shall, except as provided in paragraph (d) below, make them 
available through licensing on a nonexclusive, royalty-free 
or reasonable royalty basis to qualified applicants. 
(d) The Grantee may license a subject invention on an 
exclusive basis if it determines that nonexclusive licensing 
will not be effective in bringing such inventions to the 
commercial market in a satisfactory manner. Exclusive 
licenses should be issued only after reasonable efforts 
have been made to license on a nonexclusive basis, or where 
the grantee ha3 determined that an exclusive license is 
necessary as an incentive for development of the invention 
or where market conditions are such as to require licensing 
on an exclusive basis. Any exclusive license issued by 
Grantee under a U.S. patent or patent application shall be 
for a limited period of time and such period shall not, 
unless otherwise approved by the Assistant Secretary (Health 
and Scientific Affairs) , exceed three years from the date of 
the first commercial sale in the united States of America of 
a product or process embodying the invention, or eight years 
from the date of the exclusive license, whichever occurs 
first, provided that the licensee 3hall use all reasonable 
effort to effect introduction into the commercial market as 
soon as practicable, consistent with sound and reasonable 
business practices and judgment. Any extension of the 
maximum period of exclusivity shall be subject to approval 
of the Grantor. Upon expiration of the period of exclusivity 
or any extension thereof, licenses shall be offered to all 
qualified applicants at a reasonable royalty rate not in 
excess of the exclusive license royalty rate. 
(e) Any license granted by the Grantee to other than 
the Government of the United States under any patent applica- 
tion or patent on a subject invention shall include adequate 
safeguards against unreasonable royalty and repressive 
practices. Royalties shall not, in any event, be in excess 
of normal trade practice. Such license shall also provide 
that all sales to the U.S. Government shall be royalty free. 
II-6 
[ 36 ] 
