In the past year, the National Institutes of Health (NIH) has filed patent applications on more than 2750 partial complementary DNA sequences of unknown function. The rationale for the filings--that patent protection may be necessary to ensure that private firms are willing to invest in developing related products--rests on two premises: first, that NIH may obtain patent rights that will offer effective product monopolies to licensee firms, and second, that unless NIH obtains these rights now, firms will be unable to obtain a comparable degree of exclusivity by other means, such as by obtaining patents on their own subsequent innovations. Neither premise is clearly wrong, although both are subject to doubt in view of statements from industry representatives that the NIH patenting strategy will deter rather than promote product development.