By Matthew Chun
Business is bustling for biotechnology and biomanufacturing. On September 12, 2022, President Biden signed an executive order, launching a “whole-of-government approach to advance biotechnology and biomanufacturing.” And two days later, he backed it up with a national summit and a $2 billion spending plan.
But who stands to benefit from this large commitment of federal money? We all do.
Whether you care about health, climate change, energy, food security, agriculture, supply chain resilience, education, or national and economic security, Biden’s new initiative has a little bit in it for everyone. The initiative takes an expansive view of the roles of biotechnology and biomanufacturing in the United States economy, recognizing the importance of foundational scientific capabilities to a wide range of societal goals.
Among other things, the executive order sets forth an agenda that includes assessing the state of, and taking steps to bolster, core competencies of the nation including:
- Biotechnology and biomanufacturing research and development (R&D)
- Bio-related data set development and management
- Biomanufacturing capacity
- Biobased products procurement
- Workforce training and education
- Biotechnology regulation
- Biosafety and risk management
- Statistical analysis of the bioeconomy
- Threat assessment to the U.S. bioeconomy
- International engagement
Where the Money will Go
Using his executive spending discretion, President Biden committed $2 billion of federal funds to implement the new initiative. And true to the stated “whole-of-government approach,” the money will be invested through several different agencies, including:
- The Department of Health and Human Services: Investing $40 million to “to expand the role of biomanufacturing for active pharmaceutical ingredients (APIs), antibiotics, and the key starting materials needed to produce essential medications and respond to pandemics.”
- The Department of Defense: Investing $1 billion over five years in bioindustrial domestic manufacturing infrastructure, $270 million over five years to translate research into products and “to support the advanced development of bio-based materials for defense supply chains,” and $200 million in biosecurity and cybersecurity.
- The Department of Agriculture: Investing $500 million “to support independent, innovative, and sustainable American fertilizer production to supply American farmers” with the help of biotechnology and biomanufacturing advances.
- The Department of Energy: Investing $100 million for R&D for conversion of biomass to fuels and chemicals, $60 million “to de-risk the scale up of biotechnology and biomanufacturing that will lead to commercialization of biorefineries,” and $20 million for a “bioassurance program” to advance biosecurity.
- The Department of Commerce: Investing $14 million next year on “biotechnology research programs to develop measurement technologies, standards, and data for the U.S. bioeconomy.”
Why We All Win
With all of this taxpayer money being spent on biotechnology and biomanufacturing, it is fair to question whether we, as individual citizens, will ever reap the benefits. Moreover, why should the U.S. government prop up these industries with federal funding rather than simply letting private investment do its thing?
There are at least three reasons we should expect to benefit from Biden’s bet on the bioeconomy and be glad that the government is stepping in.
First, government action is needed to fill the funding gap for basic research in the United States.
Research from the National Center for Science and Engineering Statistics has shown that while the U.S. business sector funds 85% of experimental development and 54% of applied research, it only funds a mere 29% of basic research. Presumably, this is because the expected returns from basic research are too far out in the future and the risks too high for private investors to bear. However, basic research is necessary for long-term innovation and competitiveness of the American economy, especially in technologically complex sectors such as biotechnology and biomanufacturing. Therefore, government, educational institutions, and nonprofits play a crucial role in filling the funding gap. And Biden’s funding of R&D and the basic infrastructure for the U.S. bioeconomy is aimed to do just this.
Second, federal funding for new biotechnologies will make them more accessible to the public.
Biden’s initiative could potentially prevent life-saving innovations from falling under total monopoly control of the private companies that develop and patent them. Under the Bayh-Dole Act, codified in 35 U.S.C. Chapter 18, any inventions patented by a nonprofit organization or business firm (small or large) that resulted from federal funding are subject to “a nonexclusive, nontransferrable, irrevocable, paid-up license to practice or have practiced for or on behalf of the United States.” Further, in particular scenarios, 35 U.S.C. § 203 also grants march-in rights, which allow the government “to grant a nonexclusive, partially exclusive, or exclusive license in any field of use to a responsible applicant or applicants, upon terms that are reasonable under the circumstances,” even if the patentee refuses.
While march-in rights have never been used by the government before, the COVID-19 pandemic has raised the possibility of exercising such rights to improve equitable access to life-saving drugs. And, as we become increasingly reliant on novel biotechnologies, it would not be unexpected to run into similar issues again. Federal funding of key technologies in the bioeconomy can thus serve as an important safeguard for the future public interest.
Third, we can expect positive externalities from this initiative that are not even imaginable right now.
Another reason to love Biden’s initiative is that it will likely have positive externalities that we cannot even foresee right now. Analogizing to the Space Race, President John F. Kennedy’s bold commitment to the U.S. space program yielded benefits well beyond getting men to the moon. According to NASA, over 2,000 spinoff technologies have come out of NASA research, including medical imaging techniques, water filtration systems, and even memory foam. If all goes well, Biden’s similarly ambitious bet on the bioeconomy has the potential to yield comparably wide-reaching results.
In summary, there are reasons for everyone to be excited about Biden’s commitment to biotechnology and biomanufacturing. However, whether or not the initiative actually lives up to its promise — only time will tell.