While doing some IP due diligence I ran into a patent that claimed some art of interest to me. The art was very useful, but it was claimed by a Prominent Professor of chemistry at Well Known University (WKU). Digging a bit deeper I found that the patent had expired well into it’s lifetime due to non-payment of maintenance fees. So, let’s look at this a bit deeper.
Prominent Professor files a patent application in 1998 on said art and then shoots off a paper to Well Known Publication. Then in 2003, the USPTO grants a patent to Prominent Professor and is assigned to WKU. Fine.
If the patent had been generating royalties, it seems unlikely that WKU would have allowed the patent to expire. There is no record of transfer of ownership to another assignee either. My guess is that by the time of the final maintenance fee, interest in the patent was slim to none. Seeing no royalty income likely, WKU elects to allow the patent to expire. Not uncommon.
The work produced by Prominent Professor was funded by DoE. In short, Prominent Professor received public funding and then by virtue of filing for a patent, the technology produced by said public funding is denied use by the public unless they pay again for it in a royalty agreement, unless it was under exclusive agreement with another entity. Evidently the art sat fallow for a good dozen years until it expired. Prominent Professor and WKU got a feather in their caps, and industry and the public had to sit on their thumbs during the period of unproductive time.
This is but one example of a sham allowed under public law.
Lamentations on Chemistry 
I think Derek Lowe had a post that referred to this (with commentary), and part of the response that I received was that unless the tech was patented, it wouldn’t be available at all – if it required materials (primers?) or tech then that tech wouldn’t be developed at all unless it could be patented, and so no one could use it unless there was a patent on it. I don’t like it but don’t know enough one way or the other to say.
If the composition of matter or method of preparation is not claimed, then it is possible to claim a novel, non-obvious method/process involving the use of a public domain composition. I see this frequently in (non-pharma) applications where the *process* claims claim a particular use of a unique public domain substance in a process to produce a particular material. In this case, users of the technology, which I cannot divulge, were barred from a particular class of substances needlessly, as it turned out.
I see Derek’s point regarding the non-adoption of an unpatentable technology.
My point, which I could have made clearer, is that this is an example of poor public policy regarding the use of public resources. Assigning art to universities funded by the gov’t was allowed by the Bayh-Dole Act of 1980.
Your summary of the facts is accurate. This is a deliberate policy of the US government to encourage development of IP generated by government grants. You may agree or disagree with the policy. Without patent protection no company would commercialize the technology. Unfortunately there are side effects of this tpolicy.