Over the years, medical technologies have transformed many previously untreatable diseases. They are usually very expensive to develop but relatively cheap to reproduce. Without the protection conferred by a patent, it would not be economically viable for organisations to continue investing in research and product development. Striking an appropriate balance between encouraging medical innovation and enabling access to it is complex and has been the subject of much debate among policymakers, health activists and the private sector.

According to section 18(2) of the Patents Act 1990 (Cth), human beings, and the biological processes for their generation, are not patentable inventions.

But what about genetic material?

The High Court’s decision

Yesterday, the High Court ruled that isolated genes cannot be patented in Australia.

Why is this decision significant?

This is landmark decision for Australian patent law because it significantly increases the clarity of the boundary between what is and what is not patentable subject matter.  Not only has the High Court provided guidelines for lower courts regarding the assessment of whether or not a claimed invention falls within the established concept of a manner of manufacture, but it has also now left it in the hands of the Australian Parliament to determine whether patents can be granted for isolated genes.

Only time will tell whether the decision will slow down the development of or access to new drugs.

The proceedings

The proceedings brought against Myriad Genetics concerned a test for breast cancer. Without getting into the medical jargon, the process involves isolating an individual’s BRCA1 gene, comparing it with a synthetic version of a healthy BRCA1 gene and determining whether there are differences that may indicate a mutation that could increase that individual’s predisposition to breast cancer.  Since it can predict the likelihood of whether breast cancer will occur in a person before symptoms arise, it has obvious benefits to society.

Myriad Genetics, the developer of this process, invested a great deal of time and resources into developing it.  Rather than patenting the process, Myriad Genetics patented the genetic coding of the mutant strands that indicate an individual’s increased predisposition to breast cancer.  Such patents, if they were found to be valid, would have granted Myriad Genetics (and its Australian licensee, Genetic Technologies Ltd) an exclusive right to use this coding in BRCA1 to diagnose this genetic predisposition to breast cancer.

The decision at first instance

Proceedings challenging this patent were originally brought by Cancer Voices Australia, a community action group that supports cancer victims.  It argued that the isolated genes are no different to the genes which occur naturally in the human body, meaning that they cannot be patented.  However, the Court found at first instance that, amongst other reasons, “it would lead to very odd results” if Myriad Genetics was not able to benefit from its labours in perfecting the process, and so upheld the patent.

The appeal to the Full Court of the Federal Court

Cancer survivor, Yvonne D’Arcy, appealed that decision to the Full Court of the Federal Court.  All five judges on the bench dismissed the appeal, finding that there was a difference between the isolated gene and the gene that occurred naturally in the human body, as their functions (replicating cells as opposed to detecting anomalies) were sufficiently different.

The Full Court also specifically excluded all relevant policy, moral and social considerations, as it considered these to be outside the realms of what they were able to consider when coming to a decision.

This effectively meant that, until yesterday, patents regarding human genetic material that had been isolated were valid.  This was consistent with the position in the European Union, which does not exclude isolated genes under Article 53 of the European Patent Convention (although it does include an exemption for “diagnostic methods practised on the human or animal body”).  However, it was inconsistent with the position adopted by the US Supreme Court in Association of Molecular Pathology v Myriad Genetics Inc, which considered similar patents claimed in the US.

The High Court’s reasoning

In the majority judgment, Chief Justice French and Justices Kiefel, Bell and Keane found that Myriad Genetics could not enforce its patent.  Their Honours provided a two-step process for determining whether or not something should be patented:

  1. Whether a claimed invention should be considered a “manner of manufacture”.  Whether something is a manner of manufacture requires, at a minimum, an artificially created state of affairs.

  2. If it is not, the court should determine whether, for policy reasons, the claimed invention should nevertheless fall within the ambit of a patentable invention.

Although Myriad Genetics had ‘made’ the genes insofar as it undertook a complicated process to isolate them, this was not a manner of manufacture.  The important part of the isolated gene was not the isolated gene itself, but the information that it contained.  This information was not created by Myriad Genetics.  Rather, it was information that exists naturally within the human body which Myriad Genetics was able to discern.  The information was not made, nor was it artificially created.  Instead, it was discovered by a matter of chance.  The effort that went into making this discovery did not create the information, but rather made it available for use.  Therefore, the claimed patent was not to be considered a manner of manufacture, as there was no artificial element to the patented material.

Accordingly, their Honours moved onto the second step. It was held that because the number of potentially patented genetic sequences was indeterminate (but likely large) and one could easily infringe the patent without being aware that they were doing so, there was a risk that enforcing the patent would lead to a chilling effect on future research into this important area.