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High Court Justices Seek Compromise in Gene-Patent Case

April 15, 2013

U.S. High Court Justices Seek Compromise in Gene-Patent Case

Several justices asked whether barring gene patents would deter innovation by stripping companies of legal protection for their research. Photographer: Andrew Harrer/Bloomberg

A U.S. Supreme Court clash over the patenting of human genes left several justices searching for a middle ground in a case with the potential to redefine rights in the biotechnology and agricultural industries.

The justices, hearing arguments yesterday in Washington, discussed chocolate-chip cookie recipes, baseball bats and Amazonian plants while grappling with a challenge to Myriad Genetics Inc. (MYGN:US)’s patents on genes linked to breast and ovarian cancer. A group of doctors, patients and scientists say the patents are stifling clinical testing and research.

In an hour-long session that repeatedly touched on the financial incentives for research, several justices suggested they weren’t willing to invalidate Myriad’s claims entirely. Biotechnology innovators have received thousands of patents on human genes over the past 30 years, and a sweeping ruling would call some of those patents into question.

“The court’s aware that this is a huge issue and has huge financial implications,” said Tim Holbrook, associate dean at Emory University School of Law in Atlanta. The justices are “unwilling to disrupt the expectations of Myriad and other corporations.”

The case has ramifications for the growing field of personalized medicine as well as efforts to map the human brain and discover new uses for embryonic stem cells. It could also ripple well beyond medicine. Agricultural companies, including Monsanto Co. (MON:US), inject genes into seeds, and industrial microbiology businesses use microorganism DNA to improve biofuel manufacturing.

Innovation Concerns

Several justices asked whether barring gene patents would deter innovation by stripping companies of legal protection for their research.

Without a patent, “what does Myriad get out of this deal?” Justice Elena Kagan asked. “Why shouldn’t we worry that Myriad or companies like it will just say, ‘Well, you know, we’re not going to do this work anymore?’”

Justices Sonia Sotomayor, Stephen Breyer and Anthony Kennedy all asked about a middle ground suggested by the Obama administration. The government filed a brief saying the court should void parts of Myriad’s patents while leaving open the possibility that other aspects will be upheld.

The administration says Myriad isn’t entitled to a patent on “isolated DNA,” which the government says is merely a snippet of the genetic sequence as it appears in the body. The administration says Myriad might be entitled to a patent on so- called complementary DNA, which involves a greater level of human manipulation.

The administration’s stance marks a rejection of the longstanding policy of the U.S. Patent and Trademark Office, which has been awarding human gene patents since 1982.

Cookie Dough

Kennedy asked Myriad’s lawyer whether the administration’s approach would “give the industry sufficient protection for innovation and research.”

Complementary DNA, also known as cDNA, is a stripped-down version of the genetic sequence within the body, separating out the portion of the gene that can encode proteins.

Complementary DNA “is not a product of nature,” Sotomayor said. “It’s a product of human innovation.”

At the same time, Sotomayor signaled skepticism about patents on isolated DNA. She likened genetic sequences to the ingredients for chocolate-chip cookies.

“I can’t imagine getting a patent simply on the basic items of salt, flour and eggs, simply because I’ve created a new use or a new product from those ingredients,” she said.

Baseball Bat

Myriad’s lawyer, Gregory Castanias, said isolated DNA was more akin to a baseball bat carved from a tree. He said isolated DNA and the bat both are patentable because they require humans to determine exactly where to cut.

“A baseball bat doesn’t exist until it’s isolated from a tree,” he said. “But that’s still the product of human invention to decide where to begin the bat and where to end the bat.”

Chief Justice John Roberts said the isolation of DNA was less innovative than the creation of a baseball bat.

“Here you’re just snipping, and you don’t have anything new,” said Roberts, who once said judging was like being a baseball umpire. “You have something that is a part of something that has existed previous to your intervention.”

Drug and diagnostic companies are increasingly using DNA to design and target treatment for cancer and other conditions. Salt Lake City-based Myriad is one of the few companies that has used gene patents to keep its testing business exclusive.

Layers of Protection

Barring gene patents might affect biotechnology companies that hold such intellectual property, Biogen Idec Inc. (BIIB:US) Chief Executive Officer George Scangos said in an interview. Still, most biotechnology drugs are protected by several layers of patenting that include its protein structure, he said.

“I don’t think it’s a disaster” if the court rules against Myriad, he said. “We depend on intellectual property protection, and to the extent that we can’t get it to protect some of our discoveries, then it’s incrementally less attractive to do that.”

Even if the court rules against Myriad, the company would still have a viable testing business because of its vast database of mutations in the so-called BRCA1 and BRCA2 genes, said Robert Nussbaum, a University of California, San Francisco geneticist. Those mutations can indicate a higher risk of breast cancer.

Critical Issue

Myriad’s exclusive database is a “critical public-health issue,” Nussbaum said.

“Imagine if every radiology department in the country never shared their images with another radiologist,” he said in an interview. “It would be crippling.”

Myriad rose 55 cents, or 2.1 percent, to $26.65 yesterday in New York trading.

The case, which the court will decide by the end of June, is splitting the medical community. Trade groups for the biotechnology, agriculture and drug industries are siding with Myriad. They say gene patents have led to valuable treatments, including Amgen Inc. (AMGN:US)’s Epogen anemia drug and synthetic insulin developed by Genentech Inc., now part of Roche Holding AG. (ROG)

The challengers include the Association for Molecular Pathology, represented by the American Civil Liberties Union. The American Medical Association and the American College of Obstetricians and Gynecologists back the challenge.

Emotionally Charged

The dispute comes to the court in an emotionally charged package, with patient advocates accusing Myriad of standing in the way of breast cancer diagnosis and treatment. The company at one point demanded that the University of Pennsylvania stop clinical testing of cancer patients.

Critics say Myriad’s patents effectively give the company ownership rights over a part of the human body. Myriad says its patents haven’t prevented researchers from publishing thousands of papers on the genes.

The Myriad case has rekindled a debate over the longstanding concept that patents can’t cover “laws of nature.”

The case tests the meaning of that principle against the backdrop of medical and scientific research. In 1994, the company won a race among five research groups to pinpoint the genetic sequences associated with DNA mutations that indicate hereditary risk for breast and ovarian cancer. Myriad then developed tests for the mutations.

The ACLU lawyer challenging the Myriad patents, Christopher Hansen, said yesterday that researchers would continue to search for new natural phenomena, even without the prospect of patent protection.

‘Enormous Recognition’

Scientists who make important discoveries will get “enormous recognition,” he said. “We know that that’s sufficient. We know it’s sufficient with respect to these two genes. We also know it’s sufficient with respect to the human genome.”

That argument drew skepticism from Kagan. “We’re supposed to leave it to scientists who want Nobel prizes?” she asked.

Kennedy likewise signaled disagreement.

“I don’t think we can decide the case on the ground, ‘Oh, don’t worry about investment. It’ll come,’” he said.

The justices also wrestled with the line that separates nature from invention. Much of the discussion revolved around a hypothetical plant that has medicinal uses and is found only in the Amazon.

Breyer said the longstanding understanding is that someone could patent the process of extracting sap from the plant or the use of it to treat a disease.

“But what you can’t patent is the sap itself,” he said.

The case is Association for Molecular Pathology v. Myriad Genetics, 12-398.

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 editors responsible for this story: Steven Komarow at skomarow1@bloomberg.net; Bernard Kohn at bkohn2@bloomberg.net


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Companies Mentioned

  • MYGN
    (Myriad Genetics Inc)
    • $36.65 USD
    • 0.15
    • 0.41%
  • MON
    (Monsanto Co)
    • $121.44 USD
    • 0.47
    • 0.39%
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