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Manufacturers Balance Regulation and Innovation

Photo by Moe Thajib on behalf of Axios

Manufacturers are making enormous strides to create innovative products and systems, but unbalanced regulations can slow development and hinder innovation. At an event jointly hosted by Axios and the NAM, titled “Balancing Innovation vs. Regulation,”  NAM President and CEO Jay Timmons spoke about exciting technologies, tough regulatory barriers and the impact on consumers.

Seeing the future: Timmons spoke about the wide range of areas in which manufacturers are innovating, from new technologies used in transportation systems, to cutting-edge techniques for agriculture, to groundbreaking medicines that improve and save lives.

  • “I have the best job in the world, because I get to see all these new innovations,” said Timmons. “I can actually get to see the future as it’s being created.”

A big opportunity: Timmons talked about how digitization and AI are transforming the way manufacturers operate, allowing them to innovate more quickly and effectively. Using biopharmaceuticals as an example, he talked about how AI has been able to help speed up the drug discovery and development process by making sense of complex information quickly in order to achieve results.

A looming concern: Timmons highlighted the dangers of the Biden administration’s “march-in” guidance —a proposal that would enable the federal government to “march in” and seize the patent rights for any product that was developed, even in part, with federal funding. Under the proposal, the government’s decision to march in could be based on the price of a product—setting the stage for government price controls on life-changing and lifesaving products.

The impact: According to Timmons, the threat of the government “marching in” to seize manufacturers’ intellectual property rights will impact the development and commercialization of innovative products and undermine every sector of America’s world-leading innovation economy. Clean energy solutions, next-generation semiconductors, advanced batteries, lifesaving medicines and more could be at risk.

  • “If they came in and said, ‘Look, we’re going to take away that intellectual property, take away your ability to actually pay for what you put into this process,’ what kind of incentive is that to make things here in America?” said Timmons.

The political scene: Timmons was joined on stage by Reps. Jake Auchincloss (D-MA) and Bryan Steil (R-WI), who echoed his concerns about the administration’s plan to undermine manufacturers’ IP.

  • “The Massachusetts economy really was built on tech transfer from our universities and academic medical centers,” said Rep. Auchincloss. “It is this wonderful synergy between the universities and entrepreneurs. And anything that would undermine the confidence of investors to do tech transfer from those universities, which potential march-in under Bayh-Dole would, is concerning for me.”
  • “Anytime you have the federal government come in and set price controls … rarely do you actually drop price; what you really do is drop development,” said Rep. Steil. “You bring prices down by driving competition into the market, not by setting price controls.”
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