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259  National Research and Development Foundation

     A National Research and Development Foundation, which would own
and exploit the patent rights to inventions made in universities with
federal grants money, but at an arm's length from the universities
themselves, has been suggested by Professor Joshua Lederberg, president
of Rockefeller University in New York.  The suggestion has been
made in a letter from Professor Lederberg, Nobel-Prize-winner and
until last month professor of genetics at Stanford University's School
of Medicine, in a letter to Senator Gaylord Nelson, whose select
committee on small business is currently holding hearings into federal
patent policy.

     In his letter Professor Lederberg says that he does not believe
the pursuit of proprietary gains to be the proper business of the staff
of a university.

     "The possibility of profit--especially when other funding is so
tight--will be a distorting influence on open communication and on the
pursuit of basic scholarship" he said.

     Professor Lederberg continues: "On the other hand, the need to
protect development investment for the exploitation of inventions is
absolutely sound, and essential to the nation's economy.  Such in-  
vestments are typically much larger than the costs of the original
research, and are comparable to the expected `profits'--when there is
a pay-off.

     "It should not be so difficult to reconcile these objectives,
using the Research Corporation as a model.  Set up an accountable,
not-for-profit national R&D foundation, and vest all government-owned
patents in it.

     "NRDF will then enter the market, at arm's length, with licences
etc. for the inventions it owns.  The fees should first of all cover
its operating expenses.  Then it can use its profits and accumulated
reserves to fund grants and contracts that will continue to further
the practical applications of scientific discovery."

     Professor Lederberg says that universities should not share in the
licence fees except to the extent of their cost-sharing in the
research that led to the invention, which would be assumed to be 10
per cent for routine cases.

     Furthermore individuals should not, in principle, be rewarded for
the results of work for which they were already receiving an academic
salary, although neither should they be hindered in private arrangements,
for the fruits of time and energy for which they were not on
salary, and which are outside their normal academic duties.

     "The financial and regulatory stresses on our private institutions
are threatening their future existence.  But patent-seeking is an
inappropriate answer to these financial dilemmas," Professor Lederberg
says.
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