Don't Clutch Your Pearls Yet
Taxpayer-Funded Chinese Inventors #2
On August 29, Reuters published an article about Chinese national researchers being the beneficiaries of US taxpayer R&D funding. The article "Exclusive: US government funding yielded hundreds of patents for China-based researchers" reports that over 1,000 patents with at least one Chinese researcher received at least one taxpayer-funded R&D grant or contract. The source for the article was a report prepared by the USPTO for the House of Select Committee on China. The article states that USPTO’s report shows that "the agency granted 1,020 patents from 2010 through the first quarter of 2024 that were both funded at least in part by the U.S. government and involved at least one China-residing inventor."
FedInvent looked at its portfolio of taxpayer-funded patents for the same period. We dug out all the patents granted between 2010 and Q1 2024 that matched the criteria in the Reuters article — patents with Chinese inventors and taxpayer funding. We included patents with a government interest statement as required by the Bayh-Dole Act or patents assigned to (owned by) a federal government entity.
On September 18th, we published our newsletter with the first part of the FedInvent analysis of US Taxpayer-Funded Patents with Chinese Inventors. Part 1 is focused on the numbers—who funded the projects with Chinese inventors, how many contracts and grants were covered, how many Chinese inventors were cited on the patents, and what entities own the patents. Part 2, presented here, explains the complexity of the federal innovation ecosphere in light of Chinese inventors, complex research programs and the reality of global R&D collaboration. We finish with our observations, policy suggestions and some data improvements that will help policymakers and lawmakers understand the issues surrounding Chinese inventors and federally-funded R&D.
Read The Newsletters or The Full Report
We compiled our analysis into a report called US Taxpayer-Funded Chinese Inventors, A FedInvent Analysis. The content is too long for a single newsletter. We are publishing two newsletters containing our key findings.
For those of you who would like to see the whole report compiled into a single document, you can download the PDF version here.
The Second Military Medical University
A Chinese Military University, an NIH Patent, and an American Inventor
Reuters reported that the patents on the list it reviewed "were both funded at least in part by the U.S. government and involved at least one China-residing inventor." The list Reuters reviewed is unlikely to include patent 9181193 ('193) This patent is assigned to the Second Military Medical University, but GAO says NIH owns it. One of the inventors is a research scientist from the National Cancer Institute (NCI) at NIH. It’s complicated.
This patent isn’t findable using the standard federally funded patent searching tactics. This patent showed up on the GAO report of patents owned by HHS, but it wasn’t in the FedInvent Portfolio. How did we miss it? A deeper look ensued.
The patent is in a data file released in a GAO Report titled "Biomedical Research: NIH Should Publicly Report More Information about the Licensing of Its Intellectual Property" (GAO-21-52). GAO report identified 4,446 U.S. patents owned by the Department of Health and Human Services (HHS). These patents cover patents granted from 1980 through 2019. Among the patents on the GAO list was US patent 9181193.
The '193 patent, titled "Indenoquinolone Compound, Preparation Method And Use Thereof," is assigned to the Second Military Medical University. It has no government interest statement and no US government agency as an assignee. Other than this patent’s appearance on the GAO report, there is no indication of any US ownership of the patent, so we looked further.
The Second Military Medical University is the assignee on the patent. The university’s full name is People's Liberation Army Second Military Medical University. Before these names, the university was called the People's Medical College of the East China Military Commanding Region.
The patent’s inventors are:
0001 Yunlong Song - Shanghai (CN)
0002 Xiaodan Fu - Shanghai (CN)
0003 Yunpeng Qi - Shanghai (CN)
0004 Yves G. Pommier - Bethesda, MD (US)
Inventors from Bethesda, MD, are a clue to a potential link to the NIH. Dr. Pommier, M.D., Ph.D., is a prolific inventor from the National Cancer Institute at NIH. His most recent bio on the NIH website says he is the Chief of the Developmental Therapeutics Branch and a Senior Investigator in the Molecular Pharmacology Group. Dr. Pommier is also an Honorary Professor of the Shanghai Institute Materia Medica, and the Chinese Academy of Sciences.
What’s not clear here is whether the Second Military Medical University was funded by a US contract or grant, or whether the taxpayer contribution was Dr. Pommier’s participation in research that led to the invention. It’s also possible Dr. Pommier was a visiting researcher at the Second Military Medical University at the time the researchers made the discovery that led to the invention or if Dr. Pommier consulted with the Chinese scientists from his lab in Bethesda, MD.
What is clear that this patent has no indication other than Dr. Pommier’s name to indicate that HHS considers it part of the NIH portfolio. The only reason we found it is because the FedInvent team is constantly looking for resources from the federal government that will confirm the contents of our FedInvent portfolio.
The Visitors
Hidden Taxpayer-Funded Chinese Inventors
Congress may view the 1,084 patents with Chinese inventors who received taxpayer funding as problematic, but other Chinese nationals benefit from US taxpayer funding. Consider the case of the Visitors—the Visiting Scientist, the Visiting Researcher, the Visiting Professor, or the Visiting Guest Investigator—from China. Patents where visiting scientists are the inventors frequently reflect where the Visitor resided when the patent application was filed.
Science is a collaborative business. Consider NIH. Its international research page says, "Annually, more than 2,000 scientists from other nations conduct research in the basic and clinical science laboratories on the NIH campus in Bethesda, Maryland, and in several field units around the country." Other federal departments have similar collaborative research programs where international researchers come here, and US researchers go overseas.
FedInvent doesn’t spend a lot of time digging around into the affiliations of the inventors on taxpayer-funded patents unless there’s a reason to look — unfindable contract numbers, work by intramural researchers, or cool invention worth investigating. We do spend a lot of time trying to figure out the poor-quality contract numbers that appear on patents funded by the taxpayer. This takes us down the rabbit hole to academic publications written by the inventors to see if their academic publications have better or at least findable contract numbers. This process leads you to an inventor/author’s biography.
For example, an inventor who cites their residence as Lafayette, IN (US), has an unfindable grant number on a patent. FedInvent hunts down the inventor to try to resolve the contract number and the source of the taxpayer funding. The search reveals that the inventor was a visiting scientist at Purdue University from a Chinese university. By the time the application is filed or the patent is granted, the inventor is back in China teaching at their home university.
Here is an example: Patent 11569826 shows Xiyuan Tang, Austin, Texas (US) as an inventor. When the patent application was filed on February 16, 2021, Dr. Tang was already back in China. Dr. Tang’s public bio reads:
Xiyuan Tang is currently an assistant professor at Peking University. Xiyuan received the B.Sc. degree (Hons.) from the School of Microelectronics, Shanghai Jiao Tong University, Shanghai, China, in 2012, and the M.S. and Ph.D. degree in electrical engineering from The University of Texas at Austin, Austin, TX, USA, in 2014 and 2019 respectively. From 2014 to 2017, he was a Design Engineer with Silicon Laboratories, Austin, TX, where he was involved in the RF receiver design.
Dr. Tang does not appear as a Chinese inventor on the patent. The patent cites three grants in the government interest statement — GR 10004941 (NSF), GR 10025282 (ONR), and GR 00001093 (AFOSR). All three are unfindable. We couldn’t find the grants but we did find a visiting Chinese scientist.
Don’t Clutch Your Pearls Yet
The mere presence of Chinese inventors on tax-payer funded patents doesn’t mean a national security crisis is imminent or that federal program managers responsible for the research grants were duped. The intellectual property situation here gets very complicated. Consider these two situations.
Pearl Clutch #1
Projects Jointly Funded by the US and China
US Patents 9239453 ('453) titled "Optical See-through Free-form Head-mounted Display", and 9244277 ('277) titled "Wide Angle And High Resolution Tiled Head-mounted Display Device", are both jointly owned by the Beijing Institute of Technology and the University of Arizona. Both patents were granted in 2016.
The government interest statement for the '453 patent quoted below shows that the project was funded by a 2006 grant from the US National Science Foundation The inventors also received funding from the National Natural Science Foundation of China, and Hi-Tech Research and Development Program of China:
GOVERNMENT RIGHTS (1) This invention was made with government supports under contract numbers 0644446 awarded by the U.S. National Science Foundation, 60827003 awarded by the National Natural Science Foundation of China, and 2009AA01Z308 awarded by the Hi-Tech Research and Development Program of China. The U.S. and Chinese governments have certain rights in the invention.
The '277 patent only cites the US NSF grant in the government interest statement. The rest of the funding shows up in the Background of the Invention section of the patent. A quick look at the government interest statement would lead you to think only the US government funded this patent. A deeper read shows that the patent was also funded by Chinese research entities.
The first named inventor on these two patents is Dewen Cheng of Beijing, China. The second named inventor and the principal investigator on the US NSF grant is Dr. Hong Hua . Dr. Hua is an expert in 3D display technologies, complex visualization systems, image acquisition technologies, and optical engineering. Dr. Hua received her PhD in Optical Engineering from the Beijing Institute of Technology in China in 1999.
Who Called Who? Did Dr. Cheng call Dr. Hua and say let’s work together because he had Chinese R&D funding but needed expertise? Did Dr. Hua receive funding from NSF and contact her former colleague?
Dr. Hua is the principal investigator on the NSF grant which means she developed the research proposal funded by NSF. The grant makes no mention of Chinese collaborators. On the other hand, was the University of Arizona the beneficiary of Chinese government funding? Or is this as simple as the patent attorney sending the inventors an email that said, "Send me all the information on R&D funding any of you received from the government so I can finish the patent application."
The NSF grant abstract cites an interesting goal of the research:
"Particularly, the PI will evaluate the effectiveness of the proposed technology using scenarios directly related to scientific activities underway by researchers in NASA's Mars Exploration Program."
So what did they inventors invent? The Background of the Invention section of the patent says, "Optical see-through head-mounted displays (OST-HMD) find myriads of applications from scientific visualization to defense applications, from medical visualization to engineering processes, and from training to entertainment. In mixed or augmented reality systems, OST-HMDs have been one of the basic vehicles for combining computer-generated virtual scene with the views of a real-world scene." Technology for an augmented reality headset.
Meanwhile, the federal government has invested significant funding on research to develop a range of augmented reality applications. Among the notable acquisitions of augmented reality equipment was the Army’s purchase of 120,000 augmented reality headsets from Microsoft in a contract worth $21.88 billion over ten years. The Army’s Integrated Visual Augmented System or IVAS program began in 2018 with a $480 million investment.
Understanding the national security risks, and the impact on American Competitiveness are legitimate areas of inquiry here.
Pearl Clutch #2
A Bigger Picture
From 2005 through Q1 2024, the Department of Energy funded 337 contracts that led to 229 patents with Chinese inventors. Forty-eight, or 21%, of these DOE-funded inventions with Chinese inventors went to a single entity, Novozymes, Inc. The majority of these 48 patents have only Chinese inventors.
Novozymes A/S was a global biotechnology company headquartered in Bagsværd, outside of Copenhagen, Denmark. The company's focus was the research, development and production of industrial enzymes, microorganisms, and biopharmaceutical ingredients. The company merged with Chr. Hansen to form Novonesis in January 2024.
The Department of Energy National Renewable Energy Lab funded Novozymes’ Project DECREASE: Development of a Commercial-Ready Enzyme Application System for Ethanol (DECREASE). A highly non-technical explanation of the project’s goal was to deliver an effective enzyme cocktail for converting biomass to sugars, enabling reduced costs for producing advanced biofuels such as cellulosic ethanol.
The contract, DE-FC36-08GO18080, was a cooperative research and development agreement under which Novozymes agreed to match DOE funding dollar for dollar.
The project team for this engagement was:
Novozymes, Inc (Davis, CA, USA)
Novozymes, A/S (Bagsvaerd, Denmark)
Novozymes Investment, China (Beijing, China)
Pacific Northwest National Laboratory (Richland, WA, USA)
Université de la Méditerranée and Universite de Provence (France)
Cornell University (Ithaca, NY, USA)
The participation of a Chinese entity was known to DOE when the contract was awarded.
The 48 patents with Chinese inventors represent only 29% of the 165 patents that cite funding under the DE-FC36-08GO18080 contract. One hundred sixty five patents from a single contract is impressive. According to USASPENDING.GOV, the contract was awarded on August 30, 2008, and completed on September 30, 2011. The last patent citing this contract, 11713476, was awarded in 2023, 15 years after the contract was awarded. Of the 165 patents granted to Novozymes, 70 patents had Danish inventors, and 40 patents with no Chinese inventors had no American inventors either.
While Pacific Northwest National Laboratory (PNNL) was a participant in the project, so far, we haven’t found any PNNL personnel listed on any of the Novozymes patents.
The US doesn’t have expansive national security issues with Denmark other than the pesky problem of discouraging ASML, the largest supplier for the semiconductor industry and the sole supplier in the world of extreme ultraviolet lithography (EUV) photolithography machines that are required to manufacture the most advanced chips, not to sell their equipment to China.
So here's a three-year DOE contract awarded to the US division of a Danish company, which resulted in 165 patents being granted over 15 years.
The FedInvent View
On Chinese Inventors and Taxpayer-Funding
Here are some thoughts on Chinese national researchers and inventors receiving US taxpayer funding: observations, policy suggestions, and, finally, patent data improvements.
Observations
One crucial takeaway from the 1,084 patents with Chinese inventors that FedInvent analyzed was that Chinese inventors are working on projects across the US and receiving funding from the US’s most consequential R&D programs.
The projects that Chinese inventors worked on cover a broad spectrum of America’s top ten science and technology priorities to maintain US global innovation leadership. They also cover China’s seven "frontier technologies."
While this analysis is a start, there is no practical way to determine the nationality of inventors on US patents or the number of US inventors who are women or veterans. Congress and policymakers need more data to analyze who is obtaining US patents.
Policy Suggestions
Congress needs to clarify the rules about who can work on taxpayer-funded R&D and create a more effective way to determine inventors' nationality. Residence is fluid, but nationality and citizenship aren’t. Researchers move around. The internet has enabled global collaborations between scientists and investigators. There are plenty of instances where US inventors responsible for seminal inventions funded by the federal government move around the US as they collaborate with different groups of scientists.
The House Select Committee on China should focus its attention on how to limit the types of research Chinese foreign nationals can engage in and the access of Chinese researchers have to national security-focused research facilities. The current documentation on government contracts that lead to discoveries that lead to patents have limited publicly available documentation on where the actual work took place. Were Chinese inventors roaming around Sandia National Lab? Or were they working at a bench at a US research university? Or were they collaborating with American researchers from their office in Beijing?
When R&D fraudsters are prosecuted, the US needs to seize the patents. When US inventors work with China and don’t report it, prosecute the researchers and seize the patents.
The House Committee needs to be mindful of the impact on Chinese American researchers and scientists. American inventors, whether named Zhang or Murphy, are among the most important national assets.
A list of patents with Chinese inventors and an indication of taxpayer funding is a good start. These are the findable patents and patent applications. There are many more hiding in plain sight. The examples above are a start. Unless there is a way to match researchers holding J-1 Visas against inventors on patent applications, there is no easy way to figure out if Chinese Nationals are benefitting from taxpayer R&D funding while working in the US. And good luck with the name matching. There are over 125,000 patents where one of the inventors is named Zhang, one of the most common Chinese surnames. There are 98,125 patents with an inventor named Murphy, too.
Patents provide a useful source of information on the trajectory of R&D and how it aligns with US science and technology policy and the industries that are essential to the US maintaining its global competitiveness.
Intellectual property and know-how are ephemeral. When a scientist from China is done visiting and they get on the plane to fly home, the know-how they acquired while working in the US flies home with them.
Data Improvements
Residence Isn’t Citizenship — Using an inventor’s country residence as a proxy for citizenship is messy at best. On a patent application, there are three boxes one can check to identify the type of residence — US Residence, Non-US Residence, and Active US Military Service. Useful for mailing documents but not for much else. At present, there isn’t an accurate method for identifying the nationality of inventors on US patents beyond information on an inventor's residence, which may be the address used for the patent application and not necessarily the residence an inventor calls home.
Require Nationality on Patent Applications — If you want to track the nationality of scientists benefiting from US taxpayer funding and receiving patents, the patent application must include both a requirement to provide the citizenship/nationality information and a place to put it.
Grant Data Is Limited — Currently, publicly available information on grants has very little information on the team of scientists working on a project and their nationality.. Most grants have the name of a principal investigator and occasionally the names of other investigators on the team. Usually, proposals require the credentials of the key personnel the grant will fund, but this information is not included in the public grant abstracts. You can dig some of it out using the publication lists associated with a grant, but this is a brutal, long slog to get names and institutions.
Patents Last for 20 Years. Contract Data Lasts for 10 — Federal record retention requirements for contracts and grants require an agency to retain the records for ten years after the last payment is made and the contract is closed out. A US patent is valid for up to 20 years from the date the first non-provisional application was filed for a utility or plant patent. FedInvent’s portfolio includes taxpayer-funded patents granted since 2005. This portfolio covers most of the enforceable patents. For many of these patents, the records are gone and the data on the funding is limited. If researchers and science and technology policymakers want longitudinal insight into the trajectory of American innovation, the government needs to maintain the contract data on any contract cited on an enforceable patent.
THE FEDINVENT PATENT REPORTS
FedInvent publishes two data-rich reports. The Tuesday report covers federally funded patents. The Thursday report is about federally funded pre-grant published patent applications. Packed with data, each report includes data and analysis about the inventions, the science, the inventors, and the agencies that funded the work.
The September 17, 2024, patent report is here.
Explore FedInvent 2024. Patent Reports here and 2024 Published Patent Applications Reports here.
As always, thank you for reading FedInvent.
The FedInvent Team
FedInvent tells the stories of inventors, investigators, and innovators. Wayfinder Digital's FedInvent Project follows the federal innovation ecosphere, taxpayer money, and the inventions it pays for. FedInvent is a work in progress. Please reach out if you have questions or suggestions. You can reach us at info@wayfinder.digital.