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By guest blogger Doug Calhoun

A US appeals court has for a second time upheld the validity of the Myriad Genetics gene patent.  In its 16 August 2012 decision: the same judges again decided 2 to 1 in favour of Myriad for the same reasons as in their July 2011 decision.  Each of the judges expanded on her or his reasoning, but their conclusions remained unchanged.

The opponents to gene patenting could leave the matter here; or they could apply to have the case reheard by all 12 judges of the appeal court; or they could appeal to the US Supreme Court.  In either case it would be up to the higher court to decide if they would hear the appeal.

A bit of history 

In 2009, the New York southern district court gave a decision declaring that all the claims of the patents in question were invalid.  Myriad Genetics, the patent owner, appealed to the CAFC (Court of Appeal of the Federal Circuit), which in July 2011 overturned the district court decision on claims to isolated DNA sequences.  That decision was discussed in a Code for Life post:

The opponents to gene patents then appealed to the US Supreme Court.  Earlier this year the US Supreme Court unanimously declared a patent for a method of determining the optimum dosage of a medicine in a patient to be invalid on the ground that the method was merely applying a law of nature.  That Mayo v Prometheus decision is discussed in an earlier guest post:

The next day the Supreme Court “vacated” the July 2011 gene patent decision and instructed the CAFC to reconsider its decision in the light of the Supreme Court’s Prometheus decision.   For all three judges and the lawyers it was groundhog day and deja vue all over again.

Judge Lourie

For Judge Lourie the case was not about whether cancer patients were entitled to a second opinion, nor whether Myriad had acted improperly or for other extraneous reasons.  The case was solely about:

“…whether the claims to isolated BRCA DNA, to methods for comparing DNA sequences, and to a process for screening potential cancer therapeutics meet the threshold test for patent-eligible subject matter.”

His response to the Supreme Court concern about laws of nature was:

“The isolated DNA molecules before us are not found in nature. They are obtained in ingenuity. While they are prepared from products of nature, so is every other composition of matter. All new chemical or biological molecules, whether made by synthesis or decomposition, are made from natural materials. For example, virtually every medicine utilized by today’s medical practitioners, and every manufactured plastic product, is either synthesized from natural materials (most often petroleum fractions) or derived from natural plant materials. But, as such, they are different from natural materials, even if they are ultimately derived from them. The same is true of isolated DNA molecules.”

“… [T]he district court disparaged the patent eligibility of isolated DNA molecules because their genetic function is to transmit information. We disagree, as it is the distinctive nature of DNA molecules as isolated compositions of matter that determines their patent eligibility rather than their physiological use or benefit. Uses of chemical substances may be relevant to the nonobviousness of these substances or to method claims embodying those uses, but the patent eligibility of an isolated DNA is not negated because it has similar informational properties to a different, more complex natural material. The claimed isolated DNA molecules are distinct from their natural existence as portions of larger entities, and their informational content is irrelevant to that fact.”

“The Supreme Court in Mayo focused on its concern that permitting patents on particular subject matter would prevent use by others of, in Mayo, the correlation recited in the method claims. Plaintiffs argue here that they are pre-empted from using the patented DNA molecules. The answer to that concern is that permitting patents on isolated genes does not pre-empt a law of nature. A composition of matter is not a law of nature. Moreover, as indicated earlier, a limited pre-emption is inherent in every patent: the right to exclude for a limited period of time.”

“When the patent expires, the public is entitled to practice the invention of the patent. That is true of all inventions; during the term of the patent, unauthorized parties are “pre-empted” from practicing the patent, but only for its limited term. The seven patents being challenged here all expire by December 18, 2015. “

Judge Lourie also relied on the principle that the US patent law allows for patents over a broad subject matter spectrum.  Patents have been granted for isolated DNA sequences for over 30 years.  If this is to be changed it is up to Congress not the courts:

(“[W]e possess neither the expertise nor the prerogative to make policy judgments. Those decisions are entrusted to our Nation’s elected leaders, who can be thrown out of office if the people disagree with them.”). Congress is presumed to have been aware of the issue, having enacted a comprehensive patent reform act during the pendency of this case, and it is ultimately for Congress if it wishes to overturn case law and the long practice of the PTO to determine that isolated DNA must be treated differently from other compositions of matter to account for its perceived special function.”

Judge Moore

Judge Moore did show a bit more deference to the Supreme Court ‘s referral:

“While the Prometheus decision does not control the outcome in this case, it is nonetheless instructive regarding the scope of the law of nature exception. As an initial matter, the Prometheus discussion of laws of nature (process claims) clearly ought to apply equally to manifestations of nature (composition claims). Myriad’s argument that Prometheus is constrained to methods is an untenable position.”

However, she did agree with Judge Lourie that earlier Supreme Court precedents on composition claims were more relevant than Prometheus.

Judge Moore made a distinction between shorter strands of isolated DNA and a full-length gene, the former clearly having a different utility from the latter and therefore being clearly eligible for a patent.  But she had her doubts about the eligibility of full length isolated DNA sequences:

“If I were deciding this case on a blank canvas, I might conclude that an isolated DNA sequence that includes most or all of a gene is not patentable subject matter. The scope of the law of nature/manifestation of nature exception was certainly enlarged in Prometheus. But we do not decide this case on a blank canvas. Congress has, for centuries, authorized an expansive scope of patentable subject matter. Likewise, the United States Patent Office has allowed patents on isolated DNA sequences for decades, and, more generally, has allowed patents on purified natural products for centuries.”

“As I explain below, I believe we must be particularly wary of expanding the judicial exception to patentable subject matter where both settled expectations and extensive property rights are involved natural products for centuries. There are now thousands of patents with claims to isolated DNA, and some unknown (but certainly large) number of patents to purified natural products or fragments thereof.”

She then expanded on this:

“The settled expectations of the biotechnology industry – not to mention the thousands of issued patents – cannot be taken lightly and deserve deference. This outpouring of scientific creativity, spurred by the patent system, reflects a substantial investment of time and money by the biotechnology industry to obtain property rights related to DNA sequences. The type of fundamental alteration in the scope of patentable subject matter argued in this case ‘risk[s] destroying the legitimate expectations of inventors in their property.’  I believe leaving intact the settled expectations of property owners is particularly important in light of the large number of property rights involved, both to isolated DNA and to purified natural products generally.”

The Supreme Court has warned that ‘courts must be cautious before adopting changes that disrupt the settled expectations of the inventing community.’ The settled expectations of the inventing community with respect to isolated DNA claims are built upon the broad language of the statute, judicial precedent.”

“To change so substantially the rules of the game now, ‘after more than a century of practice, ‘could very well subvert the various balances the PTO sought to strike when issuing the numerous patents which have not yet expired and which would be affected by our decision.’”

“This case typifies an observation by the late Chief Judge Markey, our first Chief Judge, that ‘[o]nly God works from nothing. Men must work with old elements.’ Human DNA is, for better or worse, one of the old elements bequeathed to men to use in their work.”

“We cannot, after decades of patents and judicial precedent, now call human DNA fruit from the poisonous tree, and punish those inquisitive enough to investigate, isolate, and patent it.”

“I will not strip an entire industry of the property rights it has invested in, earned, and owned for decades unchallenged under the facts of this case.”

Judge Bryson

Judge Bryson on the other hand had no such inhibition:

“We … should not shy away from deciding the issues of law that the parties have brought to us. Although my colleagues believe our analysis of the legal question in this case should be influenced by purported expectations of the inventing community based on the PTO’s past practice of issuing patents on human genes, that is in effect to give the PTO lawmaking authority that Congress has not accorded it. There is no collective right of adverse possession to intellectual property, and we should not create one. Our role is to interpret the law that Congress has written in accordance with the governing precedents.”

The main thrust of his dissent is:

“Myriad is claiming the genes themselves, which appear in nature on the chromosomes of living human beings. The only material change made to those genes from their natural state is the change that is necessarily incidental to the extraction of the genes from the environment in which they are found in nature. While the process of extraction is no doubt difficult, and may itself be patentable, the isolated genes are not materially different from the native genes.”

He continues:

“[I]t is an oversimplification to say that something that can be characterized as “isolated” or “extracted” from its natural setting always remains a natural product and is not patentable. One could say, for example, that a baseball bat is “extracted” or “isolated” from an ash tree, but in that case the process of “extracting” the baseball bat necessarily changes the nature, form, and use of the ash tree and thus results in a man made manufacture, not a naturally occurring product. In that setting, man has defined the parts that are to be retained and the parts that are to be discarded, and he has molded. … The result of the process of selection is a product with a function that is entirely different from that of the raw material from which it was obtained. In the case of the BRCA genes, by contrast, nature has defined the genes as independent entities by virtue of their capacity for protein synthesis and, ultimately, trait inheritance. Biochemists extract the target genes along lines defined by nature so as to preserve the structure and function that the gene possessed in its natural environment. In such a case, the extraction of a product in a manner that retains the character and function of the product as found in nature does not result in the creation of a human invention.”

Observations

The main point of agreement between the two majority judges is that the expectations of the biotechnology industry based on both the policy of the US Patent Office and the lack of any express prohibition from Congress dictate that isolated DNA sequences are patentable.

The main points of disagreement are over the nature of an isolated DNA molecule.  For Judge Bryson, “The medium is the message” (Marshall McLuhan).  For Judge Lourie, the message is not relevant – the patent is for the medium.  For Judge Moore, the medium may be the message, but it is now too late to turn back the clock.

It remains to be seen if there is an appeal and if their decision is upheld.  Keep posted.

The situation in Australia remains unchanged from what it was in this guest post:

The challenge to the Australian Myriad gene patent was heard in the Federal Court in February and the decision was still pending as this post went to press.

In New Zealand the GM Royal Commission recommended against any ban on gene patents and the government subsequently accepted that recommendation.  There is no prohibition against gene patents in the Patents Bill now before Parliament.