By Kirell Lakhman

Oral arguments for AMP and the ACLU's gene-patent law suit against Myriad Genetics began earlier this week at the US Court of Appeals for the Federal Circuit, and some expect a decision to be handed down in as little as two months.

The start of oral arguments signals that things are about to get serious not only for Myriad and its BRCAnalysis assay, but all other clinical labs that patent human DNA to develop molecular tests.

The original decision, handed down last March by the US District Court for the Southern District of New York, had limited influence because it is merely a state court. By comparison, an opinion by the Washington, DC-based Federal Appeals Court will bind all federal courts, with the exception of the Supreme Court — to which most legal experts believe the case will head whatever the outcome of Myriad's appeal.

ACLU's statement about the start of oral arguments can be found here.

Myriad will make its appeal either in front of three judges (why does the word "troika" come to mind?) or the full 12-judge panel. A loss could cause the test maker to appeal directly to the chief judge of the court, Randall Rader, a President George W. Bush appointee "who has previously appeared pro-patent, which is favorable for Myriad."

However, one noteworthy observation is that in August 2010 the plaintiffs filed a motion to have Rader recuse himself from the case because of some comments he made at two different legal conferences, according to The Prior Art blog.

The plaintiffs said his remarks "indicated a preexisting view that the Myriad district court decision was wrong," John Conley wrote in Genomics Law Report at the time, adding that his comments "were so abstract that the argument seemed far-fetched."

None of this apparently bothers RBC Capital analyst Michael Yee, who last week told the International Business Times that "a number of positive factors … could suggest a positive outcome, or [could even] overturn" the original decision.

He added that "we believe a formal decision could occur in June."

Further fueling Yee's outlook is that in November the AMA is expected to alter BRACAnalysis' CPT codes by increasing its reimbursement price to around $3,000. Myriad currently charges up to $4,000 for the assay, according to the Yale Cancer Center Genetic Counseling Program. On average payors cover 90 percent of the cost, and average BRCAnalysis co-pays are around $100.

According to the IBT, one factor that could help Myriad's appeal is "whether AMP had standing or jurisdiction to litigate in the first place." Moreover, since the suit was filed in May 2009 two respected organizations put their weight behind the test maker: The American Bar Association wrote a 13-page report and the US Department of Justice wrote an amicus brief that each supports a company's right to patent isolated genomic DNA.

Another factor, which the company has repeated numerous times (see here, here, and here), is that if it loses the appeal its business will largely remain intact because its other BRCA1/2-related patents, as far as this case is concerned, will continue to be protected.

For instance, Myriad's composition-of-matter patents are expected to expire in 2018, while certain methods-of-use IP are expected to survive through 2022-2023. By then, other test makers — including academic, private, and reference labs — could freely try their hand in the BRCA1/2 market.

But Myriad insists it has that angle covered, too: Its trove of 15,000 BRCA1/2-related mutations could give it an important competitive advantage over potential rivals watching the clock.

As I wrote around this time last year, Myriad's loss in the New York district court will have no effect on any patents not directly tied to the case, and the decision itself will have no binding impact on any other court.

As Dan Vorhaus and Conley put it in Genomics Law Report at the time, the New York court's ruling "is currently very limited," and "it is highly unlikely that the USPTO will change its gene patent-examination standards just because of this decision."

"Another federal district judge would be free to reach exactly the opposite conclusion tomorrow," Vorhaus wrote, adding that "things won’t get serious (legally) until the Federal Circuit rules, since its opinion will bind all federal courts except the Supreme Court."

In other words, things are about to get serious and the "tempest in a teapot" may need a bigger kettle.

The oral appeal arguments that begin today come almost exactly one year after a New York district court judge said it was illegal for Myriad Genetics to own the genes used in its BRCA1/2 breast and ovarian cancer-susceptibility test.

The suit, filed by AMP and the ACLU, argued that the BRCA gene patents — indeed, all gene patents — "stifle research that could lead to cures and limit women's options regarding their medical care."

Other plaintiffs include the Public Patent Foundation at the Benjamin N. Cardozo School of Law and a bevy of clinical lab specialists, patients, and patient advocates

Besides Myriad, defendants include the US Patent and Trademark Office and the University of Utah Research Foundation, which holds the patents to the BRCA1 and BRCA2 genes.

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