Today’s landmark decision by the High Court in D'Arcy v Myriad Genetics Inc & Anor  HCA 35 (7 October 2015) essentially prohibits patent protection for human genetic material and genetic sequences. The decision reverses the 15 February 2013 Full Federal Court ruling, which found that United States company Myriad Genetics Inc’s (Myriad) patent on the isolated BRCA1 gene, associated mutations and utilisation of the sequence for diagnostic purposes was valid.
In D’Arcy v Myriad Genetics Inc  FCAFC 115, the Full Federal Court of Australia’s unanimously held that Myriad Genetics Inc’s patent claims regarding particular isolated BRCA1 gene were patentable subject matter in Australia. The Full Court held that the ‘isolated’ nucleic acids (Invention) was chemically, structurally and functionally different from a nucleic acid inside a human cell. The nucleic acids had been ‘isolated’ in the sense that the naturally occurring materials were extracted from the cells, thereby creating an artificial state of affair for economic benefit. On this basis, the Full Court found that the Invention was a ‘manner of manufacture’ and thereby patentable. This decision was at odds with the leading U. S. Supreme Court’s decision of 2013 that similar patent claims were invalid, on the basis that such claims were to a ‘product of nature’ and were therefore not patentable.
High Court’s decision
Today, the High Court unanimously allowed the appeal from the decision of the Full Court of the Federal Court and held that the BRCA1 gene was not a ‘patentable invention’ within the meaning of s 18(1)(a) of the Patents Act 1990 (Cth) (Act). Section 18(1)(a) of the Act requires that, for an invention to be patentable, it must be ‘a manner of manufacture’ within the meaning of s 6 of the Statute of Monopolies.
The High Court held that, having regard to the relevant factors, an isolated nucleic acid, coding for the BRCA1 protein, with specified variations, is not a manner of manufacture. Although it may be said that the Invention claimed might be, in a formal sense, a product of human action, it was the existence of the chemical information stored in the relevant sequences that was an essential element of the Invention as claimed. That information is the same information as that contained in the DNA of the person from which the nucleic acid is isolated and cannot properly be said to have been manufactured.
The Court also considered that to attribute patentability to the Invention would involve an extension of the concept of a manner of manufacture, which was not appropriate for judicial determination.
Where to now?
This decision raises important concerns about the impact on gene-based medical therapies and life sciences industry at large.
Our patent system is based on the premise that patent exclusivity is needed to promote invention and innovation. This is the basis on which supporters of gene patenting have long contended that patents for human genes will have a positive effect on genetic innovation, research and development in the private sector. Restricting patent protection for biological inventions may therefore undermine incentives for a wide range of entities to invest in biotechnology companies, which may ultimately hinder progress in research and development. Further, restricting the patentability of human genetic material has the potential to not only impact investment and commercialisation in the domestic biotech industry, but also foreign investment in Australia.
While this decision has brought the Australian position in line with the US position, its effect on investment and commercialisation in Australia is yet to be seen. It will be important for biotechnology companies to understand how this decision impacts their research and commercialisation going forward.
While this ruling provides some certainty on the criteria that we might use to decide whether something is patent-eligible, the decision may leave some room for patents on genetic material that have been further isolated from the natural occurring substances or organisms.