Mayo and Myriad: Can Two Patent Rulings Chill Innovation?

8/7/12

Two recent patent cases have engendered considerable uncertainty regarding the ability of biotechnology and pharmaceutical companies to patent their commercial products and methods.

The first case, Mayo Collaborative Services v. Prometheus Labs., Inc., relates to the patent eligibility of certain diagnostic methods. On March 20th, the U.S. Supreme Court unanimously ruled that the personalized medicine dosing protocols at issue in the case were effectively “laws of nature,” and were therefore not eligible for patent protection. This decision reversed an appellate court’s ruling that the claims were patentable, and it created uncertainty regarding the validity of patents relating to medical diagnostics.

But it is the second case—the forthcoming decision in the closely-watched Myriad case—that could really upend decades of settled expectations about patent-eligible subject matter, and could call into question the validity of thousands of patents for pharmaceutical and biotechnology companies. This has the potential to create a devastating effect on future innovation.

Myriad originated in 2009, when several plaintiffs filed a lawsuit challenging seven of Myriad Genetics’ patents on isolated DNA molecules derived from the BRCA1 and BRCA2 genes and diagnostic methods using these molecules.

In 2011, the Court of Appeals for the Federal Circuit (CAFC), the appellate court specializing in patent cases, ruled that isolated BRCA1 and BRCA2 DNAs were patent-eligible. In reaching its decision, the CAFC concluded that the claimed DNAs were not a “product of nature,” a category which the Supreme Court repeatedly has held to fall outside the statutory bounds of patentable subject matter. Rather, the isolated DNAs were deemed a “human-made invention” because they are markedly different from what is found in nature.

The Myriad plaintiffs subsequently petitioned the Supreme Court to hear the case. In response, the Supreme Court instructed the CAFC to reconsider Myriad in view of the Supreme Court’s recently issued Mayo decision.

Numerous third parties have weighed in on the current round of the Myriad litigation, submitting friend-of-the-court briefs to the CAFC. The interest in Myriad by the likes of the Biotechnology Industry Organization (BIO) is obvious: BIO represents companies that rely upon DNA patents similar to those that are the subject of the Myriad litigation. But BIO’s interest extends to companies involved in the development and production of pharmaceuticals, pesticides, industrial enzymes, and biofuels.

How does a court case concerning isolated DNA relate to the ability of biotechnology and pharmaceutical companies to protect their diverse commercial products? Quite simply, many companies are concerned that a finding that isolated DNA is not patent-eligible could affect patents covering other molecules, many of which are derived from natural sources in some way.

Indeed, while Myriad is frequently portrayed as a legal battle over the question of whether genes are patentable, it is difficult to discern a principled distinction between isolated DNA and an isolated natural product such as penicillin or rapamycin. Moreover, many legal analysts believe it is unlikely that a court would fashion a rule of patent eligibility applicable to DNA alone. Thus, whatever the outcome of Myriad, its impact may extend well beyond DNA.

A ruling by the CAFC in Myriad is expected this fall. It would be a surprise if the CAFC deviates substantially from its earlier decision. Regardless of the outcome, the losing party will almost certainly petition the Supreme Court to take the case, and it is far from clear how the Supreme Court would rule.

Compounding the uncertainty is the protracted nature of the case: A decision would be unlikely to come prior to spring of 2013. Until then, many stakeholders in the chemical and life sciences arenas will face uncertainty regarding the strength of their U.S. patents.

Michael Robinson, an associate at Clark+Elbing, contributed to this piece.

Michael Belliveau is a partner at Clark+Elbing, a Boston patent prosecution firm. His work involves patent prosecution, opinion work, and investment due diligence. Follow @

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