
today to impeach some of the witnesses
who have protested against the amend-
ment. He said that we have heard
nothing from the American Council on
Education. The truih is that we re-.

ceived a letter from Dr. Logan Wilson,

who is the director of the American
Council on Education, in which he
said——

The PRESIDING OFFICER. The
time of the Senator has expired.

Mr. HILL. Has all my time expired?

The PRESIDING OFFICER. All
time of the Senator has expired. .

Mr. LONG of Louisiana. Mr. Presti-
dent, I ask unanimous consent that the
Senator may proceed for 3 additional
minutes.

The PRESIDING OFFICER. Is there
objection? The Chair hears none, and
it isso ordered.

Mr. HILL. I merely wish to call at-
tention to some of the witnesses who
testified. :

Dr. Wilson said:

May I respectfully suggest that a policy
issue of such great significance should be
studied carefully, as a substantive matter,
by committees in both Houses of the Con-
gress. Such an approach would assure
constructive changes in present policy and
at the same time avoid unforeseen and pos-
sible disastrous consequences that. might
occur as a result of wholesale changes oc-
casioned by the proposed amendment.

I have a communication from. Dr.
Frederick Seitz, president of the Na-
tional Academy of Science, in which he
says:

We know far too little of the possible
consequences of changes envisaged by the
proposed amendment to warrant its approval
without a very broad and painstaking in-
quiry.

From the Association of American
Medical College there comes a communi-
cation signed by Robert C. Berson, ex~-
ecutive director. He says:

The development and distribution of
scientific instruments and devices, such as
electronic pacemakers, artificial kindeys,
and hopefully other artificial organs, 1s
properly a function of instrument manu-
facturers who may need some protection of
patent rights to continue this activity. If
further refinements of this policy are de-
sirable, we would urge that legislation to
that end be carefully studied by appropriate
committees.

I have before me a communication
from the University of the Pacific in
California and another from the Uni-
versity of California. Prof. D. J. Cram
of the University of California at Los

Angeles stated: :
14410 ,

eo At the very least, extensive hearings on
me proposed Long amendment should be
. entertained to determine the public interest
in this important matter.

T have also in my hand a communica-
tion from Mr. Karl Folkers, president of
the Stanford Research Institute, point-
ing out how important this matter is and
how it should be gone into with the
greatest care by a committee before any
action is taken.

I have before me a communication
from Prof. Arnold D. Welch, of Yale
University. I shall not read all of the
communication because my time is lim-
ited. In part he said:

I must speak most strongly to the effect
that the Long amendment would seem to
me to exert a devastating effect on the future
development of new drugs in this country.

The PRESIDING OFFICER. The
time of the Senator has expired.

Mr. HILL. Mr. President, will the
Senator yield me 1 more minute?

Mr. LONG of Louisiana. I yield 1
additional minute to the Senator from
Alabama.

Mr. HILL. I shall not quote all of the
communications, but I point out that
in addition to the ones I have read, I have
received communications from the Flor-
ida State University, the Medical College
of Georgia, and the head of the Depart-
ment of Chemistry at the University of
Illinois. He is also past president of
the American Chemical Society. He is

ast president of the American Associ-
@iicn for the Advancement of Science.
a communication, Roger Adams

The Long amendment is certainly not in
the public interest for it would deter devel-
opments rather than expedite them and
many potential industrial products of in-

terest to the public would never be developed...

I have a communication from Johns
Hopkins University stating: ;

Such an amendment would have a severely
limiting effect on. clinical pharmacologists
like myself.

From that same university I have a
communication from a famous woman
doctor, Dr. Helen B. Taussig, who, along
with Dr. Blalock, did the first open heart
surgery. In that letter, Dr. Taussig said:

Just a line to let you know that I am
strongly behind your bill.

The PRESIDING OFFICER. The
time of the Senator has expired.

Mr. HILL.. Mr. President, I ask unan-
imous consent that other statements of
a like character which I hold in my
hand-—-and there are many from all over
the United States—-may be printed in the
ReEcorp at this point.

There being no objection, the commu-
nications were ordered to be printed in
the Recorp, as follows:

Excerpts From Lerrers To SENATOR LISTER
Hr. or ALABAMA IN OPPOSITION TO .THE
AMENDMENT OF SENATOR RUSSELL LONG |

AMERICAN HEART ASSOCIATION
Rome A. Betts, executive director, Ameri-
Heart Association (June 7, 1965):

“American Heart Association concurs in
Senate action defeating Long amendment on
patent rights June 2. The association is
hopeful that this important matter may now
be resolved in the Judiciary Committee on

CONGRESSIONAL RECORD — SENATE

an equitable basis since the association has
major interest in the solution of this
problem.”

AMERICAN COUNCIL ON EDUCATION

Logan Wilson, director, American Council
on Education:

“May I respectfully suggest that a policy
issue of such great significance should be
studied carefully, as a substantive matter,
by committees in both Houses of the Con-
gress? Such an approach would assure con-
structive changes in present policy and at
the same time avoid unforeseen and possible
disastrous. consequences that might occur
as a result of wholesale changes occasioned
by the proposed amendment.”

NATIONAL ACADEMY OF SCIENCES

Frederick Seitz, president, National Acad-
emy of Science:

“I myself feel that the committee's conclu-
sion is erititled to great respect as a general
proposition. I particularly feel that we
know far too little of the possible conse-
quences of changes envisaged by the pro-
posed amendment to warrant its approval
without a very broad and painstaking
inquiry.”

ASSOCIATION OF AMERICAN MEDICAL COLLEGES

Robert C. Berson, M.D., executive director:

“The development and distribution of sci-
entific instruments and devices, such as
electronic pacemakers, artificial kidneys, and,
hopefully, other artificial organs, is properly
a function of instrument manufacturers who
may need some protection of patent rights
to continue this activity. If further refine-
mente of this policy are desirable, we would
urge that legislation to that end be carefully
studied by appropriate committees.”

AMERICAN CANCER SOCIETY

Harold S. Diehl, M.D., senior vice president
for research and medical affairs, American
Cancer Society: ‘“‘The American Cancer So-
ciety, noting the current sentiment of the
Senate regarding the policy on patents grow-
ing out of federally sponsored research, would
like to request favorable consideration of
S. 512 without inclusion of any amendments
on patents which were added to the original
draft-pf the bill as it was introduced on Jan-
uary 15, 1965.”

CALIFORNIA

Robert. E. Burns, president, University of
the Pacific: “We feel * * * that the Federal
Government’s existing policies on patents
and copyrights with respect to federally sup-
ported research are equitable and reasonable
and have not impaired either the flow of in-
formation or the transfer of research dis-
coveries into useful healing and life-saving
procedures. * * * It is our sincere hope
that your committee will see fit to reject
Senator Lonc’s amendment.”

D. J. Cram, professor of chemistry, Univer-
sity of California, Los Angeles: “At the very
least, extensive hearings on the proposed
Long amendment should be entertained to
determine the public interest in this impor-
tant matter.”

Karl Folkers, Ph. D., Sc. D., president, Stan-
ford Research Institute: “As a general rule,
Stanford Research Institute does not com-
ment on pending legislation. However, there
is a piece of proposed legislation before your
Committee on Labor and Public Welfare
which bas such far-reaching implications to
research and development in the United
States that I feel some comment is in order.

- Y am referring to the so-called Long amend-

ment. * * * The importance of developing
a sound, workable Government patent policy
is so great that I would like to urge that the
Long amendment be tabled until there can
be a complete study and public hearings on
the subject.”

Lee A. DuBridge, president, California In-
stitute of Technology: “The sweeping pro-

7
JO
June 28, 1965

visions of the Long amendment would elim-
inate discretionary powers to take account of
special circumstances. Furthermore, the
provisions of this amendment have not been
adequately studied as to their possible tm-
pact on the public welfare.”
CONNECTICUT

Arnold D. Welch, Ph. D., M.D.; Eugene Hig-
gins, professor of pharmacology, Yale Uni-
versity: “I must speak most strongly to the
effect that the Long amendment would seem
to me to exert a devastating effect on the
future. development of new drugs in this
country, and I sincerely and strongly urge
that extensive hearings be held on this sub-
ject, if necessary, with a view to making any
influence of Government funds upon coop-
erative research between Government gran-
tees and industrial organizations reflect the
true spirit of cooperation, rather than puni-
tive control, as seems to be proposed by the
Long amendment.”

FLORIDA |

Werner Herz, professor of chemistry, the
Florida State University: “My letter in this
instance is prompted by the strong belief
that the Long amendment, while superfi-
clally in accord with a policy I have favored,
will in fact do harm rather than good.”

GEORGIA

Robert B. Greenblatt, M.D., professor, De-
partment of Endocrinology, Medical College
of Georgia: “As one who has done consider-
able research with drugs provided me by
various pharmaceutical houses, I am deeply
concerned. This amendment could deprive
me of the opportunity to work with many an
interesting compound which could help in
the advance of our knowledge and help keep
the United States in the forefront of medi-
cal research. * * * as the recipient of five
awards from the American Medical Associa-
tion I believe I speak with some authority
in saying that I do not believe the amend-
ment necessary nor does it in any way en-
hance the general good of drug research.”

ILLINOIS

Roger Adams, University of Illinois, head
of the chemistry department; emeritus past
president, American Chemical Society; past
president, American Association for the Ad~
vancement of Science: “The Long amend-
ment is certainly not in the. public interest
for it would deter developments rather than
expedite them and many potential indus-
trial products of interest to the public would
never be developed.”

MARYLAND

Louis Lasagna, M.D., Division of Clinical
Pharmacology, the Johns Hopkins University:
“Such an amendment would have a severe-
ly limiting effect on clinical pharmacologisis
like myself who are sometimes eager to par-
ticipate in drug research in its early and most
difficult stages. I hope it wiil be possible tc
pass bill S. 512 without this undesirable
amendment.”

Helen B. Vaussig, M.D., professor of pedi-
atrics (emeritus), the Johns. Hopkins Hos-
pital: “Just a line to let you know that I
am strongly behind your bill S. 612 and feel
that the Long amendment to S. 512 takes the
teeth out of your bill and would make it
hard for the National Institutes of Health
and the other Federal organizations inter-
ested in advancement of medical know-how,
would find great difficulty in placing con-
tracts."

MASSACHUSETTS _

J. M, Hayman, Jr., M.D., dean, Tufts Uni-
versity School of Medicine: “Certainly the
Government should have an interest in the
product of the research it supports. There
can be no quarrel with that. But the Long
amendment, as written, is manifestly unfair
to the university.”
CONGRESSIONAL RECORD — SENATE

une 28, 1965
M. Kent Wilson, chairman, Department of

Chemistry, Tufts University School of Medi-
cine: “The Long amendment would do seri-
ous damage to the fruitful cooperation be~-
tween all facets of the scientific community
and, therefore, in my judgment is against
the public interest.”

Chester S. Keefer, M.D., former special as-
sistant to the Secretary of HEW for Heaith
and Medical Affairs: “I respectfully urge that
action. be deferred on the Long amendment
until the Congress has had the opportunity
to determine the basic guidelines of Gov-
ernment patent policies.”

MICHIGAN

Robert C. Edlerfield, professor of chem-~
istry, University of Michigan: “Protest this
(Long amendments) to the extent. of my
ability and solicit your efforts to defeat them.
I speak solely as an individual with no con-
nection with any drug house but as one with
experience in this area who has developed
the only practical curative drug for relaxing
malaria which has been properly assigned to
the Government. As a former chairman of
the National Research Council Division of
Chemistry and a member of the National
Academy of Sciences I feel that I have a
sufficiently objective view to consider Sena-
tor Lone’s proposals with serious alarms.”

MISSISSIPPI

Lewis Nobles, dean, the Graduate School,
the University of Mississippi: “In my opin-
ion, the Long rider, if adopted, would greatly
hamper all of our efforts (university, Gov-
ernment and industry) to improve research
relations among university, industry and
Government personnel.”

MISSOURI

Elmer Ellis, president, University of Mis-

uri: “I am not advocating undue protec-

on for any private interests which may
be involved in this problem, but simply
stressing the value of the patent policy
to our total national interests and the danger
involved if ‘ve automatically remove bene-
fits of the patent policy from any and every
activity whicn may have received any type
of Federal support.”

: NEBRASKA

John P. Lambooy, Ph. D., professor of bio-
chemistry, the University of Nebraska, Col-
lege of Medicine: “If the Long. amendment
is applied to all Government-supported re-
search, the real vigor in science in the United
States of America will quite simply and ul-
timately disappear from the scene.”

NEW JERSEY

Robert F. Goheen, president, Princeton
University: “Present patent policies can
probably be improved. However, this com-
plex and important subject merits its own
thoughtful and exhaustive study, and it
should not be approached by the hasty at-
tachment of amendments to any and all bills

having to do with Government sponsored |

research.”
NEW YORK
Dr. W. H. Sebrell, Jr., professor of nutri-
tion, Columbia University: “As you are well
aware, there are many difficult problems to
be resolved in reaching a fair decision in so
complicated a matter, particularly since
university, commercial, and Government sup-
port are all concerned in medical research
accomplishments. No one questions that
the Government should have an interest in
the results of the research to which it has
contributed. However, the Long amendment
appears to me to be unfair to the other
terests that are concerned. I would, there-
e, like to urge that you give your support
deferring the Long amendment until there
has. been thorough consideration of the
broad questions involved in arriving at a
sound and fair patent policy for Government-
supported research.

“One of the very great things about Amer-
ican research has been the way in which
Government, industry, and the universities
have worked together. The question of
patent policy is too important to allow a
hurried decision to jeopardize the very basis
of the excellent progress we are making.”

James M. Hester, president, New York
University: “The Long amendment removes
discretionary powers from the administrative
heads of agencies and makes the proposed
policy mandatory. The Office of Science and
Technology has well stated the complexity
of the situation and the need for full con-
sideration of the wide range of issues in-
volved.”

NORTH CAROLINA

James W. Bawden, assistant dean and co-
ordinator of research, Dental Research Cen-
ter, University of North Carolina: “I urge
that you oppose passage of this legislation.
We have given careful consideration to the
situation and feel that the amendment 1s not
to the advantage of high-level scientific re-
search.”

NEW HAMPSHIRE

James Brian Quinn, professor of business
administration, Dartmouth College: “I con-
sider the Long amendment to bills involving
scientific and technological development to
be one of the most dangerous and wasteful
proposals ever put forward in the field of
Government contracting. As a spectalist in
the administration of scientific and techni-
cal programs, I urge you to bring all possible
political pressure against this amendment.”

OHTO ‘

Melvin S. Newman, professor of organic
chemistry, the Ohio State University: “As
a@ person who has spent over 30 years in re-
search in universities as a staff member and
as a member of the National Academy of
Sciences, Organic Chemistry Division, I urge
that very careful attention be given to any
laws now being considered which threaten to
break down the present system of research
support and cooperation between members
of universities, industry and Government.”

PENNSYLVANIA

Charles C. Price, chairman, Department of
Chemistry, University of Pennsylvania: “The
Long amendment will greatly decrease the
progress of medical science in this country,
at least its availability for the benefit of the
public. I hope you will oppose this amend-
ment vigorously, in favor of a more judicious
and long-range study of the entire problem
of the relationship of the private and public
sectors of our scientific and technological
endeavors.”

Charles S. Cameron, president, Hahne-
mann Medical College and Hospital: “Surely
the Government’s and the public’s interests
can be safeguarded without the blanket pro-
vision of Mr. Lone’s amendment which, as
we see it, will not warm, but smother the
free association of scientific minds which is
the lifeblood of scientific discovery and tech-
nical progress.”

RHODE ISLAND

Barnaby C. Keeney, president, Brown Uni-
versity: “The proposed Long amendment has
been discussed here with people who have
spent many years studying the problems of
Federal support of research and education in
the life sciences. We recognize the complex-
ity of patent and copyright problems.

“I certainly endorse Dr. Donald Hornig’s
general approach to this amendment. The
amendment appears to be an oversimplified
approach to a complex problem.”

TENNESSEE

Grant W. Liddle, professor of medicine,
Vanderbilt University: “It would be a gen-
uine tragedy for all of us if, as a result of
legislation, the pharmaceutical industry,
which has uniaue contributions to make to

(2

medical research, were to be any less creative
vigorous, and enthusiastic than in the past
in joining their efforts with those of univer-
sity physicians in solving biomedical probl-
lems.”
TEXAS
Richard B. Turner, professor of chemistry,
Rice University: “First let me say that I
oppose the amendment. My present pur-
pose, however, is to urge in the strongest:
terms that action on the Long amendment’
be deferred until such time as the whole gen-.
eral question of patent policy can be made
the subject of detailed investigation, debate,
and public hearing.” : .
UTAH

D. M. Hammond, professor and head, de-
partment of zoology, Utah State University: .
“In my opinion this is an important prob-.
lem, action on which should be deferred
until consideration has been given to the
fundamental question of patent policies for
Government-supported research.

“In my opinion any hasty. legislative ac-
tion which might jeopardize the cooperative
relationship between university scientists
and industry would be highly unfortunate.’
Therefore, I am asking that this problem:
receive thorough consideration before any.
action is taken on the Long amendment.”

VIRGINIA

Randolph T. Major, University of Virginia:
“I am sure that ali would agree that the
Government should have an interest in the
results of the research it supports. But the -
Long amendment seems to me clearly unfair
to university and industrial scientists who
may collaborate with Government scientists
on research programs.”

‘ ‘WISCONSIN

Farrington Dantels, professor emeritus,
Solar Energy Laboratory, the University of
Wisconsin: “This problem of the ownership
of patentable ideas developed by scientists
receiving part of their support from Gov-
ernment funds is very complicated. Cer-
tainly the Government which supplies part
of the support of a research project is en-
titled to free use of any inventions which
may come from this research. On the other
hand, the progress toward public use of these
inventions may well be accelerated if patents
can be issued for commercial development.
The US. system of patents has been
‘uniquely successful in developing new man-
ufacturing projects and has resulted in an
extraordinary high standard of living. Some
of my friends are quite concerned that if
the Long amendment is adopted by Con-
gress, that the advances In the country’s
economics may suffer a setback because pri-
vate capital will not be so readily available
for carrying our development of new inven-
tions. I hope that you and your commit-
tee members will give careful thought to
the implications of this amendment.”

Mr. LONG of Louisiana and Mr. MIL-
LER addressed the Chair.

The PRESIDING OFFICER. Who
yields time?

Mr. LONG of Louisiana. Mr. Presi-
dent, how much time have I remaining?

The PRESIDING OFFICER. The
Senator from Louisiana has 6 minutes
remaining under his control.

Mr. LONG of Louisiana. Is there
more time available?

The PRESIDING OFFICER. All
time has expired except the 6 minutes
remaining under the control of the Sen~
ator from Louisiana.

Mr. LONG of Louisiana. Mr. Presi-
dent, I yield myself 2 minutes.

Mr. MILLER. Mr. President, will the
Senator vield?
14412 ,

_ LONG of Louisiana. I have only
_ 2 minutes.

Mr. President, it is obvious that efforts
are being made to make the universities
front for the drug companies. I under-
stand that. I have exposed on the floor
- of the Senate at least two individuals
who claimed to speak for universities
when they were actually speaking for
their drug companies, and when they
have been here speaking for associations,
they have been really speaking for
pharmaceutical monopolies. ot

I should like to point out that Dr. Fred
Cagle, of Tulane University, is the
chairman of research activities of the
American Council on Education. That
is the biggest of the associations. He
has said that the Council on Education
is being quoted as being opposed to the
Long amendment. That is completely
incorrect because the organization has
the same objectives as does the Senator
from Louisiana, that is, to make the
fruits of research freely available to the
public as quickly as possible.

Some of the letters to which the Sen-
ator from Alabama referred had to do
with my amendment to the higher edu-
cation bill and are not at all relevant
with regard to the question of Govern-
ment-sponsored research for health as
contained in the bill now before the
Senate.

It has been said that the Senator from
Louisiana stated that he knew of no mis-

going on. I pointed out one case in
ch there was a direct violation of the

Ww. In that case the research was done
in Government laboratories by Govern-
ment researchers. After I looked into
the case, the Merck Co. assigned the pat-
ent rights to the Government because
they knew it was against the law for
them to have those rights. But the
Government lost its rights to the foreign
patents as.a result of what the Merck
Co. did in that case.

T can point to another case to show
how Merck Co. has been using pressure
in order to find ways to get patents, in
violation of the law, on Government re-
search in the field of tranquilizers which
are used for mental health problems.
They try, often in violation of law, to get
hold of patents on Government research
even when the work is done by the Gov-
ernment’s own employees.

What protection have we when some
private concern gets its foot in the door
and can make a case for private patents
on Government research?

THE HASSLE OVER PATENTS

Mr. President, an interesting editorial
concerning the general issue debated in
the Senate earlier today was published
in the Washington Post on May 26, 1965,
entitled “Hassle Over Patents.”

I ask unanimous consent to have this
editorial printed in the Rrcorp.

There being no objection, the editorial
was ordered to be printed in the Recorp,
as follows:

Hassize Over PATENTS
e long smoldering dispute over the pat-
enting of discoveries made in the. course of
federally financed research and development
work has flared up again. Senator Lee Mrr-
caLF, in a speech on the floor of the Senate,

CONGRESSIONAL RECORD — SENATE

of “lobbying” on behalf of certain business
groups. These groups believe that the patent
rights to ideas developed with Federal funds
should be awarded to the contracting busi-
ness firm or nonprofit institution.
“Lobbying” is a pejorative, often imprecise
term, and there is little point in attempting
to plumb the Senator’s charges. But there
is much that should be said and done about
the failure of the Government to articulate
a clear policy in this troublesome area.
Some Federal agencies, notably the Atomic
Energy Commission, follow a clear and con-
sistent rule. Except in cases where the re-

search contractor already holds patents in

closely related areas, all patents issuing from
Federal contracts automatically revert to the
Government. But other agencies are per-
mitted by law to waive the patent claims of
the Government.

The battle now being waged, both in the
Congress and within the administration, is
over which policy shall prevail. Senator
Russet B, LONG insists that the patents
growing out of Federal contracts belong to
the public, and he has attached amendments
to several important bills which uphold that
principle. The patent law bar, industry
groups and many universities are ranged on
the other side. They contend that the pros-
pect of owning patent rights provides an im-
portant incentive to solve problems quickly.
And they raise the question of whether the
Government has the right to patents where
the contracting researcher draws upon, &
previously acquired expertise. .

In October 1963, the late President Ken-
nedy issued a patent memorandum which
purported to provide guidance for Govern-
ment agencies. But that document and the
Patent Advisory Panel subsequently formed
appear only to have confused matters, .

Patent policy issues can be complex, but
not so esoteric as spokesmen for the patent
bar claim when they chastise laymen for
speaking out. Whena private business enter-
prise contracts and pays for research and
development work, there is seldom if ever
any question about its right to the patents
that may emerge. The same principle should
apply in the case of Government-sponsored
‘esearch. There is no good reason why the
taxpayers should be expected to pay $15
pillion-a year for research and then turn
over to the adequately compensated con-
tractors exclusive patent rights.

To be sure, the rights of the owners of
“back-ground patents” should be protected
when they engage in Government contract
work. But aside from that exception, all
patents developed under Federal contracts
should revert to the Government, and the
Government in turn should make the pat-
ented knowledge freely available to all poten-
tial users. ,

Mr. LONG of Louisiana. I have out-
lined my arguments. I do not have much
more time to go into the issue. T should
like to offer my remaining time to the
senator from Oregon [Mr. Morse] and
the Senator from Michigan (Mr. Harr].

I yield 2 minutes to the Senator from
Oregon.

The PRESIDING OFFICER. The
Senator from Oregon is recognized for
2 minutes.

Mr. MORSE. Mr. President, as mem~
ber of the Committee on Labor and Pub-
lic Welfare, it is with reluctance that I
have come to the conclusion that the
amendment of the Senator from Louisi-
ana should be adopted. There is a ques-
tion of fact in the debate so far as I am
concerned that will determine my vote
on the issue, and that is whether or not
the evidence presented by the Senator

fone Taetntann and nthears annnoarts &

June 28, 1965

prima facie case to the end that various
commercial concerns, particularly drug
companies, will be unduly enriched by
a failure to adopt the amendment and
the financing of their research by the
taxpayers of the country. I think it
would be a mistake to.set a precedent
here today, when we have this great con-
troversy on patents, of seeming to ap-
prove of the undue enrichment of |
private concerns as a result of research ©
financed by the taxpayers. :

Furthermore, I well remember not so .
long ago the sound amendment of the.
Senator from Alabama to the tidelands
bill, which I supported, and which my
friend from Louisiana opposed, in which —
we urged then that royalties from the oil -
lands go to support education, Isuggest ©

that in connection with the payment for *

research by the taxpayers we have the :
right not to give away the benefits that
flow from that research to commercial .
concerns in this country. At least we |
should be insisting that the proceeds go
to some such worthwhile public purpose
as aid to education.

The PRESIDING OFFICER. The 2.
minutes yielded to the Senator from
Oregon. have expired.

Mr. MORSE. We have in this country
‘what amounts to a shakedown of the
American taxpayer by commercial con-

-egerns that wish to unduly enrich them-

selves at the expense of the public purse.
This is an example of it.

Mr. LONG of Louisiana. Mr. Presi-
dent, I yield 2 minutes to the Senator
from Michigan.

Mr. HART. Mr. President, one com-
ment that is frequently made of. the
Senate and the Congress is that there
are too many lawyers in it. I have never
heard the charge made that there are too
many patent lawyers. Indeed, I doubt
if there are any. This may explain in
part why there are few of us who are
comfortable. and assured in the treat-
ment and disposition of matters relating
to patent rights.

It is for this reason that I am delighted
that the able Senator from Arkansas
[Mr. McCrz.tian] is directing now an
overall analysis of the position which the
Federal Government should take with
respect to discoveries and patents result-
ing from Government-financed research.
This is the first such review in many,
many years; years during which the Fed-
eral Government has become a most im-
portant contributor to such research. In
the few years I have been permitted to
be a participant in the Senate business, I
have supported the. so-called Long:
amendment the several times it has been
offered to various bills. For the first
time I opposed this amendment when a
few weeks ago it was proposed to be
added to the NASA authorization bill.
Ié seems to me desirable that we await
the full record of the McClellan study
and seek to apply across the board a
prudent rule. On earlier votes, no such
study was underway. 1 would anticipate
taking a similar position on any other.
authorization or appropriation bills
which relate, as did the NASA bill, to re-
search which is related to commercial
products. But the Long amendment now
pending is to a bill which provides in
June 28, 1965

e@: for health research. For some 2
s under the leadership of the late
, and respected Senator Kefauver, I was
a member of the subcommittee which
heard much testimony on patents in the
field of medicine.

Even in this field I confess to a con-
tinuing uncertainty as to what the final
answer should be, but it is a field in
which I have heard extensive testimony
and much discussion. Indeed, I was
alone with the Senator from Tennessee
in supporting the proposition that the
general patent law should. be modified
as it relates to drug patents, that the ex-
clusive period should be reduced sub-
stantially, and that licenses be required
to be given by a patent holder to any
responsible firm on the payment of a
reasonable royalty after the period of
the reduced exclusive patent right had
run. SolI bring to this area of Govern~
ment research some rather established
opinions as to the course which best
serves the public welfare. I hope that
as the overall patent policy can be de-
veloped within the McClellan committee,
that I may persuade others in the com-
mittee to this point of view with respect
to research relating to health. I do not
know how long it will be before the effort
which began some weeks ago in the Mc-
Clellan committee reaches the point of
enactment of basic patent policy on the
statute books. This’ year. I would
doubt it. This Congress? One cannot
be certain. But the Senator from

kansas [Mr. McCriettan] can be

unted on to move the basic study as
objectively as possible. I. believe that
the Long amendment, which provides
flexibility, represents a prudent policy
for the transition period, however long
it may be, before we are in position to
make final determination with respect
to the legislation now pending in the
McClellan committee. It is just possible
that a cancer cure could “fall out” from
Government-financed research during
this, we hope, brief interim period. The
Long formula would be of real value
under such circumstances.
’ It.is for this reason, therefore, that I
shal support the Long amendment, it
relating to medicine and public health
oni not to commercial rockets or

The PRESIDING OFFICER. The
time of the Senator has expired.

Mr. HILL. Mr. President, I yield 2
minutes to the Senator from New York.

Mr. KENNEDY of New York. Mr.
President, I want to be on record regard-
ing this vote, because I want the Recorp
to reflect that in voting against the
amendment proposed by the Senator
from Louisiana, I am doing so for pro-
cedural reasons only.

I believe basically that the Govern-
ment should retain title to inventions
discovered through research that it has
financed. This is particularly true where
matters regarding health are concerned,
but I continue to be disturbed about the

rocedure of having to consider this mat-
r anew every time we are faced with
the authorization or appropriation for
a different Government agency. Sen-
ator McCLe.ian’s subcommittee is still
considerine this matter on a Govern-

CONGRESSIONAL RECORD — SENATE

ment-wise basis, and as I stated at the
time of the vote on the NASA authori-
zation bill, I believe that we should await
the results of that study.

If changes are to be made in the Gov~
ernment-wide patent policy, they should
be. made on a Government-wide basis
after full hearings and étudy. If Senator
McC ettan’s hearings do not produce an

overall policy that we can agree to, then

there would be more justification for
using the case-by-case approach of Sen-
ator Lone.

Our vote today does not bind us to
approving the actions and policies of
every President and every Secretary of
Health, Education, and Welfare and
every Surgeon General. And it is impor-
tant to note that the Senator from Loui-
siana stated on the Senate floor last Fri-
day that he does not disagree with the
present HEW patent policy. The amend-
ment, he said, simply codified: “what
HEW is.doing and what it thinks should
be done. I am not quarreling with that
agency. I am in support of the position
that it has followed.”

Thus, in the words of the Senator from
Louisiana himself, the problem is not in
the present, but rather. “the risk that
this program should become subject to
efforts of those who would exploit the
public interest and bring about a change
in that policy.”

The point is, therefore, that there is no
urgency on this matter. We do have
time, insofar as HEW is concerned, to
let Senator McCLeLuan complete his
study, so that we can evolve the present-
ly satisfactory policy of HEW into a leg-

islative policy that is appropriate for —

every agency of the Government. If by
next year or the year after we still have

no overall policy by legislation, and if it .

then appears that particular legislation

is needed for HEW or NASA or any other

agency, we can act then. Our action to-
day does not keep us from doing that.

My only point is that I do not believe
we should act on an agency-by-agency
basis until it is apparent that that is the
only way we will get action in this field.
There will be ample time for that kind
of approach when and if it becomes nec-~
essary. I shall, therefore, vote against
the amendment which the Senator from
Louisiana has proposed today.

Mr.MILLER. Mr. President, the Long
amendment should be defeated, and it
should be tabled,

This points up the same old issue
which the Senator from Louisiana and I
debated last January 28—page 1497 of
the Recorp of that date—at the time of
consideration of the water pollution
control bill.

I said then and I say now that it is un-
fair to turn over all patents and inven-
tions to the Federal Government without
regard to how much of the contractor's
own money and resources are involved—
just because some Federal money is in-
volved in a contract.

This is not an issue of turning over all
patent and invention rights to the Fed-
eral Government when the Government
puts up all of the money. It is an issue
of whether the contractor and the Fed-
eral Government should share equitably

(f

14413

in these rights when both put up some-
thing.

The amendment of the Senator from
Louisiana would turn over practically all

-patent rights to the Government when-

ever appropriated funds are expended
for any scientific or technological re-
search or development activity—regard-
less of how much the contractor puts up.
It is ene sided and unfair, and it will .
tend to retard inventiveness because the '
rewards therefrom will be lost by private
industry.

I ask unanimous consent that a tele-
gram in opposition to this. amendment
from the president of Iowa State Univer- ;
sity and a. letter in opposition to the °
amendment from the professor of or- ©
ganic chemistry of Iowa University be ™
printed at this point in the Rrecorp. 7

There being no objection, the telegram .
and letter were ordered to be printed in
the Recorp, as follows:

Ames, Iowa,
June 22, 1965. .
Senator JACK MILLER,
New Senate Office Building,
Washington, D.C.:

Iowa State University respectfully urges
your support in defeating Senator Lone’s at-
tempt to force his patent amendment on the
House-passed health research facilities bill,
H.R. 2984. Senator Lonc’s amendment would
seriously limit university research. :

Jamrs H. HILTON, .
President, Iowa State University.

Srare UNIversiry or Iowa,
. lowa City, Iowa, June 22, 1965.
Senator Jack. MILLER,
U.S. Senate,
Washington, D.C.

Dear Senator MruieR: This letter is being
written to give you my views on the Senator
Lone patent amendment to the House-passed
health research facilities bill, H.R. 2984.

We in the academic field working in medi-
cal chemistry are greatly dependent upon
drug firms for the screening of compounds
for physiological action. Passage of the Long .
amendment would prevent this arrangément
and seriously hinder research on the prepa-
ration of new drugs and impede scientific
progress which results from such collabora-
tion.

I hope that you will oppose this amend-
ment when it comes up before the Senate.
In so doing, you will aid the continuation of
the Nation's economic growth. :

Sincerely yours,
STANLEY WAWZONEK,
Professor, Organic Chemistry.

The PRESIDING OFFICER. All
time having expired, the question is on
agreeing to the amendment of the Sena-
tor from Louisiana [Mr. Lone], No. 298.
On this question the yeas and nays have
been ordered.

Mr. PASTORE. Mr. President——

The PRESIDING OFFICER. All time
has expired. .

Mr. PASTORE. Mr. President, I move
to lay amendment of the Senator from
Louisiana on the table.

Mr. MANSFIELD. Mr. President, will
the Senator withhold his motion? -

The PRESIDING OFFICER. Will
the Senator withhold his motion?

Mr. MILLER. Mr. President——

The PRESIDING OFFICER. Does the
Senator from Rhode Island withhold his
motion?

Mr. PASTORE. Mr. President, I move
-

14414

lay the amendment of the Senator
from Louisiana on the table.

The PRESIDING OFFICER. The
question is on the motion of the Senator
from Rhode Island to lay on the table the
amendment of the Senator from Louisi-
ana (Mr. Lone].

Mr. MILLER. Mr. President——

The PRESIDING OFFICER. The
question is-on agreeing to the motion of
the Senator from Rhode Island.

Mr. MORSE. Mr. President, I ask for
the yeas and nays.

_ The yeas and nays were ordered.

The PRESIDING OFFICER. The
question is on agreeing to the motion of
the Senator from Rhode Island to lay
on the table the amendment of the Sen-
ator from Louisiana [Mr. Lone]. On
this question the yeas arid nays have
been ordered, and the clerk will call the
roll.

The legislative clerk called the roll.

Mr. MANSFIELD (when his name was
ealled). I have a pair with the senior
Senator from Virginia [Mr. Byrp]. If
he were present and voting, he would
vote “yea.” If I were at liberty to vote,
I would vote “nay.” Therefore, I with-
hold my vote.

The roll call was concluded.

Mr. LONG of Louisiana. I announce -

that the Senator from Pennsylvania [Mr.
CrarK], the Senator from South Da-
kota [Mr. McGovern], the Senator from
Maryland (Mr. Typincs], are absent on

cial business.
I further announce that the Senator
from Virginia [Mr. Byrpl, is necessarily

absent.

On this vote, the Senator from Penn-
sylvania (Mr. CLarK] is paired with the
Senator from Wyoming [Mr. Simpson].
If present and voting, the Senator from
Pennsylvania would vote “nay” and the
Senator from Wyoming would vote
yea.

On this vote, the Senator from Mary-
land (Mr. Typrncs] is paired with the
Senator from New Hampshire [Mr. Cor-
ton]. If present and voting, the Sena-
tor from Maryland would vote “nay” and
the Senator from New Hampshire would
vote “yea.”

On this vote, the Senator from South
Dakota [Mr. McGovern] is paired with
the Senator from Nebraska (Mr. Hrus-
xa]. If present and voting, the Senator
from. South Dakota would vote ‘nay”
and the Senator from Nebraska would
vote “yea.” .

Mr. KUCHEL. I announce that the
Senator from Nebraska (Mr. Hruska]
and the Senator from New Hampshire
{Mr. Corron] are necessarily absent.

The Senator from North Dakota [Mr.
Younce] is absent on official business.

The Senator from Wyoming [Mr.
Simpson] is detained on official business.

On this vote, the Senator from New
Hampshire [Mr. Corton] is paired with
the Senator from Maryland [Mr.

Typines]. If present and voting, the

Qa from New Hampshire would

ote “yea” and the Senator from Mary-
land would vote “nay.”

On this vote, the Senator from Wyo-
ming (Mr. Suupson] is paired with the

ee es |

CONGRESSIONAL RECORD — SENATE

If present and voting, the Senator from
Wyoming would vote “yea” and the Sen-
ator from Pennsylvania would vote
“nay.”

On this vote, the Senator from Ne-
braska [Mr. Hrusxa] is paired with the

Senator from South Dakota [Mr. Mc-.

Govern]. If present and voting, the
Senator from Nebraska would vote “yea”
and the Senator from South Dakota
would vote “nay.”

The result was announced—yeag 55,
nays 36, as follows:

(No, 154 Leg.]
YEAS—55
Aiken Inouye Pastore
Allott Jackson Pearson
Bayh Javits Pell
Bennett Jordan, N.C. Prouty
Boggs Jordan, Idaho Robertson
Carlson Kennedy, Mass. Russell, S.C.
Case Kennedy, N.Y. Russell, Ga.
Cooper _ Euchet Saltonstall
Curtis Lausche Scott
Dirksen Magnuson Smith
Dominick McCarthy Sparkman
Eastland McClellan Stennis
Ervin Miller Symington
Fannin Mondale Thurmond
Fulbright Monroney Tower
Hayden Morton Willams, N.J.
Hickenlooper Mundt Williams, Del.
Ail Murphy
Holland Muskie
NAYS—236
Anderson Fong Montoya
Bartlett - Gore Morse
Bass Gruening Moss
Bible Harris Nelson
Brewster Hart Neuberger
Burdick Hartke Proxmire
Byrd, W. Va Long, Mo. Randolph
Cannon Long, La Ribicof
Church McGee Smathers
Dodd McIntyre Talmadge
Douglas McNamara Yarborough
Ellender Metcalf Young, Ohio
NOT VOTING—9 -
Byrd, Va. Hruska Simpson
Clark Mansfield Tydings
tion McGovern. Young, N. Dak.

So Mr. Pastore’s motion to lay on the
table the amendment of Mr. Lone of
Louisiana was agreed to.

Mr. HILL. Mr. President, I move to
reconsider the vote by which the motion
to lay the amendment on the table was
agreed to.

Mr. KUCHEL. Mr. President, I move
to lay that motion on the table.

The motion to lay on the table was
agreed to.

Mr. PASTORE. Mr. President, I
should like to explain why I made the
motion to lay on the table and why I
voted as I did.

I am doing it now because all time had
expired and I did not then have oppor-
tunity to express myself. I was unable
to do so before I made the motion.

If I were placed in the position of hav-
ing to vote on the merits of the amend-
ment, I should have voted in the affirma-
tive. I believe in the objective which

-the amendment seeks to accomplish. I

am for the consumer. I voted for the
natural gas bill. I voted to cut down the
oil depletion allowance. I believe in pro-
tecting the rights of the consumer. The
objective of this amendment is. to pro-
tect the rights of the consumer. But the
weight of opinion is that this is not the
time or place or procedure.

The Senator from Rhode Island was

nanenadad he tha arrumant mada hy tha

June 28, 1965

Senator from Alabama [Mr. Hi.) and
the Senator from Arkansas [Mr. Mc-
Cietian] that the matter needs exhaus-
tive study. It needs the considered judg-
ment based upon hearings by a proper
committee of the Senate. That com-
mittee is now engaged in hearings: on
this specific question.

For that reason, I made the motion to
lay the amendment on the table, merely
as a procedural matter, and not because

I.am opposed to the objective of the par-
_ticular amendment.

I should hope that the committee‘ of
Congress which is entrusted with this
very important problem would act ex-
peditiously so that we might achieve a
Settled national policy concerning the
protection of patent rights when Federal
money is used in these research pro-
grams.

Mr. JAVITS. Mr. President, I should
like to identify myself with the views of
the Senator from Rhode Island.

I feel exactly that way. I agree with
the Senator in every way.

Mr. DODD. Mr. President, I want to
take just a moment to note why I voted
against tabling the amendment of the
distinguished Senator from Louisiana.

Senator Lone has labored indefatiga-
bly for many years on patent policy
amendments he and a number of our
colleagues deem to best serve the public
interest.

I have disagreed with the wisdom of

some of these amendments because I be-

lieve that the traditional American pat-
ent policy of rewarding private inven-
tive energy and genius and protecting
its fruits has been the key to much of
the material greatness of our Nation.

At. the same time, I believe that the
health, even the life, of every. American,
indeed of every person in the world is
intimately connected with the achieve-
ments of modern medicine.

Therefore, I believe that medical dis-
coveries financed by. public funds present
a case significantly different from other.
scientific and mechanical developments
in the course of ooieranen-subsldiees
research.

Furthermore, whereas our traditional
patent policy has consistently encour-~
aged prolific invention, by requiring de-
velopment of alternative or improved de~ |
vices and ideas to circumvent existing
patents, we can have no such confidence
that we can develop or that we can await
the. development of alternative medi-
cines and devices to combat cancer,
heart disease, and the whole catalog
of ailments which plague mankind. :

And so I think that the only similarity
relevant to patent policy between Gov-
ernment-financed research in medicine
and in other fields is that all such re-
search involves public funds.

Thus, the objects of medical research,
their urgency, and their intimacy to
human welfare and survival may dictate
that different patent policies be applied
to publicly financed medical research
than are applied, for example, to de-
fense and space research.

Therefore, I voted against tabling Sen-
ator Lona’s amendment. I think it de-

carvad tha tact af a rallaall unta
ne 28, 1965

Mr. McGOVERN subsequently said:
Mr. President, earlier this afternoon I
inadvertently missed a rollcall vote on
the amendment of the Senator from
Louisiana {Mr. Lone], relative to. the
public’s interest in patents, stemming
from Government-financed medical re-
search.

I support the Long amendment and I
regret missing this important vote.

J was in the Senate dining room dur-
ing the entire rollcall conferring with
six university leaders who are support-
ing my bill, S. 1212, that seeks to give
our colleges and universities a more
effective role in the foreign assistance
program. We were deeply engrossed in
conservation. I simply did not hear the
rolicall bell. Furthermore, no member
of the Senate staff, nor of my own staff,
notified me that a rolleall was in prog-
ress. Iam sorry that a combination of
negligence on my part, and that of staff
personnel, led to my missing this im-
portant vote. : :

The PRESIDING OFFICER. The bill
is open to further amendment. If there
be no further amendment to be pro-
posed, the question is on the engross-
ment and third reading of thé bill.

The bill was ordered to be engrossed
for a third reading, was read the third
time and passed, as follows:

8. 596

act to amend the Public Health Serv-

ice Act to assist in combating heart disease,

cancer, and stroke, and other major
diseases.

Be it enacted by the Senate and House of
Representatives of the United States of
America in Congress assembled, That this
Act may be cited as the “Heart Disease, Can-
cer, and Stroke Amendments of 1965”.

Sec. 2. The Public Health Service Act (42
U.S.C., ch. 6A) is amended by adding at the
end thereof the following new title:
“TTTLE IK-—REGIONAL MEDICAL COMPLEXES FOR

RESEARCH AND TREATMENT IN HEART DISEASE,

CANCER, STROKE, AND OTHER MAJOR DISEASES

“Purposes

“Szgc. 900. The purposes of this title are—

“(a} Through grants, to encourage and as~
sist in the establishment of regionally coordi-
nated arrangements among medical schools,
research institutions, and hospitals for re-
search and training and for demonstrations
of patient care in the fields of heart disease,
cancer, stroke, and other major diseases;

“(b) To afford to the medical profession
and the medical institutions of the Nation,
through such coordinated arrangements, a
more abundant opportunity of making avail-
able to their patients the latest advances in
the diagnosis and treatment of these dis-
eases; and

“(c) To accomplish these ends without
interfering with the patterns, or the methods
of financing, of patient care or professional
practice, or with the administration of bos-
pitals.

“Authorization. of appropriations

“Sec. 901, (a) There are authorized to be
appropriated $50,000,000 for the fiscal year
ending June 30, 1966, $100,000,000 for the
fiscal year ending June 30, 1967, $200,000,000

or the fiscal year ending June 30, 1968, and
00,000,000 for the fiscal year ending June 30,

969, for grants to assist public or nonprofit
private universities, medical schools, research
institutions, hospitals, and other public or
nonprofit. private institutions and agencies,
or associations thereof, in planning, estab-

CONGRESSIONAL RECORD — SENATE

Ushing, and operating regional medical com-
plexes for research, training, and demon~-
stration activities for carrying out the pur-
poses of this title. Sums appropriated under
this section for any fiscal year shall remain
available for making such grants until the
end of the fiscal year following the fiscal year
for which the appropriation is made.

“(b) A grant under this title shall be far
part or all of the cost of the plenning and
other activities with respect to which the
application is made, except that any such
grant with respect to construction of, or pro-
vision of built-in (as determined in accord-
ance with regulations) equipment for, any
facility may not exceed 90 per centum of the
cost of such construction or equipment.

“(c) Funds appropriated pursuant to this
title shall not be available to pay the cost of
hospital, medical, or other care of patients
except to the extent it is, as determined in
accordance with regulations, incident to re-
search, training, or demonstration activities.

“Definitions

“Sec. 902. For the purpose of this title—

“(a) The term ‘regional medical complex’
means a group of public or nonprofit private
institutions or agencies engaged in research,
training, prevention, diagnosis, and treatment
relating to heart disease, cancer, or stroke
and, at the option of the applicant, any other
disease found by the Surgeon General to be
of major significance to the aforesald objec-
tives of such regional medical complex; but
only if such group—_—-

“(1) 1s situated within a geographic area,
composed of any part or parts of any one or
more States, which the Surgeon General de-
termines, in accordance with regulations, to
be appropriate for carrying out the purposes
of this title; ,

“(2) consists of one or more medical cen-
ters, one or more categorical research centers,
and one or more diagnostic and treatment
stations; and

“(3) has in effect ments for the
coordination of the activities of its compo-
nent units which the Surgeon General finds
will bé adequate for effectively carrying out
the purposes of this title.

“(b) The term ‘medical center’ means &
medical school or other medical institution
involved in post-graduate medical training
and one or more hospitals affiliated therewith
for teaching, research, and demonstration
purposes.

“(c) The term ‘categorical research center’
means an institution (or part of an institu-
tion) the primary function of which is re-
search (including clinical research), training
of specialists, and demonstrations and which,
in connection therewith, provides specialized,
high-quality diagnostic and treatment serv~
ices for inpatients and outpatients.

*(d) The term ‘diagnostic and treatment
station’ means a unit of a hospital or other
heaith facility, the primary function of
which is to support and augment local capa-
bility for providing specialized, high-quality
preventive, diagnostic, and treatment services
to outpatients and inpatients.

“(e) The term ‘nonprofit’ as applied to
any institution or agency means an institu-
tion. or agency which is owned and operated
by one or more nonprofit corporations or
associations no part of the net earnings of
which inures, or may lawfully inure, to the
benefit of any private shareholder or in-
dividual,

“(f) The term ‘construction includes alter-
ation, major repair (to the extent permitted
by regulations), remodeling, replacement,
and renovation of existing bulldings (includ-
ing initial equipment thereof), and replace-
ment of obsolete, bullt-in (as determined in
accordance with regulations) equipment of
existing buildings.

2O

“Grants for planning and development
“zc. 903. (a) The Surgeon General, upon

the recommendation of the National Advisory .

Council on Medical Complexes established by

section 905 (hereinafter in this title referred .

to gs the ‘Councii’), is authorized to make

grants to public or nonprofit private uni-.
versities, medical schools, research institu- |

tions, hospitals, and other public or non-

14415:

profit private agencies and institutions, or ©
associations thereof, to assist them fn plan-

ning the development of regional medical

complexes,

“(b) Grants under this section may be
made only upon application therefor ap-
proved by the Surgeon General. Any such

application may be approved only if it con- _
tains or is supported by reasonable assur-

ances that— :

“(1) Federal funds paid pursuant to any:

such grant will be used only for the purposes

for which paid and in accordance with the .
applicable. provisions of this title and the ©

regulations thereunder;

“(2) the applicant will provide for such °

fiscal control and fund accounting proce-
dures as are required by the Surgeon Gen-

eral to assure proper disbursement of and °

accounting for such Federal funds; .

“(3) the applicant will make such. reports,
in such form and containing such informa-
tion as the Surgeon General may from time
to time reasonably require, and will keep
such records and afford such access thereto
as the Surgeon General may find necessary
to assure the correctness and verification of
such reports; and

(4) the applicant will designate an ad-
yisory group, to advise the applicant (and
the resulting regional medical complex and
its component units) in formulating and
carrying out the plans for the establishment
and operation of such regional medical com-
plex, which includes representatives of orga-
nizations, institutions, and agencies con~
cerned with activities of the kind to be
carried on by the complex and members of
the: public familiar with the need for the
services provided by the comple,
“Grants for establishment and operation of

regional medical complexes .

“Sec. 904. (a) The Surgeon General, upon
the recommendations of the Council, is au-
thorized to make grants to public or non-
profit private universities, medical schools,
research institutions, hospitals, and other
public or nonprofit private agencies and
institutions, or associations thereof, to assist
in establishment and operation of regional
medical complexes, including construction
and equipment of facilities in connection
therewith. | mo

“(b) Grants under this section may be
made only upon application therefor ap-
proved by the Surgeon’ General. Any such
application may be approved only if it con-
tains or is supported by reasonable assur-
ances that— :

“(1) Federal funds paid pursuant to any
such grant (A) will be used only for the pur-
poses for which pald and in accordance with
the applicable provisions of this title and
the regulations thereunder, and (B) will
not supplant funds that are otherwise avail-
able for establishment or operation of the
regional medical complex with respect to
which the grant is made;

“(2) the applicant will provide for such
fiscal control and fund accounting proce-
dures as are required by the Surgeon Gen-
eral to assure proper disbursement of and
accounting for such Federal funds;

“(8) the applicant will make such reports,
in such form and containing such informa-
tion as the Surgeon General may from time
to time reasonably require, and will keep
such records and afford such access thereto
-

14416 CONGRESSIONAL RECORD — SENATE

© as the Surgeon General may find necessary

to assure the correctness and verification of
such reports;

“(4) the applicant has designated an ad-
visory group, described in paragraph (4) of
section 903(b), to advise in carrying out the
plan for the regional medical complex; and

“(5) any laborer or mechanic employed
by any contractor or subcontractor in the
performance of work on any construction
aided by payments pursuant to any grant
under this section will be paid wages at rates
not less than those prevailing on similar
construction in the locality as determined
by the Secretary of Labor in accordance with
the Davis-Bacon Act, as amended (40 U.S.C.
276a—276a-5); and the Secretary of Labor
shall have, with respect to the labor stand-
ards specified in this paragraph, the author-
ity and functions set forth in Reorganiza-
tion Plan Numbered 14 of 1950 (15 F.R. 3176;
5 U.S.C. 1882-15} and section 2 of the Act
of. June 18, 1934, as amended (40 U.S.C.
276¢) .

“National advisory council on medical
complexes

“Sec. 905. (a) There is hereby established
in the Public Health Service a National Ad-
visory Council on Medical Complexes. The
Council shall consist of the Surgeon General,
who shall be the Chairman, and the Chief
Medical Director of the Veterans’ Adminis-
tration, ex officio, and twelve members, not
otherwise in the employ of the United States,
appointed by the Surgeon General, with the
approval of the Secretary and without re-
gard to the civil service laws, who are lead-
ers in the fields of the fundamental sciences,
the medical sciences, hospital administra-
tion, or public affairs. At least one of the
appointed members shall be outstanding in
the study, diagnosis, or treatment of heart
disease, one shall be outstanding in the
study, diagnosis, or treatment of cancer, and
one shall be outstanding in the study, diag-
nosis, or treatment of stroke.

“(b) Bach appointed member of the Coun-
cil shall hold office for a term of four years,
except that any member appointed to fill a
vacancy prior to the expiration of the term
fonwhich his predecessor was appointed shall
be appointed for the remainder of such term,
and except. that. the terms of office of the
members first taking office shall expire, as
designated by the Surgeon General at the
time of appointment, four at the end of the
first year, four at the end of the second year,
and four at the end of the third year after
the date of appointment. An appointed
member shall not be eligible to serve con-
tinuously for more than two terms. '

“(c) Appointed members of the Council,
while attending meetings or conferences
thereof or-otherwise serving on business of
the Council, shall be entitled to receive com-
pensation at rates fixed by the Secretary, but
not exceeding $100 per day, including travel
time, and while so serving away from their
homes or regular places of business they may
be ‘allowed travel expenses, including per
diem in Heu of subsistence, as authorized by
section 5 of the Administrative Expenses Act
of 1946 (5 U.S.C. 73b-2) for persons in the
Government service employed intermit-
tently.

“(dj The Council shall advise and assist
the Surgeon General in the preparation of
regulations for, and as to policy matters
arising with respect to, the administration
of this title, The Council shall consider all
applications for grants under this title and
shall make recommendations to the Surgeon
General with respect to approval of applica-
tions for and the amounts of grants under
this title; amd such recommendations shall
also be transmitted to any advisory council
or committee, established by or pursuant to
this Act, which the Surgeon General deems

ae

“Regulations

“zc. 906. The Surgeon General, after con-
sultation with the Council, shall prescribe
general regulations covering the terms and
conditions for approving applications for
grants under this title and the coordination
of programs assisted under this title with
programs for training, research, and demon-
strations relating to the same diseases as-
sisted or authorized under other titles of this
Act or other Acts of Congress.

“Report

“Sec. 907. On or before June 30, 1967, the
Surgeon General, after consultation with the
Council, shall submit to the Secretary for
transmission to the President and then to
the Congress, a report of the activities under
this title together with (1) a statement of
the relationship between Federal financing
and financing from other sources of the ac-
tivities undertaken pursuant to this title,
(2) an appraisal of the activities assisted un-
der this title in the light of their effective-
ness in carrying out the purposes of this
title, and (3) recommendations with respect
to extension or modification of this title in
the light thereof.”

Sec. 3. (a) Section 1 of the Public Health
Service Act is amended to read as follows:

“Secrion 1. Titles I to CX, inclusive, of this
Act may be cited as the ‘Public Health Serv-
ice Act’.”

(b) The Act of July 1, 1944 (58 Stat. 682),
as amended, is further amended by renum-
bering title IX (as in effect prior to the on-
actment of this Act) as title X, and by re-
numbering sections 901 through 914 (as in
effect prior to the enactment of this Act),
and references thereto, as sections 1001
through 1014, respectively.

Mr. MANSFIELD. Mr. President, I
move to reconsider the vote by which the
bill was passed,

Mr. HILL. Mr. President, I move to
lay that motion on the table.

The motion to lay on the table was
agreed to.

 

—F,

June 28, 1965