The U.S. Supreme Court has this week invalidated Myriad’s Patent on isolated DNA of the BRCA-1 gene and its use in their breast cancer diagnostic tests. This comes as no surprise to many in the industry, but it is still a body blow to biotechnology and pharmaceutical companies around the world.

The U.S. decision in Association for Molecular Pathology v Myriad Genetics (the “U.S. Myriad decision”) has attracted worldwide attention. In Australia, these developments have been watched with particular interest in light of similar appeal proceedings recently initiated in the Australian Full Federal Court and due to be heard in August this year. Myriad successfully defended its Australian Patent in first instance proceedings in the Australian Federal Court. However, with one of the Applicants in Cancer Voices Australia v Myriad Genetics Inc. taking the case on appeal, the controversial issue of “gene patents” remains very much alive in Australia.

So will the Australian Full Federal Court come to the same conclusion as the decision of the U.S. Supreme Court? Not likely. The considerations of what constitutes a naturally occurring molecule are common to both lines of inquiry. However, technically speaking, the nature of the question asked of the U.S. Supreme Court is fundamentally different to that before the Australian Full Federal Court.

Question before the U.S. Court: framed in the negative

In the U.S., the Supreme Court was asked to consider whether the claimed isolated nucleic acid molecules are patentable or whether they fall within a class of subject matter that is excluded from patentability. Discoveries, laws of nature, natural phenomena and abstract ideas are not patentable subject matter in the U.S. The U.S. Court was asked to consider whether a naturally occurring segment of DNA is patent-eligible by virtue of its isolation from the rest of the human genome. The question was framed in the negative and asked whether isolated nucleic acid molecules fall within a defined class of concepts and phenomena that are excluded from patentability. The Court found that Myriad’s DNA claim fell within the law of nature exception.

Question before the Australian Court: framed in the positive

In contrast, the Australian Federal Court was asked to consider whether the claimed “isolated” nucleic acids comply with the statutory requirement of “manner of manufacture”, a uniquely Australian doctrine of Patent law. This is a positively framed question. The Australian Court was asked to consider whether the claimed “isolated” nucleic acids met a positive criterion for patentability.

The “manner of manufacture” requirement for patentability in Australian Patent law is set out in Section 18(1)(a) of the Patents Act 1990. In order to be patentable, Australian law requires an invention to be, inter alia, “a manner of manufacture within the meaning of section 6 of the Statute of Monopolies.” While the legislation does not provide a definition for this term, the Australian High Court has had the opportunity of clarifying the “manner of manufacture” requirement. In 1959, in the seminal decision of National Research Development Corporation v Commissioner of Patents (the "NRDC case"), the Australian High Court articulated the phrase “manner of manufacture” as including a product that consists in “an artificially created state of affairs which has economic significance”.

As the Applicants in the matter conceded the “economic significance” of the claimed invention, the sole question before the Australian Federal Court in the first instance was whether the “isolated” nucleic acid claimed by Myriad was “an artificially created state of affairs” sufficient to comply with the “manner of manufacture” requirement. In a clearly enunciated decision, the Australian Federal Court based its reasoning squarely on the NRDC case and ruled that an “isolated” nucleic acid exists outside of a cell and therefore, by definition, cannot exist within a cell. As a result of human intervention, the isolation of the nucleic acid had resulted in “an artificially created state of affairs” and so was a “manner of manufacture” within the meaning of the Patents Act 1990. Thus, “isolated” nucleic acids were confirmed to be patentable subject matter in Australia.

Will the U.S. Myriad decision affect proceedings in Australia?

For the Applicants to persuade the Australian Full Federal Court to deviate from the interpretation of the conclusions of the NRDC case, an Australian High Court decision held in high regard by the Courts, will be a tall order.

Essentially, the U.S. Supreme Court decision in the Myriad case is not expected to change the status quo in Australia. Naturally, the outcome of the pending appeal proceedings before the Australian Full Federal Court in Yvonne D’Arcy v Myriad Genetics Inc. is not guaranteed. However, since the negative nature of the question put to the U.S. Supreme Court is fundamentally different to the positive nature of the question on appeal before the Australian Full Federal Court, it is not expected to affect the outcome in Australia. It appears that for now at least, despite the furor over the recent U.S. decision in the Myriad case, it will be business as usual in Australia.