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UPDATE: Appeals Court Decides Isolated DNA Patentable, Myriad's Analytical Method Claims Not


This article was updated July 31 from an earlier version posted July 29. The updated version includes additional analysis on the lawsuit and comments from Duke University's Robert Cook-Deegan.

By Turna Ray

While ruling that isolated gene sequences are not products of nature and are therefore patentable, the Court of Appeals for the Federal Circuit last week deemed several of Myriad Genetics' method claims that describe "comparing" and "analyzing" gene sequences invalid.

The decision overturns a district court ruling in Association for Molecular Pathology et al. v. US Patent and Trademark Office et al., which invalidated seven of Myriad's BRCA patents related to its flagship BRACAnalysis test.

In the suit, filed in 2009, patients, healthcare providers, and researchers represented by the American Civil Liberties Union and the Public Patent Foundation are challenging Myriad's patent claims on methods of comparing isolated gene molecules and genomic DNA in the body, as well as claims on genomic DNA itself. The lawsuit alleges that the BRCA gene patents held by the University of Utah Research Foundation and exclusively licensed to Myriad "stifle research that could lead to cures and limit women's options regarding their medical care" (PGx Reporter 05/13/2009).

In invalidating 15 claims in seven patents held by Myriad last year, Judge Robert Sweet of the Federal District Court of Southern New York reasoned that isolated BRCA1/2 gene sequences were not markedly different from naturally occurring gene sequences in the body, particularly in the information they contain. Sweet also asserted in his decision that comparisons of isolated gene molecules and genomic DNA sequences are abstract mental processes, which are not patentable under 35 USC Section 101 (PGx Reporter 03/31/2010).

Last week, however, in a two-to-one decision, the federal circuit court reversed the district court's decision on Myriad's composition claims on isolated DNA molecules, "since the molecules as claimed do not exist in nature."

Although this decision was not unanimous, the majority opinion of the federal appeals court is specifically at odds with Sweet's reasoning that isolated DNA molecules are patent ineligible primarily because they have similar information to the DNA in the body. "We disagree [with the district court], 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," the court states. "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 appeals court also maintained claim 20 of Myriad's patent No. 5,747,282, describing a method of screening potential cancer therapeutics by gauging changes in cell growth rates, as patent eligible. According to the judges, claim 20 is patentable, unlike five other claims on "analyzing" and "comparing" DNA sequences, because it involves transformative steps.

Far-Reaching Impact?

The appeals court's decision to invalidate Myriad's method claims that describe "comparing" or "analyzing" DNA sequences because they involve "no transformative steps and cover only patent-ineligible abstract, mental steps," could have immediate consequences for the life sciences industry.

According to Courtenay Brinckerhoff, a partner at Foley & Lardner, the federal circuit's decision "could have a far-reaching impact on other patents, including those directed to genetic screening, but also possibly to other types of claims, like personalized medicine type claims."

The federal appeals court's determination that "comparing" and "analyzing" gene sequences don't constitute transformative steps is in line with the Supreme Court's recent decision in Bilski v. Kappos, which centered on the application of the so-called machine-or-transformation test. In Bilski, the Supreme Court decided that the machine-or-transformation test – a way of assessing patent eligibility based on whether an invention is tied to a machine or undergoes some sort of transformation in order to be patentable – cannot be the sole determinant of patentability for inventions in the Information Age, such as advanced medical diagnostics (PGx Reporter 06/30/2010).

Following the Bilski decision, the federal appeals court reviewed its decision in another case, Prometheus v. Mayo, which involved a dispute over Prometheus Labs' patents covering methods for determining the optimal dosage of drugs to treat stomach disease. The appeals court determined that there were certain transformative steps involved in Prometheus' method claims, making them patent eligible. Mayo is currently challenging that decision before the Supreme Court, asserting that Prometheus' patents claim a natural phenomenon (PGx Reporter 06/22/2011).

Explaining its decision in AMP v. USPTO, the federal appeals court said that Prometheus' claimed methods involved steps to "determine" the drug's metabolite levels in a patient in order to adjust drug dosing — a distinction from Myriad's claims on "comparing" and "analyzing" gene sequences, which are merely mental processes.

Given the federal court's stance on the analytical method claims, "practitioners and patent holders may want to review pending and granted claims to determine where they might fall on the Myriad/Prometheus transformation spectrum," Brinckerhoff noted.

Dissenting Opinions

Three circuit judges – Alan Lourie, Kimberly Moore, and William Bryson – heard oral arguments in the appeals case in April. Lourie wrote the opinion for the court, Moore wrote a concurring statement, and Bryson wrote an opinion that agreed with the other two judges about the patentability of cDNA and method claims, but disagreed that isolated gene sequences were patentable.

"I respectfully dissent … from the court's holding that Myriad's BRCA gene claims and its claims to gene fragments are patent-eligible," Bryson wrote in his statement. "In my view, those claims are not directed to patentable subject matter, and if sustained the court's decision will likely have broad consequences, such as preempting methods for whole-genome sequencing, even though Myriad's contribution to the field is not remotely consonant with such effects."

In Bryson's view, Myriad's claims on isolated gene sequences don't hold up because the company neither discovered the BRCA gene, nor did it invent a new method of nucleotide sequencing to extract the stretch of DNA from the surrounding biological material.

"Of course, Myriad is free to patent applications of its discovery. As the first party with knowledge of the sequences, Myriad was in an excellent position to claim applications of that knowledge. Many of its unchallenged claims are limited to such applications," Bryson wrote. "Yet some of Myriad's challenged composition claims effectively preempt any attempt to sequence the BRCA genes, including whole-genome sequencing."

During oral arguments in the appeals case in April, the federal circuit judges questioned Myriad as to whether whole-genome sequencing-based diagnostics could potentially infringe the company's patents. At the time, Myriad's lawyer said that whole-genome sequencing that didn't involve an isolating step wouldn't infringe its patents. Experts have noted that this explanation wasn't very informative and raised more questions than it answered (PGx Reporter 04/06/2011).

Ultimately, the disagreement among the judges centers around the question of whether genomic DNA that has the same sequence as found in nature can be patented. "There it's two to one, and the two concurring opinions give different reasons," Robert Cook-Deegan, director of Duke University's Center for Genome Ethics, Law & Policy, told PGx Reporter.

Lourie's reasons for deeming isolated DNA patentable focuses on the fact that the process of isolation requires severing of covalent bonds in the DNA molecule. Moore's reasoning centers on the idea that isolated DNA, particularly shorter sequences developed into primers and probes, represent a new utility for DNA sequences than when they exist in nature. With regard to longer stretches of DNA, however, Moore acknowledged that if she were deciding this case on a "blank canvas" she "might conclude that an isolated DNA sequence that includes most or all of a gene is not patentable subject matter."

According to Cook-Deegan, given that Lourie and Moore cite different reasons for upholding patents on "isolated DNA molecules," this might be the basis for further appeals in this case.

One issue raised by Lourie's discussion of the court's decision is that he appears to suggest that while isolating DNA can be patentable, "purification" of DNA is not. "Purification makes pure what was the same material, but was previously impure," Lourie writes. "Although isolated DNA must be removed from its native cellular and chromosomal environment, it has also been manipulated chemically so as to produce a molecule that is markedly different from that which exists in the body. It has not been purified by being isolated."

Although this language is not binding in a legal sense, it does raise some questions. "That leaves open the next challenge of this type, [focusing on] the patentability of purified substances," Brinckerhoff observed.

The federal appeals court's decision is in contrast to a controversial brief on AMP v. USPTO filed last year by the US Department of Justice. In that brief, the DoJ held that the New York Southern District Court wrongly invalidated Myriad Genetics' composition claims "directed solely to cDNAs." However, the government agreed with the lower court that genes as they occur in the body are not products of human invention worthy of a patent. "Crossing the threshold of [patentability under 35 USC] Section 101 … requires something more than identifying and isolating what has always existed in nature, no matter how difficult or useful that discovery may be," the DoJ stated in the brief (PGx Reporter 11/03/2010).

During oral arguments, the DoJ used the analogy of the "magic microscope" to explain its stance that claims to isolated DNA, such as claim 1 of Myriad's patent No. 5,747,282, aren't patentable because a "magic microscope" can see the DNA in a human body. In the federal circuit court's decision, Lourie rejected the DoJ's "magic microscope" test, noting that "isolated DNAs, not just cDNAs, have a markedly different chemical structure compared to native DNAs." Lourie further wrote that the government's proposed "magic microscope" test "misunderstands the difference between science and invention and fails to take into account the existence of molecules as separate chemical entities."

Finally, both Moore and Lourie agree that it is not the job of the courts to draw categorical exceptions to the patent law, by deeming, for example, that all business method patents (as in Bilski) or that all patents on isolated DNA do not meet the criteria set forth under Section 101. Such exceptions to the law can only be drawn by the US Congress, the judges said.

Noting that the US Patent and Trademark Office has in the past thirty years granted 40,000 DNA-related patents covering 20 percent of the genes in the human genome, Lourie noted that thus far Congress has not deemed the USPTO's actions to be inconsistent with Section 101. "If the law is to be changed, and DNA inventions excluded from the broad scope of Section 101 contrary to the settled expectation of the inventing community, the decision must come not from the courts, but from Congress," Lourie wrote.

Managing Expectations

The ACLU and PUBPAT believe that the federal appeals court erred in its decision regarding the patent standing of isolated DNA. In a statement, Daniel Ravicher, executive director of PUBPAT and co-counsel in the lawsuit, maintained that "pieces of the human genome are not patentable … because no one 'invents' genes. Inventions are things like new genetic tools or drugs, all of which can be patented because they are not genes themselves."

Despite having several of its method claims invalidated, Myriad lauded the federal circuit's ruling. "We believe this decision is in the best interests of the agriculture, biotechnology and pharmaceutical industries, as well as the hundreds of millions of people whose lives are bettered by the products these industries develop based on the promise of strong patent protection," Myriad CEO Peter Meldrum said in a statement.

The company pointed out that the majority of its BRCA 1 and BRCA 2 patent suite is unaffected by the latest court decision. "With respect to the BRCA 1 and BRCA 2 genes, Myriad has 237 method claims for BRACAnalysis [that] were not affected by this ruling and remain in full force and effect providing Myriad with equally strong method of use patent protection," the company said in a statement.

In Cook-Deegan's view, Myriad's claim that the federal appeals court's determination won't affect the bulk of its BRACAnalysis patents is not entirely accurate. "All three judges agreed that the very broad method claims are invalid. Myriad is saying it has hundreds of other method claims that have not been invalidated. That's right, but most are irrelevant for practical purposes, and some might be equally invalid," Cook-Deegan said via e-mail. "Their contention that the claims they lost don't matter is on pretty thin ice, since they are the broadest claims."

Perhaps Myriad would never have enforced these invalidated patents, "but their invalidation does create some room for competition," he said, noting that the company's claim that the appeals court ruling won't significantly impact its BRCA diagnostics testing business is "misleading and should be challenged."

Indeed, Lourie notes that the court asked Myriad to show other, unchallenged patent claims that would restrict a Harry Ostrer – a former New York University researcher and the only plaintiff the judges deemed to have a legitimate cause for legally challenging Myriad's patents – from performing BRCA diagnostic testing. However, the company could not present any examples that would have that effect. Moreover, some of Myriad's broad patents on BRACAnalysis are slated to expire in 2014 and 2015, at which point other labs could begin to offer BRCA testing.

Beyond the IP around its BRACAnalysis test, Myriad's main market advantage could ultimately reside in a proprietary database housing 14,000 genotype-phenotype associations, as well as data on variants of unknown significance. This resource could continue to provide the company market advantages in the BRCA mutation testing market, even with the loss or expiration of certain method patents.

PUBPAT and the ACLU charged that by maintaining Myriad's patents on isolated gene sequences the court is allowing the company to remain the sole provider of BRCA genetic testing for hereditary breast and ovarian cancer, which restricts women's access to other BRCA mutation testing options and hampers their ability to get a comprehensive second opinion. "No corporation should be able to claim ownership of a woman's own genetic information," Sandra Park, staff attorney with the ACLU Women's Rights Project, said in a statement. "The court has made the wrong decision for women's health."

However, the federal court of appeals rejected the notion that patients have a valid cause to challenge Myriad's patents simply because the patents protect a technology that the company is charging a high price for. "While denial of health services can, in certain circumstances, state a judicially cognizable injury … [w]e fail to see how the inability to afford a patented invention could establish an invasion of a legally protected interest for purposes of standing," Lourie wrote.

AMP v. USPTO has been closely watched by the drug and diagnostics industries. If the federal circuit deemed isolated gene sequences categorically not patentable, it would have serious consequences for companies that market products protected by gene patents. The judges recognized this.

"The settled expectations of the biotechnology industry – not to mention the thousands of issued patents – cannot be taken lightly and deserve deference," Moore wrote. "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."

Most experts following the case have speculated that AMP v. USPTO will eventually end up before the Supreme Court. While the ACLU issued a statement calling the appeals court ruling "a blow to the idea that patent law cannot impede the free flow of ideas in scientific research," the organization did not say whether it intends to appeal the decision.

The judges' commentary suggests that those who believe that gene patents shouldn't be allowed may need to seek legislative changes to the patent law through Congress. PUBPAT's Ravicher said that the plaintiffs are considering their options.

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