Lutnik Pushes to Tap University Patent Fortunes for Federal Revenues

The U.S. government, under the Trump administration, is contemplating a scheme to accrue a portion of the revenue generated from patents developed at major universities utilizing federal funds. This information comes to us from a recent interview with Commerce Secretary Howard Lutnick on The Axios Show.

Secretary Lutnick, when asked about potential deals that might yield the U.S. a share of profits, stated, “I think universities, who are getting all this money. The scientists get the patents, the universities get the patents, and the funder of $50 billion, the U.S. government, you know what we get? Zero.”

In addition to this, the commerce secretary proposed that if the government invests in the research, and a patent is subsequently developed, half the benefits should fall to the U.S. taxpayer. This, he believes, will help fund our Social Security system and reduce the deficits.

The Bayh-Dole Act of 1980 allows universities to retain ownership of patents achieved with federal funding. The intention was to provide a clearer path for universities to do research profitably, encouraging them to be more aggressive in developing new medicines and technologies.

However, not all universities stand to benefit equally from this arrangement. According to a 2024 study, many universities would profit more from writing grants than from commercializing patents, due to the costs and challenges involved.

Secretary Lutnick has already demanded a comprehensive list of all patents stemming from federally funded research grants from Harvard. He also plans to approach the University of California system. He asserts that it will start with a few universities and then a more comprehensive agreement will follow.

Despite these proposed changes, Lutnick insists that he isn’t suggesting ending university efforts to commercialize patents — only that the government should receive half of the benefits they generate. As he put it, “America should participate. How do we not get our money back? That’s insane.”

The commerce secretary’s suggestion raises important questions about the funding and commercialization of research, the role of universities, and the distribution of the benefits derived from federally funded patents.