Published in January 2015, this essay compared and contrasted how federal courts in the US and Australia responded to Myriad Genetics’ patent claims to certain breast cancer genes. At that time, the High Court of Australia had not yet reviewed the decision from the Federal Court of Australia in Sydney. The lower court had granted validity to Myriad’s patents, and the decision had been unanimously upheld in a subsequent appeal. But in October 2015, the High Court ruled them invalid, much like the US Supreme Court had. Genomics Law Report has an in-depth analysis of this final decision. The following essay will give you insight into the cases origins and development prior to that decision. This essay appears in the book Patents and Public Health, available in paperback and Kindle.
Human Genes in the Global Market:
How Two Nations Reached Opposing Conclusions to the Myriad Genetics Case
Original publication date: January, 2015.
The Origins of Biological and Genetic Patents in the US
The Origins of the Myriad Genetics Case in the US and Abroad
The Myriad Genetics Case in the US
The Origins of the Myriad Genetics Case in Australia
The Decisions in the Myriad Case in Australia
The Myriad Genetics cases in the United States and Australia focus on patent control of two human gene sequences and the clinical methods of detecting them. Myriad Genetics patents refer to the genes as “17q-linked breast and ovarian cancer susceptibility gene” due to their location on the long arm of human chromosome 17. They received the names BRCA1 and BRCA2 from Mary Claire King, whose group at the University of California, Berkeley identified them in published research in 1990. Myriad Genetics’ subsequent patent claims on BRCA1 and BRCA2 entered litigation in the US in 2009 and Australia in 2010, and met with dispute in the European Union and Canada. The US Supreme Court issued a final decision on the validity of the patent claims in 2013, reversing an earlier decision at the Circuit Court level which had, in turn, reversed an initial decision at the District Court level. The Federal Court of Australia’s appeals court reached a judgment in September, 2014 upholding a Federal Court decision from 2013. While the US Supreme Court invalidated the patents covering the gene sequence, the Australian courts upheld them. The differences in both the legal precedents and the patent terminology in each country have a direct bearing on why such opposing decisions happened. The political and economic realities of today’s globalized business environment also influenced the decisions. To the extent that patents help enforce intellectual property rights, understanding how each nation came to its decision provides insight into the role of human genetic material in today’s global information society.
Keywords: BRCA1, BRCA2, discovery, genes, European Patent Office, Federal Court of Australia, Genetic Technologies, intellectual property, invention, litigation, Myriad Genetics, patent, US Supreme Court.
I. The Origins of Biological and Genetic Patents in the US
The 2013 decision by the US Supreme Court in Association for Molecular Pathology v. Myriad Genetics, Inc. definitively concluded four years of mixed judicial response to the case. Myriad’s patents became invalid at the District Court level in 2010, but the Court of Appeals for the Federal Circuit reversed this decision, returning Myriad’s patent rights to them (Supreme Court Orders, 2012, p. 26). The Supreme Court, after ordering the Court of Appeals to review and reconsider its decision in 2012, eventually reversed the decision again, striking down the patents in 2013 just three years before they would have expired (Victory for Genes, 2013, p. 792). This mixed judicial response follows a pattern of conflicting US court decisions about biological material, a pattern showing distinctly different agendas between the Supreme Court and the Circuit Court.
The legality of patenting natural genetic material first came into question in 1948 in a case concerning a combination of different bacteria which, when applied to seeds, assisted in nitrogen uptake in adult plants (Leal, 2014, p. 406). The Supreme Court ruled in Funk Brothers Seed Co. v. Kalo Inoculant Co. that, because all of the bacteria occurred naturally, they could not be patented (Leal, 2014, p. 407.) The court’s decision asserted the qualities of these naturally occurring bacteria “like the heat of the sun, electricity, or the qualities of metals, are part of the storehouse of knowledge of all men… manifestations of laws of nature, free to all men, and reserved exclusively to none” (Rogers, 2013, p. 446). Patents were intended to provide protection to inventions and inventors, and the court did not consider naturally occurring biological material to be an invention.
This decision showed consistency with an earlier case regarding biological material in 1874: American Wood Paper Co. v. Fibre Disintegrating Co. In that case, the Supreme Court “rejected a patent for cellulose isolated from nature” on the basis that extracting a natural substance by “decomposition or disintegration of material substances” did not render that biological substance eligible for patent (Rogers, 2013, p. 444). This thinking foreshadowed the Supreme Court’s 2013 decision in Myriad, summarized by Justice Clarence Thomas: “Myriad did not create or alter any of the genetic material in the BRCA1 and BRCA2 genes. The location and order of the nucleotides existed in nature before Myriad found them. Nor did Myriad create or alter the genetic structure of DNA” (Victory for Genes, 2013, p. 792).
Ten years later, however, in the 1958 case Merck & Co. v. Olin Mathieson Chemical Corp., the court ruled in favor of patenting biological material concentrated or purified from its natural state (Leal, 2014, p. 407). This decision differed from Funk Bros. owing to the modification of the material, in this case vitamins and adrenalin, which brought the naturally occurring material into a new form. Subtle though the difference may be, the court’s decision shows consistency with their earlier thinking: discovering a natural biological material does not make the material patent eligible, but inventing new forms of it could. The crux of the matter lies in the invention, not the discovery.
Two events in the 1980s reinforced this thinking but began a new stage in the patenting of biological material and organisms. The 1980 case Diamond v. Chakrabaty involved the creation of a new form of bacteria, one that did not occur naturally (Leal, 2014, p. 408). Here, the Supreme Court upheld its thinking on discovery versus invention. While the Funk Bros. case involved bacteria found in nature, the newly created bacteria in Chakrabaty qualified as an invention. The court ruled that “anything… made by man” could be eligible for patenting (Leal, 2014, p. 408). The Supreme Court split five-to-four on the Chakrabaty decision, but the deciding factor was the ability of the bacteria to decompose crude oil—ability not found in naturally occurring bacteria and thus qualifying for invention (Rogers, 2013, p. 448).
In1987, this thinking found reinforcement in Ex parte Allen, a challenge to a rejection of a patent involving the genetic material of oysters wherein cell nuclei could be induced to contain “multiple DNA chromosomes of the same type” (Leal, 2014, p. 408). The Board of Patent Appeals and Interference referred to Chakrabaty as precedent that, as an invention, genes and even whole organisms were patent-eligible. The United States Patent and Trademark Office (USPTO) issued a statement agreeing with this.
The Court of Appeals for the Federal Circuit which decided in Myriad’s favor made a similar decision in 1993. In their ruling on In re Bell, the court disregarded the fact that DNA sequences occur naturally and reduced them to mere chemical compounds eligible for patents (Leal, 2014, p. 409). Disregarding the Supreme Court’s insistence on invention rather than discovery, this court opened the doors for patents on naturally occurring genes. This move that resulted in “more than three million gene-related patents” applied for in the next ten years, “several thousand” of which the USPTO approved (Leal, 2014, p. 409). Clearly, the Court of Appeals had different ideas than the Supreme Court and did not consider invention a necessary component of patent eligibility. This attitude foreshadows the Australian court decisions regarding Myriad Genetics, and Chakrabaty would earn a mention in the reasoning of those decisions.
II. The Origins of the Myriad Genetics Case in the US and Abroad
During this ten-year wave of genetic patent applications, Myriad applied for a patent on BRCA genes in 1994, with an update to clarify the gene sequence in 1995 (Bosch, 2004, p. 1780). Published research from the University of California, Berkeley in 1990 had revealed “the general location of a gene linked to breast cancer” (Patent Act of 1952, 2013, p. 388). Mary Claire King led the UC team which announced their findings at the American Society of Human Genetics Meeting. Though the team identified the gene BRCA1 “on chromosome 17 through a technique called linkage analysis,” researchers from the United Kingdom, France, Belgium, the Netherlands, and Canada all collaborated in attempts to map BRCA1 and BRCA2 (Gold, 2010).
Following this announcement, Mark Skolnick of the University of Utah’s Centre for Genetic Epidemiology, a competing laboratory, spun off Myriad Genetics from his group in 1991 to obtain venture capital for this line of research (Gold, 2010). Myriad Genetics soon isolated BRCA1 and BRCA2. Next, they invented clinical testing methods to identify mutations in the genes relating to increased risk for breast and ovarian cancer (Patent Act of 1952, 2013, p. 388). Myriad Genetics sought to patent not only the clinical methods they invented, but the naturally occurring genetic material they discovered.
The USPTO granted Myriad patents covering 47 mutations in the BRCA1 gene in 1997, then five additional patents covering the BRCA1 gene and associated tests, and finally two patents in 1998 “covering methods of detecting BRCA1 mutations and the entire sequence of the BRCA1 gene and tools used” in Myriad’s work, the last of which “covered all uses of the BRCA1 gene” (Gold, 2010). The patents positioned Myriad as the only entity with legal rights to isolate the gene itself. And since their testing methods required isolating the gene, they became the only entity with legal rights to test for it, too (Patent Act of 1952, 2013, p. 389).
The patents covering BRCA2 would come later. The Cancer Research Campaign first filed for a patent on BRCA2 in the United Kingdom, having funded research by a UK group of 40 researchers from six countries who published the gene’s sequence in Nature in December, 1995 (Gold, 2010). Just one day before this publication, however, US researchers including Mark Skolnick claimed this work was only a partial sequence and only covered six mutations of BRCA2. Skolnick’s group deposited the complete sequence into a database of gene sequences (Gen-Bank), published their findings in Nature Genetics in 1996, and filed for US patents—patents issued by the USPTO in 1998 and 2000 (Gold, 2010). In the US, Myriad Genetics gained intellectual property control over BRCA1, BRCA2, the methods of their isolation, and the clinical tests based on the isolation.
Despite approval in the US, the patents met resistance overseas—not in courts, but at the European Patent Office (EPO). The EPO had granted three patents to Myriad in January, 2001, but “several European research centres, along with other organizations and the European Parliament, filed a joint opposition to the patent in October, 2001” (Bosch, 2004, p. 1780). The conflict stemmed not from the debate over invention versus discovery but from Myriad’s denial of licenses to research the genes, and its refusal to let any laboratories but its own test DNA samples using its technology (Bosch, 2004, p. 1780). The opposition called this an “abusive monopoly,” and the EPO revoked the patent on May 18, 2004 (Bosch, 2004, p. 1780). The revoked patent covered the diagnostic test, though the Technical Board of Appeal subsequently limited the scope of the patents on the mutations of the BRCA1 gene in 2005, and the Board greatly limited the patent over BRCA2 that year as well (Gold, 2010). The EPO did not invalidate all of Myriad Genetics’ BRCA-related patents, but they greatly limited the scope of the material and testing processes involved.
Myriad Genetics also pursued patent control and licensing arrangements in Canada, but the full extent of the Canadian campaign exceeds the scope of this paper. Briefly, the Canadian province of Ontario supported local BRCA testing without regard to Myriad’s patenting attempts in Canada, resulting in a highly charged political situation. At one point, the US made threats of trade sanctions against Canada. But after years of posturing, committee reviews, inflammatory letters, political spectacle, and debate, Myriad “decided to give up on the Canadian market” when they could not bully Canada into enforcing the patents (Gold, 2010). Myriad’s failure to force total control over BRCA genes and testing in the European Union and Canada foreshadowed its eventual defeat in the US Supreme Court.
III. The Myriad Genetics Case in the US
In the US, opposition began in 2009 when the American Civil Liberties Union (ACLU) and the Public Patent Foundation called the constitutionality of the patents into question, filing suit against Myriad Genetics and the USPTO (Victory for Genes, 2013, p. 792). The ACLU was joined in this effort by “six nonprofit organizations that engage in research and advocacy, eight university-affiliated scientists whose work was impeded by Myriad’s patents, and six individuals who were unable to obtain desired BRCA screenings because of Myriad’s monopoly on testing” (Patent Act of 1952, 2013, p. 389). “The District Court for the Southern District of New York granted summary judgment for the plaintiffs in 2010,” ruling against Myriad’s patent claims for the composition of the BRCA genes and its testing methods (Cong, 2012, p. 755). The District Court “invalidated seven of Myriad’s US patents relating to the BRCA1 and BRCA2 genes and associated genetic tests” (Gold, 2010). The judge in this case, Judge Sweet, referred to the existing Supreme Court decisions regarding naturally occurring biological material and physical phenomena (Patent Act of 1952, 2013, p. 389-90). Judge Sweet also struck down the methods claims covering the processes for clinical testing.
The Court of Appeals, however, upheld the patents, reversing the District Court’s decision, and again upheld their own decision in August, 2012 after the remand ordered by the Supreme Court (Cong, 2012, p. 755). The remand order from the Supreme Court considered its recent decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc. “Prometheus, having patented a method of adjusting dosages based on patients’ biological response” had sued Mayo Collaborative Services “which had developed a similar test” (Supreme Court Orders, 2012, p. 26). In Prometheus, the Supreme Court unanimously found the method in question for determining dosages merely described natural laws, and Justice Breyer made it clear the court believed “granting monopolies over laws of nature through patents would impede future research rather than promote innovation” (Patent Act of 1952, 2013, p. 390). The court ruled in favor of Mayo.
The Circuit Court, ordered to reconsider their decision in this light, still did not agree. In terms of discovery versus invention, the Circuit Court’s majority asserted that although the DNA in question occurred naturally, the process of cleaving the DNA and isolating it led to “distinctive chemical composition” that rendered it patent-eligible (Cong, 2012, p. 756). Specifically, the Circuit Court referred to the Chakrabaty decision’s emphasis on biological material with characteristics different from those occurring in nature. The differing characteristic in Myriad was that the isolated BRCA genes lacked introns in their molecules, something they had in their naturally occurring forms, and this lack made them “especially distinctive” (Patent Act of 1952, 2013, p. 391). Judge Lourie’s opinion for the majority argued that the genes in question were distinctly different from naturally occurring ones due to their separation from the larger DNA molecule in the isolation process (Patent Act of 1952, 2013, p. 391). The Australian courts would later favor this rationale.
While the Supreme Court reached a unanimous decision in Mayo, the Circuit Court found itself split on the matter (Rogers, 2013, p. 436). The dissenting opinion argued nothing about the isolation process for BRCA changed the “structure or function of naturally occurring genes,” thus invalidating claims of invention and rendering the genes ineligible for patenting (Cong, 2012, p. 756). Judge Bryson’s dissenting opinion argued merely separating a component of the larger DNA molecule did not render it any more eligible than a kidney could become patent-eligible upon removal from the human body, or a mineral could become patent-eligible simply because someone extracted it from the earth (Patent Act of 1952, 2013, p. 392). Despite this straightforward, common-sense reasoning, the other Circuit Court judges outvoted Judge Bryson two-to-one. The Circuit Court, in failing to acknowledge that “isolated DNA segments have the identical nucleotide sequence and the same function as native DNA” and lack both the “marked changes required under Chakrabaty” and the “inventive step required under Prometheus,” disregarded “150 years of Supreme Court cases that physical phenomena found in nature and the laws of nature are not patentable subject matter” (Rogers, 2013, p. 434).
Upon the failure of this remand to invalidate the patents, the ACLU petitioned the Supreme Court to take up the case. The court “held that isolated DNA molecules are not patent eligible” and “rejected the Federal Circuit’s contention that the chemical changes created during the isolation process made the molecules distinctive” (Patent Act of 1952, 2013, p. 393). The court, consistent with its historical decisions, ruled the BRCA genes “are a product of nature and therefore ineligible for patenting” (Myriad Diagnostic Concerns, 2013, p. 571). This decision was unanimous. It marked the “first time that the US Supreme Court has invalidated a human gene” patent (Victory for Genes, 2013, p. 792).
IV. The Origins of the Myriad Genetics Case in Australia
The story of Myriad Genetics’ patent litigation did not end with the US Supreme Court’s decision. It continued in Australia. But before the matter came to court, some interesting things happened with the Australian licensee of the BRCA patents: Genetic Technologies, Ltd (GTG). Myriad Genetics had licensed the BRCA test to GTG “because GTG was pursuing Myriad for patent infringement,” and the patent conflict between the companies resolved in each gaining licensing rights to the other’s DNA patents (Gold, 2010). Things became complicated in 2007 when Dr. Merv Jacobson, CEO and co-founder of GTG and its largest shareholder, retired. As reported in Australian Life Scientist, Jacobson, who would maintain a position as a non-executive director, had preferred not enforcing the company’s patent rights on BRCA; instead, he called BRCA testing “GTG’s gift to Australia” (O’Neill, 2009).
New CEO Michael Ohanessian decided to change this relaxed policy, a move that would mean public laboratories would “no longer be permitted to perform commercial testing on [their] patients for mutations of the genes,” although the change would not block their ability to continue research on the genes (O’Neill, 2009). Dr. Jacobson objected so vehemently that he announced he would seek a resolution to remove Ohanessian and four other directors, the chairman, and three non-executive directors. The effects of this announcement included GTG’s requesting the Australian Stock Exchange “halt trading of its shares” (O’Neill, 2009). The company backed down from its threat of enforcing “its patent rights against laboratories offering BRCA testing” in October, 2008 (Cook-Deegan, 2014). Ohanessian was eventually deposed as CEO as a result of this conflict, though Dr. Jacobson also resigned soon after (O’Neill, 2009).
The conflict spurred the Australian Senate to hold “a series of hearings, and a bill proscribing DNA sequence patents was proposed, but the new government opposed it, and it lapsed” (Cook-Deegan, 2014). GTG thus enjoyed a position of benevolent power, unthreatened by any new governmental legislation regarding DNA sequences. The difference between the Australian situation and the cases in Europe, Canada, and America lies in the good will of Dr. Jacobson at GTG which could not be more different than the heavy-handed approach Myriad Genetics took to other international markets.
Dr. Jacobson, quoted in Australian Life Scientist, explained his position on not enforcing GTG’s BRCA testing patents. Dr. Jacobson noted that government laboratories, out of fear of patent enforcement from Myriad Genetics, had begun BRCA testing but not invested in it enough to make it a timely process, and “some women were waiting up to two years, which would put them at risk of developing cancers as they waited.” Because GTG won “exclusive rights to perform BRCA testing in Australia and New Zealand,” they “set up a state-of-the-art laboratory, at least as good as Myriad’s, that would perform BRCA testing accurately, and in much less time.” The GTG labs eventually reduced the testing time to “two months” and even “as little as four weeks.” Motivated to create a “socially responsible strategy,” Jacobson asserted that GTG was not “Myriad’s policemen” and did not obtain the patent rights “to beat up other testing laboratories… If people wanted to do BRCA testing themselves, they were free to do so, but if they wanted our help, they had that too” (O’Neill, 2009).
Despite these statements of good will from Dr. Jacobson, the conflict makes it clear that if Genetic Technologies had wanted to enforce its patents, it had the legal right to do so—a legal right that covered both private, potential competitors and public, governmental health facilities. GTG’s benevolence stemmed from the humanitarian philosophy of just one doctor, and policy could easily go the other way once he retired or moved on. This is why, in 2010, the BRCA patents entered litigation in Australian courts. It was not, as in the case of the European Patent Office, that Myriad Genetics created an abusive monopoly. It was merely the threat that such a state would come to pass. This is why Paul Grogan, the Director of Advocacy at Cancer Council Australia, would tell the Australian press, “In 2008, Australian women were only protected from an attempted commercial monopoly over the BRCA1 and BRCA2 tests because the company that threatened to take those tests away from public laboratories withdrew its patent claims voluntarily… There was nothing in the law to protect healthcare customers” (Corderoy, 2014). These healthcare customers began the Australian litigation.
V. The Decisions in the Myriad Case in Australia
The organization Cancer Voices of Australia, along with cancer survivor Yvonne D’Arcy of Brisbane represented by the law firm of Maurice Blackburn, filed suit against Myriad and GTG in 2010 (Guardian, 2014). The case entered the Federal Court of Australia in Sydney, Judge Nicholas presiding (Conley, 2010). Judge Nicholas issued a decision on February 15, 2013 in favor of Myriad and GTG, dismissing all charges (Cancer Voices, 2013, p. 39). An appeals court subsequently heard the case. On September 5, 2014, its panel of five judges unanimously ruled to uphold Judge Nicholas’ decision (Cook-Deegan, 2014). The appeals court—the Federal Court of Australia, New South Wales District Registry, General Division—after a lengthy discussion recapitulating the scientific and precedent reasoning of the previous court, dismissed the appeal (D’Arcy, 2014, p. 3). At the time of this paper, the case may still be appealed at one final level—the Australian High Court (Masnick, 2014). Though it may be too early to close the book and draw conclusions about the state of genetic patents in Australia, examining of the reasoning of these two Australian Federal Courts is worthwhile.
As with many of the earlier cases discussed here, Judge Nicholas examined the difference between invention and discovery. He explains, after a lengthy lesson on the fundamentals of DNA and genetic science, the reasoning behind determining “whether isolation of naturally occurring DNA and RNA results in an artificial state of affairs with a discernible effect – whether claims to isolated DNA and RNA are to a ‘mere discovery’ and therefore not patentable – whether claims to isolated DNA and RNA are to a ‘product of nature’ and therefore not patentable” (Cancer Voices, 2013). Despite the weight other courts have given to the difference between discovery and invention, the appeals court in Australia found this subject of little concern in their decision. As Dr. Robert Cook-Deegan explained, the legal reasoning of the appeals court:
clearly states that a distinction between invention and discovery is not a fruitful conceptual framework for patent law, and quite explicitly rejects the U.S. Supreme Court’s arguments in AMP v Myriad. The opinion lauds Judge Lourie of the U.S. Court of Appeals for the Federal Circuit, who upheld Myriad’s claims on isolated DNA molecules in two majority opinions that were unanimously reversed by the U.S. Supreme Court (Cook-Deegan, 2014).
Dr. Cook-Deegan may be overstating the appeals court’s disregard for the concept of invention versus discovery, though. Paragraphs 110-115 in the decision directly address discovery and invention, cite Australian cases going back to 1903 as precedent, and mention the US cases of Funk Bros. and Chakrabaty (D’Arcy, 2014, 23-5). The court in this case, however, targeted terms more widely argued in Australian patent law; specifically “artificially created state of affairs” and “matter of manufacture,” both terms somewhat unfamiliar in the US but important legal concepts in Australia.
As to whether or not a manufactured item was a “product of nature” and whether or not a microorganism would be “markedly different from something that already exists in nature,” the court reasoned “there was no requirement” for determining these things in Australian patent law, based on the precedents (D’Arcy, 2014, p. 24). The court examined precedent that “invention may consist of using the material or some new adaptation of it so as to serve the new purpose. If the new use consists in taking advantage of a hitherto unknown or unsuspected property, there may be invention” (D’Arcy, 2014, p. 24). The court determined it is “only necessary to show one inventive step in the advance made beyond the prior limits of the relevant art” (D’Arcy, 2014, p. 25). In other words, within the context of Australian patent law, invention can mean finding a new use for an old thing, or taking previous uses and advancing them one more step.
This argument about the nature of invention and its relevance to intellectual property and patent rights is nothing new, but neither is it without criticism. The advancement of science and invention relies on methods, equipment, and knowledge of previous workers, researchers, and institutions. In the context of developing new medicines and medical treatments, “the intellectual labor that went into the drug design process did not occur from first principles; rather, in every case, the inventor’s thought process was critically shaped by the cumulative insights of his or her predecessors” (Shah, p. 844). This argument does not deny the continual process of invention; rather, it denies the wisdom of granting exclusive patent control to persons, corporations, or institutions who, having stood on the shoulders of giants, now presume to extend unilateral control over products and processes that utterly depend on prior work for their existence.
Wisdom, however, did not concern the Australian appeals court, and they said so:
This case is not about the wisdom of the patent system. It is about the application of Australian patent law, as set out in the Act and as developed by the courts since the Statute of Monopolies. It is not about whether, for policy or moral or social reasons, patents for gene sequences should be excluded from patentability. …It is not a matter for the court, but for Parliament to decide. Parliament has considered the question of the patentability of gene sequences and has chosen not to exclude them but to make amendments to the Act to address, in part, the balance between the benefits of the patent system and the incentive thereby created, and the restriction on, for example, subsequent research (D’Arcy, 2014, p. 47).
If neither concern for wisdom, nor the distinction between invention and discovery, nor ethical problems with patenting products of nature informed the thinking of the court, then what did? In a word: isolation. First, based on the testimony of genetic scientists quoted at length in the decision by Judge Nicholas, the court decided the isolated portions of the DNA molecule in Myriad’s isolated BRCA material are chemically “different to the gene comprising the nucleic acid sequence as it exists in nature” (D’Arcy, 2014, p. 49). Counter arguments from depositions and testimonies cited in the decision assert the genetic information encoded was still the same, and the chemical changes noted by the court merely resulted from the molecule’s separation from its natural place in the chain. The Australian court did not find these counter arguments compelling enough to sway its decision. It stands in opposition to the opinion from Supreme Court Justice Clarence Thomas which states “We… hold that genes and the information they encode are not patent eligible… simply because they have been isolated from the surrounding genetic material” (Victory for Genes, 2013, p. 792).
The court further determined “isolation of the nucleic acid also leads to an economically useful result—in this case, the treatment of breast and ovarian cancers” (D’Arcy, 2014, p. 49). Determining the creation of “economically useful results” plays a significant role in Australian patent law. Plus, while the Supreme Court might find a product of nature ineligible for patent, the Australian court found excluding products of nature “is not in accordance with the principles of patent law in Australia and has been specifically rejected as a reason for exclusion in” a precedent-setting case (D’Arcy, 2014, p. 50).
This precedent comes from 1959’s National Research Development Corporation v Commissioner of Patents which “requires that an invention apply to an ‘artificially created state of affairs’” (Cook-Deegan, 2014). As Dr. Robert Cook-Deegan explained, “this criterion in effect means that if ‘we did it in our lab’ it will clear the threshold for patent eligibility. Given this precedent, the Federal Court’s ruling is sensible” (Cook-Deegan, 2014). The genetic material isolated in Myriad Genetics’ processes “has resulted in an artificially created state of affairs for economic benefit,” and therefore “is properly the subject of letters patent” that meets the requirements of section 18(1) of Australia’s Patent Acts 1990 (D’Arcy, 2014, p. 50).
Thus, the two Australian courts decided in favor of the patent-eligibility of Myriad’s clinical testing processes and the piece of genetic material the tests isolate from human DNA, given the slight chemical change (absence of introns) that happens in the isolation process. The Australian courts believe this subtle distinction does not threaten to extend patent control to the human genome itself either in part or in whole. As Judge Nicholas noted in his original decision,
There is no doubt that naturally occurring DNA and RNA as they exist inside the cells of the human body cannot be the subject of a valid patent. However, the disputed claims do not cover naturally occurring DNA and RNA as they exist inside such cells. The disputed claims extend only to naturally occurring DNA and RNA which have been extracted from cells obtained from the human body and purged of other biological materials with which they were associated (Cancer Voices, 2013, p. 38-9).
Dr. Cook-Deegan argued this rationale about isolation, however, is a “lawyer’s trick” that creates patent infringement on the part of anyone attempting to analyze DNA molecules containing the BRCA sequences; and, the imprecise nature of defining isolated genetic material—as opposed to the same material in its original place in the DNA molecule—will block any researcher’s ability to access, understand, or experiment on these cancer-associated mutations without being subject to potential litigation (Cook-Deegan, 2014). Myriad’s patent claims include “broadest method claims” giving them “exclusive rights to any way of comparing the DNA sequence from a sample to the reference sequence of the BRCA1 and BRCA2 genes disclosed in Myriad’s patents” (Cook-Deegan, 2013, p. 298). This means the patents, as upheld by the Australian case, at least, extend to merely comparing a DNA sample to the known (and naturally occurring) BRCA sequences. In other words, a public health facility or private laboratory cannot even compare a sample to a piece of discovered human DNA without infringing the patent. Or, to put it in simplest terms: Do not even look at it. It is difficult to imagine how such utter control over genetic research activities can possibly benefit innovation, despite proponents of the Australia decision rallying around the judgment as a victory for medical and genetic innovation.
These concerns may well be met and resolved in the Australian High Court, or they may not. Either way, the story will not end there. Each nation has its own patent laws. Each nation potentially faces this same time-consuming and costly journey through the judicial system to arrive at its own conclusions. Australia and the US have cooperated extensively on creating mutual trade agreements to cover intellectual property rights and patent rights. But, their opposing decisions on the Myriad Genetics cases demonstrate patent laws on biological materials and the human genome have not yet reached the level of international standardization aimed for by instruments like the World Trade Organization’s TRIPS and TRIPS-plus agreements. If such a standard already existed, such as ones developing for pharmaceutical products, software, and other forms of intellectual property, the US Supreme Court and the Federal Court of Australia would not find themselves so diametrically opposed on such a fundamental concern.
Patents, as a means of claiming property rights to produce financial gain, involve the economic incentives for knowledge production. Is patent protection of knowledge necessary to drive the innovation required for growth and technological advancement in today’s information society? No clear consensus exists. As one Australian patent lawyer said in response to the September ruling by the appeals court, “This decision is also certainly not going to stifle research and innovation in this field; in fact, I wonder if we will see more US companies starting to try to commercialise things here” (Corderoy, 2014). This echoes a belief held by some in the US that the Supreme Court’s ruling is “the latest of a series of reverses to the intellectual property (IP) foundations needed to support innovative diagnostic enterprises” (Myriad Diagnostic Concerns, 2013, p. 571).
Such arguments miss the finer point: the distinction between patenting innovative processes for researching genetic material and clinically testing it, versus patenting the genetic material itself. This is the wisdom in Judge Bryson’s opinion at the US Circuit Court level. Judge Bryson understood that innovation and invention reside in new ways of doing things, new technologies, new processes and methods, new equipment and products. These are the things that patents were meant to cover, not the human genome, and not naturally occurring phenomenon. Judge Bryson understood this point, the Supreme Court came to understand it, and the European Patent Office and Canada also understood it. All of them have invalidated, ignored, or severely restricted the kind of patent rights Myriad Genetics and its licensees have tried so vigorously to assert for more than a decade now in their nations.
One might easily suspect the Australian courts understood the distinction as well, but brushed it aside to create a climate where US corporations would feel encouraged to bring new businesses and new streams of revenue to their nation. As one of the leading proponents of international trade agreements governing intellectual property rights, Australia may well set the tone of patent legislation being designed in developing nations seeking to become compliant with TRIPS and join the World Trade Organization. Other nations may look to them as a role model for creating patent laws concerning human genetic material based not on reality or science or common sense, but purely on the desire to attract multinational corporations into doing business in their country. The case of Myriad Genetics has been long and complex. But in today’s era of globalization, it is far from over.
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