Your Genes Are Not Patent Eligible, But Your 'Isolated' Genes Are

On remand, the same Federal Circuit panel decided the case for the second time on Aug. 16, 2012. Judge Lourie issued the court's opinion with Judge Moore concurring in part and Judge Bryson concurring in part and dissenting in part. Plaintiffs had sought a declaratory judgment that 15 claims from seven different patents held by Myriad were drawn to patent ineligible subject matter. The court first reviewed jurisdiction over the declaratory judgment case and held that only one plaintiff, Dr. Harry Ostrer, M.D., a researcher at N.Y.U. school of medicine, had standing under MedImmune to properly pursue the declaratory judgment action against Myriad. Reversing the lower court's holding that all plaintiffs had standing, the court held that “simply disagreeing with the existence of a patent on isolated DNA sequences” does not meet the requirement for “an adverse legal controversy of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” In reaching the decision that Dr. Ostrer had standing, the court considered a 10-year-old cease and desist letter from Myriad that caused Dr. Ostrer to cease performing BRCA testing services leaving Myriad as the sole provider of BRCA clinical testing in the United States. Finding that the relative positions of the parties (Ostrer and Myriad) had not changed over the years and that Dr. Ostrer remained ready to provide BRCA testing services, the court held that “Dr. Ostrer need not risk liability and treble damages for patent infringement before seeking a declaration of his contested legal rights.”

Once the court had determined that jurisdiction over at least one plaintiff was proper, it turned to the issue of whether Myriad's composition claims to “isolated” DNA molecules, its method claims directed to “analyzing” or “comparing” DNA sequences, and its claim to a method for screening potential cancer therapeutics were patent-eligible subject matter. At the outset, the court made it clear that it would not consider any public policy factors in its decision, stating that this appeal:

is not about whether individuals suspected of having an increased risk of developing breast cancer are entitled to a second opinion. Nor is it about whether the University of Utah, the owner of the instant patents, or Myriad, the exclusive licensee, has acted improperly in its licensing or enforcement policies with respect to the patents. The question is also not whether is it desirable for one company to hold a patent or license covering a test that may save people's lives, or for other companies to be excluded from the market encompassed by such a patent ' that is the basic right provided by a patent, i.e., to exclude others from practicing the patented subject matter. It is also not whether the claims at issue are novel or nonobvious or too broad. Those questions are not before us. It is solely 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 under 35 U.S.C. ' 101 in light of various Supreme Court holdings, particularly including Mayo.

Addressing Myriad's composition of matter claims, the Federal Circuit noted that while the Supreme Court has consistently interpreted ' 101 of the Patent Act broadly, it has also consistently held that it is not unlimited and its precedents provide three judicially created exceptions to ' 101's broad patent-eligibility principles: “Laws of nature, natural phenomena, and abstract ideas are not patentable.” Mayo, 132 S.Ct. at 1293. In reviewing Myriad's composition of matter claims, the court did not rely on Mayo because it concerned the patentability of method claims and was inapplicable to Myriad's composition of matter claims. Instead, the court relied on the Supreme Court's ruling in Diamond v. Chakrabarty, 447 U.S. at 313, 100 S.Ct. 2204, 65 L.Ed.2d 144 (1980), which held a genetically engineered bacteria to be patent eligible whereas a naturally occurring bacteria is not. The Court in Chakrabarty noted that “the relevant distinction for purposes of ' 101 is ' between products of nature ' and human-made inventions.” The court here held that the isolated DNA at issue is patent eligible because it is not just “purified” DNA as it exists in the body but rather the isolated DNA molecules are markedly different and “result[ ] from human intervention to cleave or synthesize a discrete portion of a native chromosomal DNA, imparting on that isolated DNA a distinctive chemical identity as compared to native DNA.” To be clear, the structural change the court discussed is that the isolated DNA molecule is cleaved from the larger chromosomal molecule by enzymatic cleaving at each end slightly altering the terminal sequences.

The Federal Circuit expressly rejected the arguments adopted by the trial court (and the dissent) that because the isolated DNA retains the same nucleotide sequence as native DNA it does not have any “markedly different” characteristics to the naturally occurring native DNA. The court also recognized that biologists think of molecules such as DNA in terms of their uses, but reiterated that materials of a chemical nature are best described in patents by their structure not their function and, while noting that DNA is a chemical entity that conveys genetic information, the court refused to regard DNA as a special case:

Uses of chemical substances may be relevant to the non-obviousness of these substances or to the 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.

With regard to Myriad's method claims to analyzing and comparing BRCA DNA sequences, the Federal Circuit affirmed both the trial court and its own prior decision in light of the Supreme Court's ruling in Mayo on the ground that they claim only abstract mental processes which is patent ineligible subject matter. The court recognized that Myriad's method claims recite only the mental steps of “comparing” and “analyzing” and were almost indistinguishable from those in Mayo. The claims in Mayo required the steps of “administering” a drug dosage, “determining” the level of drug metabolites and “comparing” that level to predetermined levels to optimize drug dosage. The Supreme Court held those claims patent ineligible because they were “not sufficiently transformative of what was otherwise a claim to a natural law.” Following Mayo, the Federal Circuit similarly held Myriad's method claims invalid under ' 101.

Finally, the Federal Circuit addressed Myriad's method claim for screening potential cancer therapeutics via changes in cell growth in transformed cells. Here, the court held the method claim patent eligible because the claimed method includes the step of “growing host cells transformed with an altered BRCA 1 gene in the presence or absence of a potential cancer therapeutic.” Because the claim includes the step of growing transformed cells that do not occur in nature, the court held that the claim is more than just the abstract mental step of “comparing.”

The Dissent

Judge Bryson in dissent took the diametrically opposed position to the majority with regard to the patent eligibility of isolated gene sequences. He would have affirmed the district court and held Myriad's claims to the BRCA gene sequences and to the shorter probe sequences patent ineligible. But, he would have held patentable the claims to cDNA sequences because they do not occur in nature. Bryson's position is the other side of the coin from the majority's “chemical composition only” approach. Bryson is essentially saying that you cannot separate the functionality of these DNA sequences and call them patentable when “[t]he only material change from their natural states is the change that is necessarily incidental to the extraction of the genes from the environment in which they are found in nature.” Bryson acknowledges that the process of extraction may be very difficult, and may itself be patentable, but in his opinion that does not make those naturally occurring items the products of invention. Bryson further states that even if the bonds that hold the gene in its place in the body are broken, the genetic coding sequence of the BRCA gene is the same whether inside the body or not. Bryson believes that in assessing whether the claimed isolated sequences are new it would be more appropriate “to look to the language of genetics, which provides the language of the claims, than to chemistry.”

To illustrate his point, Bryson made three analogies ' two of which are so simplistic that they, in this author's opinion, may undermine his otherwise well-reasoned dissent. He likens an isolated DNA sequence to a leaf plucked from a tree, or a kidney removed from a body, to demonstrate that neither the leaf nor the kidney would be patentable simply because they are now “isolated” from their naturally occurring environment. His third analogy reminds us that lithium reacts with air and water and exists in nature only as part of a compound with other elements. Elemental lithium has many industrial uses, and isolating it requires breaking the ionic bonds with other components of the naturally existing compound. Bryson makes the point that just as the naturally occurring element, lithium, would not be patent eligible simply because it is was isolated in its elemental form, neither should the isolated BRCA genes be patentable just because covalent bonds have been broken in the process of isolating that DNA.

Clearly, Bryson does not believe, as the majority does, that the gene's functionality can be separated from the chemical structure of the molecule in the patent eligibility analysis. He states that “nature has defined the genes as independent entities by virtue of their capacity for protein synthesis and, ultimately, trait inheritance” and “the structural differences between the 'isolated' genes and the corresponding portion of the native genes are irrelevant to the claim limitations, to the functioning of the genes, and to their utility in their isolated form.” In Bryson's opinion, the claims to the isolated BRCA gene DNA sequence do not meet the patent eligibility standard set by Chakrabarty which evaluates: 1) similarity in structure between what is claimed and what is found in nature, and 2) similarity in utility between what is claimed and what is found in nature. Bryson would hold that the BRCA genetic material is the same structurally and functionally in both the native and the isolated form of the gene.

Conclusion

The majority decision seems somewhat simplistic and literal in finding the isolated DNA sequences “new chemical compositions” while ignoring that the functionality of the gene sequence is unchanged despite minor structural chemical changes to the molecule. This, in addition to the fact that the Supreme Court thought this matter could be resolved in light of its recent holding in Mayo ' a decision the circuit court found inapplicable to composition claims ' makes it likely that the Supreme Court may find the question of the patent eligibility of isolated gene sequences on its doorstep again before too long.

Veronica Mu'oz is a partner in the Intellectual Property practice of Hogan Lovells US LLP in New York and a member of this newsletter's Board of Editors. Formerly a research biochemist, she is a patent litigator and focuses her practice in life sciences technologies.

In a closely followed case involving the patentability of DNA sequences of the BRCA1 and BRCA2 genes, which account for most forms of inherited breast and ovarian cancer, the Federal Circuit largely followed its prior 2011 ruling and again held that isolated DNA sequences are patent-eligible subject matter.

In the trial court, Judge Robert Sweet of the Southern District of New York made headline news when he ruled (on summary judgment) that DNA sequences, isolated from the human genes associated with a predisposition for breast and ovarian cancer and used to diagnose mutations in those genes, were products of nature and, as such, not patentable subject matter under 35 U.S.C. ' 101. Ass'n for Molecular Pathology v. U.S. Patent & Trademark Office , 702 F.Supp.2d 181 (S.D.N.Y. 2009). Judge Sweet's ruling ran counter to the almost three-decade-long policy of the USPTO. backing gene patents. Myriad appealed and a Federal Circuit panel, composed of Circuit Judges Alan D. Lourie, Kimberly A. Moore and William C. Bryson, affirmed in part and reversed in part the lower court. Ass'n for Molecular Pathology, 653 F.3d 1329 (Fed. Cir. 2011). Notably, the circuit court in a reversal of the trial court held that isolated DNA could be patentable. Both parties appealed and the Supreme Court granted certiorari, vacated and remanded the case back to the Federal Circuit for further consideration in light of its recent decision in Mayo Collaborative Services v. Prometheus, Inc. , 566 U.S. __, 132 S.Ct. 1289, 182 L.Ed.2d 321 (2012).

The Second Time

On remand, the same Federal Circuit panel decided the case for the second time on Aug. 16, 2012. Judge Lourie issued the court's opinion with Judge Moore concurring in part and Judge Bryson concurring in part and dissenting in part. Plaintiffs had sought a declaratory judgment that 15 claims from seven different patents held by Myriad were drawn to patent ineligible subject matter. The court first reviewed jurisdiction over the declaratory judgment case and held that only one plaintiff, Dr. Harry Ostrer, M.D., a researcher at N.Y.U. school of medicine, had standing under MedImmune to properly pursue the declaratory judgment action against Myriad. Reversing the lower court's holding that all plaintiffs had standing, the court held that “simply disagreeing with the existence of a patent on isolated DNA sequences” does not meet the requirement for “an adverse legal controversy of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” In reaching the decision that Dr. Ostrer had standing, the court considered a 10-year-old cease and desist letter from Myriad that caused Dr. Ostrer to cease performing BRCA testing services leaving Myriad as the sole provider of BRCA clinical testing in the United States. Finding that the relative positions of the parties (Ostrer and Myriad) had not changed over the years and that Dr. Ostrer remained ready to provide BRCA testing services, the court held that “Dr. Ostrer need not risk liability and treble damages for patent infringement before seeking a declaration of his contested legal rights.”

Once the court had determined that jurisdiction over at least one plaintiff was proper, it turned to the issue of whether Myriad's composition claims to “isolated” DNA molecules, its method claims directed to “analyzing” or “comparing” DNA sequences, and its claim to a method for screening potential cancer therapeutics were patent-eligible subject matter. At the outset, the court made it clear that it would not consider any public policy factors in its decision, stating that this appeal:

is not about whether individuals suspected of having an increased risk of developing breast cancer are entitled to a second opinion. Nor is it about whether the University of Utah, the owner of the instant patents, or Myriad, the exclusive licensee, has acted improperly in its licensing or enforcement policies with respect to the patents. The question is also not whether is it desirable for one company to hold a patent or license covering a test that may save people's lives, or for other companies to be excluded from the market encompassed by such a patent ' that is the basic right provided by a patent, i.e., to exclude others from practicing the patented subject matter. It is also not whether the claims at issue are novel or nonobvious or too broad. Those questions are not before us. It is solely 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 under 35 U.S.C. ' 101 in light of various Supreme Court holdings, particularly including Mayo.

Addressing Myriad's composition of matter claims, the Federal Circuit noted that while the Supreme Court has consistently interpreted ' 101 of the Patent Act broadly, it has also consistently held that it is not unlimited and its precedents provide three judicially created exceptions to ' 101's broad patent-eligibility principles: “Laws of nature, natural phenomena, and abstract ideas are not patentable.” Mayo, 132 S.Ct. at 1293. In reviewing Myriad's composition of matter claims, the court did not rely on Mayo because it concerned the patentability of method claims and was inapplicable to Myriad's composition of matter claims. Instead, the court relied on the Supreme Court's ruling in Diamond v. Chakrabarty , 447 U.S. at 313, 100 S.Ct. 2204, 65 L.Ed.2d 144 (1980), which held a genetically engineered bacteria to be patent eligible whereas a naturally occurring bacteria is not. The Court in Chakrabarty noted that “the relevant distinction for purposes of ' 101 is ' between products of nature ' and human-made inventions.” The court here held that the isolated DNA at issue is patent eligible because it is not just “purified” DNA as it exists in the body but rather the isolated DNA molecules are markedly different and “result[ ] from human intervention to cleave or synthesize a discrete portion of a native chromosomal DNA, imparting on that isolated DNA a distinctive chemical identity as compared to native DNA.” To be clear, the structural change the court discussed is that the isolated DNA molecule is cleaved from the larger chromosomal molecule by enzymatic cleaving at each end slightly altering the terminal sequences.

The Federal Circuit expressly rejected the arguments adopted by the trial court (and the dissent) that because the isolated DNA retains the same nucleotide sequence as native DNA it does not have any “markedly different” characteristics to the naturally occurring native DNA. The court also recognized that biologists think of molecules such as DNA in terms of their uses, but reiterated that materials of a chemical nature are best described in patents by their structure not their function and, while noting that DNA is a chemical entity that conveys genetic information, the court refused to regard DNA as a special case:

Uses of chemical substances may be relevant to the non-obviousness of these substances or to the 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.

With regard to Myriad's method claims to analyzing and comparing BRCA DNA sequences, the Federal Circuit affirmed both the trial court and its own prior decision in light of the Supreme Court's ruling in Mayo on the ground that they claim only abstract mental processes which is patent ineligible subject matter. The court recognized that Myriad's method claims recite only the mental steps of “comparing” and “analyzing” and were almost indistinguishable from those in Mayo. The claims in Mayo required the steps of “administering” a drug dosage, “determining” the level of drug metabolites and “comparing” that level to predetermined levels to optimize drug dosage. The Supreme Court held those claims patent ineligible because they were “not sufficiently transformative of what was otherwise a claim to a natural law.” Following Mayo, the Federal Circuit similarly held Myriad's method claims invalid under ' 101.

Finally, the Federal Circuit addressed Myriad's method claim for screening potential cancer therapeutics via changes in cell growth in transformed cells. Here, the court held the method claim patent eligible because the claimed method includes the step of “growing host cells transformed with an altered BRCA 1 gene in the presence or absence of a potential cancer therapeutic.” Because the claim includes the step of growing transformed cells that do not occur in nature, the court held that the claim is more than just the abstract mental step of “comparing.”

The Dissent

Judge Bryson in dissent took the diametrically opposed position to the majority with regard to the patent eligibility of isolated gene sequences. He would have affirmed the district court and held Myriad's claims to the BRCA gene sequences and to the shorter probe sequences patent ineligible. But, he would have held patentable the claims to cDNA sequences because they do not occur in nature. Bryson's position is the other side of the coin from the majority's “chemical composition only” approach. Bryson is essentially saying that you cannot separate the functionality of these DNA sequences and call them patentable when “[t]he only material change from their natural states is the change that is necessarily incidental to the extraction of the genes from the environment in which they are found in nature.” Bryson acknowledges that the process of extraction may be very difficult, and may itself be patentable, but in his opinion that does not make those naturally occurring items the products of invention. Bryson further states that even if the bonds that hold the gene in its place in the body are broken, the genetic coding sequence of the BRCA gene is the same whether inside the body or not. Bryson believes that in assessing whether the claimed isolated sequences are new it would be more appropriate “to look to the language of genetics, which provides the language of the claims, than to chemistry.”

To illustrate his point, Bryson made three analogies ' two of which are so simplistic that they, in this author's opinion, may undermine his otherwise well-reasoned dissent. He likens an isolated DNA sequence to a leaf plucked from a tree, or a kidney removed from a body, to demonstrate that neither the leaf nor the kidney would be patentable simply because they are now “isolated” from their naturally occurring environment. His third analogy reminds us that lithium reacts with air and water and exists in nature only as part of a compound with other elements. Elemental lithium has many industrial uses, and isolating it requires breaking the ionic bonds with other components of the naturally existing compound. Bryson makes the point that just as the naturally occurring element, lithium, would not be patent eligible simply because it is was isolated in its elemental form, neither should the isolated BRCA genes be patentable just because covalent bonds have been broken in the process of isolating that DNA.

Clearly, Bryson does not believe, as the majority does, that the gene's functionality can be separated from the chemical structure of the molecule in the patent eligibility analysis. He states that “nature has defined the genes as independent entities by virtue of their capacity for protein synthesis and, ultimately, trait inheritance” and “the structural differences between the 'isolated' genes and the corresponding portion of the native genes are irrelevant to the claim limitations, to the functioning of the genes, and to their utility in their isolated form.” In Bryson's opinion, the claims to the isolated BRCA gene DNA sequence do not meet the patent eligibility standard set by Chakrabarty which evaluates: 1) similarity in structure between what is claimed and what is found in nature, and 2) similarity in utility between what is claimed and what is found in nature. Bryson would hold that the BRCA genetic material is the same structurally and functionally in both the native and the isolated form of the gene.

Conclusion

The majority decision seems somewhat simplistic and literal in finding the isolated DNA sequences “new chemical compositions” while ignoring that the functionality of the gene sequence is unchanged despite minor structural chemical changes to the molecule. This, in addition to the fact that the Supreme Court thought this matter could be resolved in light of its recent holding in Mayo ' a decision the circuit court found inapplicable to composition claims ' makes it likely that the Supreme Court may find the question of the patent eligibility of isolated gene sequences on its doorstep again before too long.

Veronica Mu'oz is a partner in the Intellectual Property practice of Hogan Lovells US LLP in New York and a member of this newsletter's Board of Editors. Formerly a research biochemist, she is a patent litigator and focuses her practice in life sciences technologies.