In plain English
FAR 52.227-7, Patents-Notice of Government Licensee, is a solicitation provision shown with its prescription in the official text, most recently dated Apr 1984. The complete official text is reproduced below, verbatim, from GSA's published FAR source files.
Its text contains no sentence requiring insertion into subcontracts; see the flowdown section below for what that does and does not mean.
Does it flow down to subcontracts?
No flowdown mandate found in the clause text
This is a solicitation provision — it applies to offerors when submitting an offer, not to contract performance, so subcontract flowdown is generally not the operative question for it.
The official text, verbatim
As prescribed at 27.202-5(b), insert the following provision:
Patents-Notice of Government Licensee (Apr 1984)
The Government is obligated to pay a royalty applicable to the proposed acquisition because of a license agreement between the Government and the patent owner. The patent number is ____ [Contracting Officer fill in], and the royalty rate is ____ [Contracting Officer fill in]. If the offeror is the owner of, or a licensee under, the patent, indicate below:
□ Owner □ Licensee
If an offeror does not indicate that it is the owner or a licensee of the patent, its offer will be evaluated by adding thereto an amount equal to the royalty.
(End of provision)