Gene patents—a win for all

Authors: Sarah Matheson, Trevor Davies and Yan-Lin Lee (Allens)

Cancer Voices Australia v Myriad Genetics Inc [2013] FCA 65, Australian Federal Court

Journal of Intellectual Property Law & Practice (2013) doi: 10.1093/jiplp/jpt106, first published online: June 30, 2013

 In a landmark decision the Australian Federal Court confirms that isolated nucleic acids encoding genes and their biological products are patentable subject matter, and that naturally occurring DNA or RNA as they exist inside cells of the human body are not patentable. This provides much-needed reassurance to the biotechnology industry and patients alike.

Legal context

In 2010, advocacy organization Cancer Voices Australia, together with breast cancer survivor, Yvonne D'Arcy (collectively, CVA), sought to revoke claims of BRCA1, a patent owned by Myriad Genetics Inc and licensed exclusively to Australian company Genetic Technologies Limited (collectively, Myriad). Those claims are directed to isolated nucleic acid coding for germ–line mutations in the BRCA1 gene that can be used to detect pre-disposition to breast and ovarian cancers.

CVA contended that the relevant claims were invalid on the ground that isolated nucleic acid was not a ‘manner of manufacture’ that satisfied the threshold requirement for patentability under Australian law. To meet that requirement, the claimed invention must

* consist of an artificial state of affairs (ie a result of human intervention); and

* be of some practical utility in a field of economic endeavour.

The Australian test for patent-eligible subject matter remains tied to England's first expression of patent law: the Statute of Monopolies 1624 and, with it, centuries of English and Australian interpretation, most notably the decision of the High Court of Australia, National Research Development Corporation v The Commission of Patents (1959) 102 CLR 252 (NRDC).

Facts

In 1994, researchers isolated and sequenced the BRCA1 gene, determining its chemical structure and association with familial breast cancer. This involved the removal of the nucleic acid from its natural environment in the human body, and its separation from other cellular components.

Genetic Technologies provides an accredited testing service in Australia. In 2008 Genetic Technologies sent ‘cease and desist’ letters to Australian public laboratories. Public outcry forced Genetic Technologies to withdraw its threats. CVA nonetheless initiated its revocation action in 2010 on the basis that Genetic Technologies could seek to enforce the relevant claims of the BRCA1 patent while they remained on foot.

CVA's challenge focused on the following:

* the subject matter of the patent was merely a scientific discovery of a naturally occurring biological fact;

* the subject matter was not a patentable invention, as it was not a manner of manufacture that satisfies the threshold requirement for patentability;

* in any event, the BRCA1 gene is not patentable because it relates to ‘biological processes for the generation of human beings’.

This last point refers to the sole statutory exclusion from patentability under the Australian Patents Act 1990: human beings, and the biological processes for their generation, are not patentable inventions.

Analysis

Citing NRDC, the court concluded that the removal of nucleic acid from its natural environment, and its separation from other cellular components, gives rise to an artificial state of affairs, notwithstanding that the chemical composition of nucleic acid before and after isolation may be the same. The court relied on a number of matters including the considerations that:

* Australia's High Court has taken an expansive approach to the requirement of manner of manufacture in order to give effect to parliamentary intention that patents should foster further innovation;

* in the absence of human intervention, naturally occurring nucleic acid does not exist outside the cell, and nor does it exist naturally inside the cell;

* the process of isolation, extraction and purification of biological material often requires extensive skill and investment, thereby justifying a reward for the research and intellectual effort expended, being the grant of a patent.

Further, the court is not required to ask whether:

* a composition of matter is a ‘product of nature’. That may be an unhelpful approach, especially in the field of biotechnology in which micro-organisms play a critical role in the development, manufacture and use of diagnostic and therapeutic products and techniques;

* a micro-organism is ‘markedly different’ from something that already exists in nature for the purpose of deciding whether it constitutes patentable subject matter.

The court also considered its findings reinforced by the fact that DNA and RNA, unlike human beings and their biological processes for generation, are not expressly non–patentable under the Patents Act.

Importantly, the court confirmed two other matters. First, naturally occurring DNA or RNA as they exist inside cells of the human body are not patentable. Secondly, in order to be patented, isolated nucleic acid or any other biological material must still meet the other patentability thresholds of novelty, inventive step and usefulness.

Forthcoming appeal

An appeal has been filed, notwithstanding the fact that Cancer Voices Australia has dropped out of the proceeding. This leaves Yvonne D'Arcy potentially exposed to an adverse costs order in the event the Federal Court's decision is upheld.

Numerous grounds of appeal are cited, but the key grounds are that the primary judge erred in finding that:

* the relevant claims amount to a manner of manufacture and thus a patentable invention; and

* because the isolated nucleic acid claimed is a product of human invention, the inventions claimed involve the creation of an artificial state of affairs.

It is expected to be some months before the appeal is heard.

Practical significance

On one view, this decision should not be surprising because it simply confirms longstanding Australian Patent Office practice that has consistently recognized isolated DNA and RNA as patentable subject matter. However, that has not stopped lengthy public debate as to whether genes and their biological products should be patented.

On the other hand, this decision (if upheld on appeal) should settle the debate and give certainty to Australia's $48 billion biotechnology industry. Greater certainty should encourage greater future investment. Medicine is more reliant than any other industry on innovation to drive better care and efficiency. The invention which is the subject of this case has resulted in new tests to detect predisposition to breast and other cancers, and has improved the clinical outcome of many patients throughout the world.

Further, the decision is consistent with the present position in other jurisdictions. Having been referred by both parties to the legal position in Europe, the United Kingdom and the United States, the Australian judge found that it is clear that in the UK, as in many other parts of Europe, isolated DNA and RNA may be patentable even though they are identical in their chemical composition to DNA and RNA found in the cell. In litigation in the USA concerning Myriad Genetics' US patent, the Court of Appeal also upheld the validity of the claims (by a majority). However, the law there remains unsettled as the US Supreme Court has now heard oral arguments in an appeal. Its decision is not known at the time of writing.

What may ultimately be more relevant are various legislative proposals in light of the Australian government's response to inquiries in relation to intellectual property rights over biological materials. The response recognized the role of the patent system in fostering investment in medical research. The government stated categorically that it does not support the exclusion of human genes, genetic products and methods of diagnostic, therapeutic or surgical treatment from patentable subject matter.

The response also acknowledged the importance of ensuring fair and reasonable access to patented medical technologies—both for the community and for research purposes. The government has accepted recommendations:

* to amend the Patents Act to exclude inventions, the commercial exploitation of which would be ‘wholly offensive to the ordinary, reasonable and fully informed member of the Australian public’;

* to create a discretionary power to exclude inventions from patentability to protect ‘public order or morality’; and

* to include a statement of objectives, including an objective to balance the rights of patent holders with the interests of technology users, and the well-being of Australians generally.

One of the most significant impacts on gene patents in Australia may yet be the recent introduction of an express research exemption which applies to tests, trials and procedures that a researcher or a follow-on inventor undertakes as part of discovering new information or testing a principle. The exemption applies where the activities are for the dominant purpose of research.

Finally, other amendments introduced by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 are intended to raise the standard of patents granted in Australia generally. This will include patents directed to biological materials.

To the extent that opponents of gene patents are concerned that such patents restrict research and public access to diagnostic tests and medical procedures by awarding monopolies, in the authors' view, these fears are in large part answered in Australia by the confirmation given by the Federal Court in Myriad and the recent and proposed reforms to the Patents Act.