In a decision handed down on 7 October 2015, the High Court has unanimously allowed the appeal from the decision of the Full Federal Court in D’Arcy v Myriad Genetics Inc.  FCAFC 115 (see our article dated 8 September 2014).
In this surprise decision, the court held that claims 1 to 3 of the Myriad patent directed to isolated nucleic acids coding for mutant or polymorphic forms of the BRCA1 polypeptide do not meet the requirement of manner of manufacture and are inherently non-patentable. In reaching this decision the court concurred with the reasoning of the U.S. Supreme Court in Association for Molecular Pathology v Myriad Genetics Inc. that the information stored in the relevant sequences is an essential feature that is not modified simply because the molecules have been isolated. The court noted that the claims in question cover a “very large, indeed unquantified” class of isolated nucleic acids bearing the requisite information, and that allowing patent protection for this class risks “a chilling effect upon legitimate innovative activity outside the formal boundaries of the monopoly”. A further factor in the decision is the court’s view that “if the claims are properly the subject of a patent, the patent could be infringed without the infringer being aware of that fact”.
What is the meaning of Myriad?
The High Court decision has certainly expanded the patentable subject matter manner of manufacture test. However, the majority judgement doesn’t specifically address the issue of patentable subject matter with respect to naturally occurring compounds (other than nucleic acids) or artificial nucleic acids, and it is unclear if the decision could be extended to gene technologies more generally to exclude naturally occurring chemicals, ICT inventions and other new technologies from patent protection.
In an attempt to temper the uncertainty associated with this decision, IP Australia issued a Consultation Paper that outlines how it intends to modify its examination practice in view of the decision. Accordingly, IP Australia has adopted a relatively narrow interpretation of the decision based upon what it interprets as the primary finding of the court, namely that “a claim to an isolated nucleic acid that merely represents information coding for a polypeptide is not patent eligible”. As a result, the examination practice of IP Australia is proposed to be altered such that claims directed to the following will not be considered patent eligible:
- Naturally occurring (human) nucleic acid sequences encoding polypeptides or functional fragments thereof – either isolated or synthesised;
- Naturally occurring (non-human) nucleic acid sequences encoding polypeptides or functional fragments thereof – either isolated or synthesised;
- Naturally occurring human and non-human coding RNA – either isolated or synthesised.
Although there is considerable conjecture about the possible impact of the High Court decision in future patent litigation, at least some commentators suggest that the effect of the decision should be limited to a prohibition on patent protection of naturally occurring human nucleic acids. The proposed examination practice by IP Australia clearly adopts this approach, providing a practical and sensible application of the decision which will be welcomed by the Australian biotechnology industry.