Patentability Of Biotech Inventions Remains Uncertain As Supreme Court Declines Case

BIO, PhRMA, Lilly, Pfizer and Novartis had asked high court to take up Sequenom v. Ariosa to clarify its 2012 ruling in Mayo v Prometheus; now the Federal Circuit's broad interpretation continues to hold sway.

The biotech community was alarmed when the Supreme Court ruled in 2012 that a drug calibration test was ineligible to be patented because its processes did not sufficiently transform a natural phenomenon.

Industry's concern that biotech patient claims could be found invalid as a result of the Mayo Collaborative Services v. Prometheus Laboratories Inc. decision has intensified as the U.S. Court of Appeals for the Federal Circuit has interpreted the opinion. Pharma patent holders contend that the Federal Circuit has taken an expansive view of the ruling that creates immense uncertainty as to whether they can obtain patents on their inventions.

The Biotechnology Innovation Organization, the Pharmaceutical Research and Manufacturers of America, Eli Lilly & Co., Pfizer Inc. and Novartis AG filed amicus briefs urging the Supreme Court to take up Sequenom Inc. v. Ariosa Diagnostics Inc. in order to clarify the scope of its Mayo ruling. But in its June 27 orders the court denied Sequenom's petition for review.

The Sequenom case involves a test for detecting fetal genetic conditions in early pregnancy that avoids invasive techniques, such as amniocentesis. Sequenom's patent covers the process of taking a maternal blood sample, retaining the non-cellular portion, amplifying its genetic material and identifying paternally inherent sequences to distinguish fetal and maternal DNA.

A district court invalidated the patent and the Federal Circuit affirmed, finding that the patent failed the two-step test established in Mayo for determining when a method patent improperly claims a natural law or phenomenon. The test first looks at whether the patent claims are directed to excluded subject matter, and if they are, it assesses whether the claim embodies an "inventive concept," in which the invention transforms the naturally occurring phenomenon into something new and useful (Also see "Supreme Court Overturns Drug Calibration Patents, Creating Confusion In Biotech Realm" - Pink Sheet, 20 Mar, 2012.).

'Crisis Of Patent Law And Medical Innovation May Be Upon Us'

In a joint amicus brief urging the court to review the Sequenom case, BIO, PhRMA and the Association of University Technology Managers noted that Federal Circuit judges had voiced support for Sequenom's patent. Judges Jimmie Reyna and Evan Wallach agreed that Sequenom's method of genetic testing "combined and utilized man-made tools of biotechnology in a way that revolutionized prenatal care." And Judge Richard Linn said he saw no reason why Sequenom's breakthrough invention should be deemed patent ineligible.

But the judges concluded that the patent was invalid under the Supreme Court's mandatory framework for analysis laid out in Mayo and in its 2014 Alice Corp. v. CLS Bank International opinion. In the latter case the court held that a method for exchanging financial obligations was an abstract idea ineligible to be patented.

The Federal Circuit concluded that Sequenom's method failed step one of the eligibility test because it "begins and ends with a natural phenomenon," i.e., "cell-free" fetal DNA (cffDNA). Under step two of the framework, the Federal Circuit dissected the patent claims, disregarded elements relating to the cffDNA and failed to find something innovative in the remaining dissected process elements of the claims.

In a concurring opinion denying en banc review, Federal Circuit Judge Alan Lourie stated, "It is said that the whole category of diagnostic claims is at risk. It is also said that a crisis of patent law and medical innovation may be upon us, and there seems to be some truth in that concern."

BIO and PhRMA asserted that Patent Office statistics support Judge Lourie's observation. They cited a sampling published in the Patently-O Patent Law Journal that found subject matter eligibility rejections of personalized medicine patent applications rose from 15.9% in the few years before Mayo to 86.4% after Mayo.

Intersection Of Natural Phenomena And Human Ingenuity

Novartis asserted in its amicus brief that the Supreme Court's decisions – Mayo, Alice, and Association for Molecular Pathology v. Myriad Genetics Inc., which held that DNA isolated from the human body cannot be patented – "have sent a shockwave of uncertainty through the patent system that has left its principal stewards (the Patent Office and the lower courts) unable to reconcile one decision with the next, and paralyzed to exercise the critical restraint that this Court was so careful in each case to prescribe."

"Meanwhile," Novartis said, "users of the system like us are left scratching our heads as to what remains patent-eligible today, let alone what will still be eligible by the time today's investments in R&D translate into tomorrow's medicines and other healthcare innovations."

Lilly, Eisai Inc., Upsher-Smith Laboratories Inc., Pfizer and Etiometry Inc. assert in their joint amicus brief that the Federal Circuit had invalidated Sequenom patent claims which "clearly meet international norms for patent-eligible subject matter."

They asked the court to consider replacing its "implicit exception" to patentability – which was imposed to assure that patents could not be granted for laws of nature, natural phenomena, or abstract ideas – with explicit patentability requirements.

For now, biopharma companies will have to wait for another case to come along that compels the Supreme Court to clarify which inventions may not be suitable for patent protection. Novartis summed up the urgent need for an answer.

"As the field of biopharmaceuticals continues to evolve from chemically-based treatments designed for all, to biologically-based treatments personalized to the patient, few things are more critical to the future of medicine than the innovation that occurs at the intersection of natural phenomena and human ingenuity."