Bloomberg News

Blood-Test Case at Top Court May Send ‘Shock Waves’

December 06, 2011

(Corrects story published yesterday to remove reference to licensing of patents in seventh paragraph.)

Dec. 6 (Bloomberg) -- Computer, drug and biotechnology companies have a message for the U.S. Supreme Court as it prepares for arguments this week on patents for diagnostic medical tests: Be careful.

Companies, trade groups and lawyers have filed more than two dozen legal briefs, many warning that the court’s ruling might have widespread, unintended ramifications. Each side in the case, which pits Nestle SA’s Prometheus unit against the Mayo Clinic, says a defeat might stifle innovation.

“The claims have to do with diagnostic methods, but it has the potential to touch industries we don’t know about,” said Erika Arner, a Washington lawyer who filed a brief asking the the court not to restrict software and computer patents.

Because the court will consider the most fundamental question in patent law -- what can be patented -- the ruling “will or could have shock waves across all industries,” said Arner, who represents SAP America Inc., a business-software maker based in Newtown Square, Pennsylvania.

The case is the second at the Supreme Court since 2010 concerning what types of inventions are eligible for legal protection. The latest case, to be heard on Dec. 7, will test the longstanding principle that natural phenomenon can’t be patented. A lower court ruled that two patents now owned by Prometheus were potentially valid because they involve the application of a law of nature, not the law itself.

Stomach Medicine

The patents cover a method for determining the proper dosage of thiopurine, a stomach medicine, based on the rate at which particular patients metabolize the drug. Doctors can use the method, which involves testing blood for metabolites, to maximize effectiveness and limit toxic side effects while treating Crohn’s disease and other inflammatory bowel illnesses.

Prometheus is suing two units of the Mayo Clinic, the not- for-profit medical practice based in Rochester, Minnesota. Mayo at one point shipped patient samples to Prometheus and paid the company to perform the test. That relationship ended in 2004, when Mayo created its own test.

Mayo contends the patents would give Prometheus a monopoly over all uses of the natural relationship between the metabolites created by thiopurine and the drug’s impact on the human body. The patents are so broad they would bar doctors familiar with the Prometheus method from even thinking about the connection between metabolite levels and the proper dosage for a patient, Mayo’s lawyers say.

‘Doctor’s Thought Processes’

The case is about “how far can patents intrude into a doctor’s thought processes when a doctor is ordering a routine test from a lab and then thinking about the results in the context of patient treatment,” said Jonathan Singer, a lawyer at Fish & Richardson PC in Minneapolis who represents Mayo.

Prometheus counters that its patents concern concrete applications of scientific principles, which the Supreme Court has long said fall within the scope of the U.S. Patent Act.

The patents cover “processes which apply that knowledge in a series of physical steps that enable physicians to improve patient treatment,” Prometheus argued in court papers. Nestle, based in Vevey, Switzerland, acquired Prometheus this year.

The case may have its greatest impact on the field of personalized medicine, an emerging practice that involves determining whether a patient is genetically susceptible to a particular disease or would be especially responsive to certain treatments. Two companies focusing on that field, Myriad Genetics Inc. and Novartis AG, are backing Prometheus.

Opposing Views

“The important and developing industry of personalized medicine would be seriously jeopardized if such substantial and innovative contributions to science and medicine were denied patent protection at the doorway of the Patent Act,” Myriad said in a court filing.

The American Medical Association says the exact opposite is the case. “Patents on scientific observations threaten to stifle innovation, including the development of personalized medicine,” the AMA and 10 other medical groups said in a court filing backing Mayo.

Mayo also has the support of Verizon Communications Inc., Hewlett-Packard Co., Laboratory Corporation of America and AARP, which represents older Americans. Prometheus has backing from trade groups for the drug and biotechnology industries.

The Obama administration is urging the court to take a middle ground. The government says the Prometheus process probably isn’t the type of genuine innovation that would warrant legal protection. At the same time, the administration says the types of methods involved in the case should at least be eligible for patent coverage.

Mixing Chemical Substances

“The mixing of chemical substances for a useful result is a quintessential patent-eligible process,” the government argued in court papers. A ruling declaring those types of methods ineligible “would cast doubt on a host of patents for transformative medical processes that are novel and non- obvious.”

The high court would be wise to continue to act with caution in patent cases, says Adam Mossoff, a patent-law expert who teaches at George Mason University School of Law in Arlington, Virginia.

“The Supreme Court does not want to formulate a rule that inadvertently prevents the next wave of innovation,” Mossoff said. “The potential error cost to future innovation is very high in these cases.”

The case is Mayo Collaborative Services v. Prometheus Laboratories, 10-1150.

--Editors: Justin Blum, Michael Shepard

To contact the reporters on this story: Greg Stohr in Washington at gstohr@bloomberg.net; Susan Decker in Washington at sdecker1@bloomberg.net.

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net; Michael Shepard at mshepard7@bloomberg.net.


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