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Pursuant to a legislative requirement, the GAO reviewed the effectiveness of royalty-sharing programs established under the Federal Technology Transfer Act of 1986, focusing on: (1) federal scientists' interest in reporting inventions before and after the Act's passage; and (2) the extent to which agencies' program implementation supports royalty-sharing incentives.
The GAO found that: (1) royalty-sharing programs at federal laboratories had little impact on scientists' interest in patenting inventions; (2) 14 of 21 agencies showed no improvement in the rate of patenting after the Act's passage; (3) the small licensing rate increase provided no incentive to scientists to patent inventions; (4) most inventors received an average of $1,000 in shared royalties; (5) many scientists preferred peer recognition to monetary rewards; and (6) many scientists chose federal employment because it offered more freedom, creativity, and longer time frames for research than private-sector employment.
GAO also found that: (1) agencies typically used formulas that gave inventors a small percentage of royalties; (2) many scientists did not know of the royalty-sharing programs, and believed that conflict-of-interest policies would hamper collaboration with industry; (3) many agencies did not capitalize on their inventors' successes to publicize their royalty-sharing programs; (4) agencies did not have adequate systems to ensure that inventors timely received royalty payments; (5) some agencies used the laboratory-share of royalties to pay administrative costs, rather than enhance laboratory research or personnel development; and (6) patenting delayed publication of research results, which was important to scientists' professional recognition.