Introduction

For over 150 years the Supreme Court has provided three categories of exceptions to patent eligibility under 35 U.S.C §101: abstract ideas, laws of nature, and physical phenomena, since these are the basic tools of scientific and technological work.[1] The Roberts Court has revised the standard for review of “abstract ideas” and “laws of nature” in Bilski v. Kappos and Mayo v. Prometheus, respectively. The Court’s much awaited decision in AMP v. Myriad addressed the “physical phenomena” exception with respect to patents claiming isolated DNA.[2]

The recent decision in Myriad will have an impact reaching far beyond the patentability of isolated DNA. Patent eligibility for isolated DNA is crucial for the continued growth of the biotechnology and diagnostics industries. The decision, disallowing patenting of isolated DNA, will have a chilling effect on these industries. Furthermore, the decision casts a cloud on the validity of thousands of issued patents and pending applications. In contrast. the application of the holding by the lower courts broadening the exception for natural products in general would have had an even wider impact in industries such as those involving petroleum products and natural product-derived pharmaceuticals. While the unanimous decision by the Supreme Court carefully avoided a broad new directive, its application by the lower courts and the Patent and Trademark Office is yet to be resolved. The decision, which will be discussed in more detail below, disallowed the patenting of “isolated DNA” while finding that cDNA is patent eligible. The decision is an implicit rejection of obviousness-type analysis in patent eligibility determination for products of nature.

The significance of the issues raised in the Myriad case is evident from the number of amicus briefs submitted in the case and the diversity of the parties submitting them.[3] Many amici expressed concern about reduced investment and research in the biotechnology industry that may result from lack of patent protection for isolated DNA and other biological products, while others expressed public policy concerns about increased cost and impediments to research.[4] Some of the amici were concerned about the ethical issues involved in patenting genetic code.[5] This review focuses on the legal principles involved in the patent eligibility question and the procedural history of the case.

A review of the significant cases as well the history of AMP v. Myriad will provide the necessary background to understanding the evolution of the “products of nature” doctrine. The recent decisions in Bilski and Prometheus have addressed the patentability of business methods and method of treatment claims.

In Bilski, the Court rejected the use of the “machine-or-transformation” test as the sole analytical tool for determining patentability of method patents. In rejecting the “machine-or-transformation” test, the Court stated that, “[it] is unaware of any ordinary, contemporary, common meaning of “process” that would require it to be tied to a machine or the transformation of an article.” While the Court’s ruling allows for patenting of business methods without tying the methods to a machine or transforming an article, the claimed method in Bilski was rejected as being directed to patenting an abstract idea. The Court concluded that the claims were directed to patenting both the concept of hedging risk and the application of that concept to energy markets. In the Court’s view, the claims merely explained the basic concept of hedging by reducing it to a mathematical formula which it considered as an unpatentable abstract idea. Claims that included limitations to energy markets were considered token post-solution activity that were not significant enough to render the unpatentable abstract idea of hedging patentable.[6] With respect to claims directed to hedging that were limited to the energy market, the Court looked at the claim elements apart from the abstract idea to determine if the additional elements were merely post-solution activity. The “use of well-known random analysis techniques to establish some of the inputs into the equation” was found not significant enough to render the claims patent eligible.[7] The Court’s decision in Bilski was followed by its unanimous decision in Mayo v. Prometheus.[8] The claims in Prometheus were directed to processes that help doctors determine whether the used concentrations of thiopurine drugs were too low or too high. In the Court’s view, the relationship between the concentration of thiopurine metabolites in the blood and the likelihood that the drug dosage will be ineffective or harmful represented a natural law, and additional steps in the claims did not transform the natural law to a patent-eligible process. The Court held that the additional steps apart from the natural laws themselves need to be more than “well-understood, routine, conventional activity previously engaged in by researches in the filed” to render the claims patent eligible.[9] The Court further stated that, “simply appending conventional steps, specified at a high level of generality, to laws of nature, natural phenomena, and abstract ideas cannot make those laws, phenomena, and ideas patentable.”[10]

While Bilski and Promethus involved process patents, the claims at issue in Myriad are directed to product claims. There are several seminal cases in Supreme Court jurisprudence that set out a framework for analyzing product claims for patent eligibility. The most significant of these cases is Diamond v. Chakrabarty, decided by the Supreme Court in 1980. In Chakrabarty, the researchers discovered a process by which four different plasmids, capable of degrading four different oil components, could be transferred to and maintained stably in a single Pseudomonas bacterium, which itself has no capacity for degrading oil.[11] The Court held that the claims were directed “not to a hitherto unknown natural phenomenon, but to a nonnaturally occurring manufacture or composition of matter—a product of human ingenuity “having a distinctive name, character and use.’”[12] The presence of new characteristics was the distinguishing factor in comparison with the mixture of bacteria that were held ineligible in Funk Brothers v. Kalo.[13]. In contrast, the bacterium in Chakrabarty exhibited markedly different characteristics from those found in nature, and thus, meeting the threshold standard for patent eligibility.

The question of whether isolated natural products were patent eligible was considered in several lower court decisions.[14] In a decision by Judge Learned Hand, Parke-Davis, a purified form of adrenaline was held patentable since the purification results in a product with such distinct characteristics that it becomes for every practical purpose a new thing commercially and therapeutically.[15] The decision in Parke-Davis was followed by the Court in Merck v. Olin in finding a purified form of Vitamin-B12 patentable. Referring to the concentrated purified form, the Court stated that “it did not exist in nature in the form in which the patentee produced it and was produced by them only after lengthy experiments.” Furthermore, “every step in the purification of a product is not a patentable advance, except, perhaps, as to the process, if the new product differs from the old ‘merely in degree, and not in kind.’”[16] In the case of Vitamin-B12, the purified product resulted in a new utility, which could not have carried out without purification. Since the difference was one in kind, rather than in degree, the purified product was found patent eligible.

The patent challenge to Myriad’s BRCA1 and BRCA2 was spearheaded by American Civil Liberties Union (ACLU) and a set of plaintiffs including the Association for Medical Pathology. The patent challenge also raised questions about whether some of the plaintiffs had standing to challenge the patent. This paper reviews the patent eligibility question without focusing on the other issues raised in the litigation. The initial suit was brought in the District Court for the Southern District of New York (S.D.N.Y). A review of the procedural history of the decision is given below.

District Court (S.D.N.Y) Decision

Plaintiffs, the Association for Molecular Pathology et al. brought a declaratory judgment (DJ) action against Myriad and the USPTO in the S.D.N.Y. They challenged 15 claims of 7 of Myriad’s patents covering isolated BRCA1 and BRCA2 DNA and related diagnostic methods. The first patent applications covering isolated BRCA1 DNA were filed in August 1994. These patent applications also covered method claims directed to diagnostic tests. The first patent applications covering isolated BRCA2 DNA and related methods were filed one year later. Myriad asserted the patents against the plaintiffs and against other parties. Myriad sent cease-and-desist letters to doctors and made license offers. Myriad also litigated the patents against various parties before The Association for Molecular Pathology brought its DJ action.

Below is independent claim 1 of U.S. Patent No. 5,747,282, which is representative of the composition claims to isolated DNA:

  1. An isolated DNA coding for a BRCA1 polypeptide, said polypeptide having the amino acid sequence set forth in SEQ ID NO: 2.

There were also claims directed to cDNA.

On Summary Judgment, Judge Robert W. Sweet invalidated the patents. He held that isolated DNA is not patentable as it is merely a product of nature. He did not distinguish cDNA (lacking introns) from genomic DNA (having introns). He held cDNA was not “markedly different” from genomic DNA. He held that “not only are the coding sequences contained in the claimed DNA identical to those found in native DNA, the particular arrangement of those sequences is the result of the natural phenomena of RNA splicing.”[17]

Judge Sweet explained his reasoning by arguing that “the information encoded by DNA reflects its primary biological function.”[18] He also stressed that “DNA, and in particular the ordering of its nucleotides, therefore serves as the physical embodiment of laws of nature—those that define the construction of the human body”[19]

Also at issue were method claims containing “comparing” and “analyzing” language. Below is a representative claim with “analyzing” language (claim 1 of U.S. Patent No. 5,709,999):

  1. A method for detecting a germline alteration in a BRCA1 gene, said alteration selected from the group consisting of the alterations set forth in Tables 12A, 14, 18 or 19 in a human which comprises analyzing a sequence of a BRCA1 gene or BRCA1 RNA from a human sample or analyzing a sequence of BRCA1 cDNA made from mRNA from said human sample…

Below is a representative claim with “comparing” language (claim 1 of U.S. Patent No. 5,710,001):

  1. A method for screening a tumor sample from a human subject for a somatic alteration in a BRCA1 gene in said tumor which comprises [] comparing a first sequence selected from the group consisting of a BRCA1 gene from said tumor sample and BRCA1 cDNA made from mRNA from said tumor sample with a second sequence selected from the group consisting of …

Judge Sweet held the “analyzing” and “comparing” claims invalid under §101 applying the Bilski machine or transformation test. Judge Sweet argued that “the involvement of the machine or transformation in the claimed process must not merely be insignificant extra-solution activity.” He distinguished Myriad claims from those of Prometheus, which the Federal Circuit had held were patentable due to a “transformation.”

Below is a representative claim with “screening” language (claim 20 of U.S. Patent No. 5,747,282):

  1. A method for screening potential cancer therapeutics which comprises: growing a transformed eukaryotic host cell containing an altered BRCA1 gene causing cancer in the presence of a compound suspected of being a cancer therapeutic, growing said transformed eukaryotic host cell in the absence of said compound, determining the rate of growth of said host cell in the presence of said compound and the rate of growth of said host cell in the absence of said compound and comparing the growth rate of said host cells, wherein a slower rate of growth of said host cell in the presence of said compound is indicative of a cancer therapeutic.

Judge Sweet held that claim 20 sought to patent a basic scientific principle: that a slower rate of cell growth in the presence of a compound indicates that the compound may be a cancer therapeutic.[20] In his opinion, the recited transformative steps represent “nothing more than preparatory, data-gathering steps to obtain growth rate information and do not render the claimed mental process patentable under §101.”[21] The district court decision was appealed to the Court of Appeals for the Federal Circuit.

Federal Circuit Decision

In a majority opinion written by Justice Lourie, the court stressed that what made isolated DNA patent eligible was its distinctive nature, rather than its physiological use or benefit. The court distinguished isolated DNA from the genetic information encoded by it, thus expressing its disagreement with Judge Sweet’s analysis.

The court also disagreed with the Solicitor General’s “magic microscope” analysis. The Solicitor General had proposed such a test, where if the claimed isolated molecule could be seen by a user to focus on the same DNA portion in the nucleus as in the isolated DNA, then the isolated DNA could not be patentable. The court stressed that isolated DNA was cleaved from its native chromosome, and was thus different than genomic DNA.

In discussing the method claims with “analyzing” and “comparing” language, the court concluded that those claims were not patent eligible because they covered only an abstract mental step. Relying on Bilski v. Kappos, the court argued that “the prohibition against patenting abstract ideas cannot be circumvented by attempting to limit the use of the formula to a particular technological environment.

The ACLU filed a petition asking the Supreme Court to review the case. On March 26, 2012, after the Mayo v. Prometheus decision came out, the Supreme Court granted certiorari, vacated the Federal Circuit’s judgment and remanded the case to the Federal Circuit for further consideration in light of Mayo v. Prometheus.

Federal Circuit on remand after Mayo v. Prometheus

On appeal to the Federal Circuit, the District Court ruling was partially reversed. The majority of the court, in an opinion written by Justice Lourie, concluded that “the challenged claims to isolated DNAs, whether limited to cDNAs or not, are directed to patent-eligible subject matter under §101.” The majority held that the claims cover molecules that are markedly different—have a distinct chemical identity and nature—from molecules that exist in nature. According to the majority, isolated DNA is not merely purified DNA.

Regarding the “comparing” and “analyzing” method claims, the court held: “We conclude that Myriad’s claims to “comparing” or “analyzing” two gene sequences fall outside the scope of §101 because they claim only abstract mental processes.”[22] In other words, the court held that those claims were not patentable.

The court held that the method claims directed to screening potential cancer therapeutics via changes in cell growth rates were patentable under §101. The court held that the claims included a transformation step: growing transformed cells in the presence or absence of a potential cancer therapeutic. The court also thought that the claims included a “determining” step in that it involved physical manipulation of cells.[23]

Justice Moore joined the majority with respect to isolated cDNA sequences but only concurred in the judgment with respect to isolated DNA. She argued that “the claimed cDNA sequences do not exist in nature.” However, she expressed some reservations: “If I were deciding on a blank canvas, I might conclude that an isolated DNA sequence that includes most or all of a gene is not patentable subject matter.” (emphasis added).[24]

Supreme Court Oral Arguments:

Oral Arguments took place on Monday April 15, 2013. Christopher Hansen appeared on behalf of the ACLU. Donald Verrilli, the Solicitor General, appeared for the United States as amicus curiae. Gregory Castanias appeared on behalf of Myriad Genetics.

Mr. Hansen argued that Myriad did not invent anything because the BRCA1 and BRCA2 genes were made by nature, not by Myriad.[25] Mr. Hansen argued that extracting a natural product is insufficient to confer patentability. In response to questioning by Justice Roberts regarding whether one can patent a process for extracting naturally occurring things, Mr. Hansen responded that such a process would be eligible for patentability, but that such a process was not the subject of the patents at issue.

Throughout the oral arguments, several analogies were made to isolated DNA. In one such analogy, Mr. Hansen argued that if you pick a leaf off a tree and swallow it because it has some additional value, then it is not patentable. Justice Alito then asked him what if the value of the leaf was extracted and reduced to a concentrated form. Mr. Hansen conceded that that may well be patent eligible because “you have now taken what was in nature and you’ve transformed it in two ways. First of all, you’ve made it substantially more concentrated than it was in nature; and second, you have given it a function.”[26]

Justice Kagan expressed concern over the implications of rendering isolated DNA patent ineligible asking “Why shouldn’t we worry that Myriad or other companies like it will just say, well, you know, we’re not going to do this work anymore?”.[27] Mr. Hansen countered by arguing that “the whole point of the product of nature doctrine is that when you lock up a product of nature, it prevents industry from innovating and—and making new discoveries.”[28]

The discussion then moved on to cDNA. Justice Sotomayor questioned why Mr. Hansen would argue that cDNA is not patent eligible because there are structural differences between cDNA and genomic DNA. Justice Sotomayor went so far as to state that “it is not a product of nature; it’s a product of human invention.”[29] Mr. Hansen argued that cDNA was not markedly different from what was found in nature, but Justice Sotomayor countered that the issue should then be obviousness and not patent eligibility.[30]

The oral argument of Donald B. Verrilli for the United States then took place. He argued that isolated DNA is patent ineligible because it is simply native DNA extracted from the body.[31] He also explained that the position of the United States is that cDNA is patent eligible because “it is an artificial creation in the laboratory that doesn’t correspond to anything in your body.”[32] Chief Justice Roberts questioned whether the court ought to focus on patentability at the eligibility stage or at the obviousness stage.[33]

The oral argument of Gregory A. Castanias on behalf of Myriad then took place. Justice Sotomayor presented him with an analogy between patentable subject matter and a chocolate chip cookie made using natural ingredients: salt, flour, eggs and butter. However, she argued that “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.”[34]

Mr. Castanias countered that isolated DNA is not analogous to a natural product because “there was invention in the decision of where to begin the gene and where to end the gene. That was not given by nature.”[35]

Mr. Castanias then offered his own analogy: ‘A baseball bat doesn’t exist until it’s isolated from a tree. But that’s still the product of human invention to decide where to begin the bat and where to end the bat.”[36] Chief Justice Roberts was not convinced by this analogy and argued that making isolated DNA was very different to making a baseball bat because to make isolated DNA all that was involved was “snipping.”[37] Mr. Castanias countered that “you wouldn’t even know where to snip until the Myriad invention.”[38]

Mr. Castanias also stressed that the patent eligibility of isolated DNA was a 30-plus year practice that the Patent Office, despite the position of the Solicitor General, continues to follow. Mr. Castanias ended by repeating that isolated DNA involved more than mere “snipping” because the sequence claimed in claim 1 of the ‘282 patent was not created by snipping. He was not allowed to elaborate due to time constraints.

Overall, from the questions posed by the Justices, it would seem that they struggled with the notion of the patent-eligibility of natural products. Their analogies to breaking a leaf off a tree, to the ingredients for making chocolate chips cookies, to a natural product isolated from a plant in the amazon, all point to their general belief that isolated DNA is merely a natural product that has been isolated from the human body, much as a kidney or a gallbladder may be isolated when harvested for transplantation. However, several Supreme Court justices indicated from their line of questioning that they may be favorable to the notion of the patent-eligibility of cDNA because the creation of cDNA involves further manipulation than the isolation of genomic DNA.

Supreme Court Decision:

On June 13, 2013, in an opinion drafted by Justice Thomas the Supreme Court held that “a naturally occurring DNA segment is a product of nature and not patent eligible merely because it has been isolated, but that cDNA is patent eligible because it is not naturally occurring.”[39] The court first recited the three exceptions to patentable subject matter that are listed in Mayo: Laws of nature, natural phenomena and abstract ideas.[40] The court focused on the Chakrabarty decision for guidance. The court explained that the bacterium in Chakrabarty was held to be patent eligible because it was new “with markedly different characteristics from any found in nature,”[41] The court distinguished the situation in Chakrabarty from that in Funk Brothers Seed Co. v. Kalo Inoculant Co., 333 U.S. 127 (1948) where the court held that a composition comprising a mixtures of nitrogen-fixing bacteria was not patent eligible because the patentee did not alter the bacteria in any way.[42]

The court held that the mere discovery of the location of the BRCA1 and BRCA2 genes was not sufficient to make the genes patent eligible subject matter under §101. To the court, the fact that Myriad’s claims, in their eyes, merely recited a sequence, and were not expressed in terms of chemical composition, was fatal to patent eligibility. The court concluded that the Myriad claims focused on the genetic information in the BRCA1 and BRCA2 genes, rather than on the structure of the DNA molecule. Also, the court did not consider that merely breaking the chemical bonds that held the stretch of claimed DNA connected to the rest of the chromosome was sufficient to make the composition “markedly different” from what was found in nature.

The court did not give deference to the USPTO’s determination that isolated DNA was patent-eligible, because it weighed it against the United States’ argument at the Federal Circuit and before the Supreme Court that isolated DNA was not patent eligible.[43]

The court then turned to the issue of whether cDNA is patent eligible. The court explained that cDNA comprises a DNA molecule devoid of introns, which is not naturally-occurring, but is rather made by a lab technician.[44] The court therefore concluded that cDNA is not a product of nature and is thus “patent eligible under §101, except insofar as very short series of DNA may have no intervening introns to remove when creating cDNA. In that situation, a short strand of cDNA may be indistinguishable from natural DNA.”[45]

The finding of patent eligibility for cDNA is clear indication that the Supreme Court did not adopt an obviousness-type analysis akin to the holdings in Mayo and Bilski. If the analysis was to deem what is discovered to be in the prior art and to determine if what is claimed was merely routine and conventional, then cDNA would have unlikely met that test. The eligibility for cDNA is a clear indication that what is required is not the obviousness-type analysis, but rather the elucidation of some difference from what exists in nature. Thus, the decision is an implicit rejection of the obviousness-type analysis found in Mayo. Instead, the Supreme Court took a direct comparison approach in deciding that the differences in “isolated DNA” was merely incidental to isolation while cDNA is something “unquestionably new.”[46] The Court did not find the argument that “the nucleotide sequence of cDNA is dictated by nature” to be persuasive in determining patent eligibility. While the sequence may be dictated by nature, cDNA itself is “unquestionably new.” The decision, moored in the Chakrabarty decision is based on differences in “distinctive name, character [and] use.” The Court found that cDNA, while being dictated by the sequence existing in nature, is distinct from what exists in nature.

Importantly, the court stressed that the decision did not implicate method claims because there were none before the court. The court also noted that the case did not involve patents on new applications of knowledge about the BRCA1 and BRCA2 genes. The court also made clear that it did not consider the patentability of DNA in which the order of the naturally occurring nucleotides had been altered, and expressed no opinion on the subject.[47] The court concluded by stating that “[w]e merely hold that genes and the information they encode are not patent eligible under §101 simply because they have been isolated from the surrounding genetic material.”[48]

Justice Scalia concurred in part and concurred in the judgment, but acknowledged that he was unable to affirm the “fine details of molecular biology” on his own knowledge or belief, but agreed that isolated DNA was identical to the same portion of DNA in its natural state, and that cDNA is a synthetic creation not normally present in nature.

The opinion thus focused on the Chakrabarty inquiry of whether a composition is “markedly different” from that found in nature. The court concluded that an isolated DNA was not markedly different from the same DNA as found in nature merely because the DNA backbone had been cleaved in order to isolate it. The decision also seems to render claims to a short sequence that is identical to that found in nature patent ineligible. This would seem to make claims to primers patent ineligible, if the primer has a sequence that is identical to that of the genomic DNA.

Although the court held that cDNA covering a sequence from which introns had been deleted, and only exons remained, was patent eligible, it made clear that cDNA covering a sequence that comprised only exons and from which no introns had been removed, so that the sequence of the cDNA was identical to that of the genomic DNA, was not patent eligible.

However, the court did not opine on whether other modifications to an isolated DNA, such as a point mutation, would render it patent eligible. Other issues which remain unaddressed by the court are how this decision affects the patent eligibility of other biological compositions, such as proteins, antibodies or chemical molecules such as vitamins, steroids etc. If they are also to be judged under the “markedly different” standard, how much of a modification will be needed in order to render the natural product patent eligible? Will a point mutation be enough? How about a post-translational modification carried out in the laboratory that does not normally occur in nature? These are all issues that remain to be clarified by the courts in the future. Only then will the full impact of this decision become clear.

The decision is also important for what it doesn’t include. The decision did not adopt the preemption doctrine argued by the appellants. An adoption of the preemption doctrine would have had a broad implication since claims other than ones directed to isolated DNA can have wide restrictive impact. In fact, the finding of patent eligibility for cDNA can be considered as an implicit rejection of the preemption doctrine.

The decision’s affirmance of Chakrabarty is also supportive of a broad view of patent eligibility. While the isolated DNA itself was found not patent eligible, the reliance on Chakrabarty will allow for patent eligibility for other natural product derived products. However, it is likely that the differences between a new product and the natural product will need to be more than minimal. For example, breaking the bonds of a long naturally occurring polymer will not likely be sufficient to confer patent eligibility to a molecule excised therefrom.

Roy Issac