The U.S. District Court for the Southern District of New York recently held that certain claims of Myriad Genetics' patents covering two breast cancer susceptibility genes were invalid, ruling that isolated gene sequences and diagnostic methods using such gene sequences are not patentable subject matter.[1] This broad decision, set against the political backdrop of the healthcare reform debate, has generated discussion not only within the legal and scientific communities, but among the general population as well.

The case involves two genes, BRCA1 and BRCA2. Variations in these genes are associated with increased incidence of breast and ovarian cancer. Myriad owns patents to the isolated gene sequences for BRCA1 and BRCA2, as well as to diagnostic methods using the sequences to assess a patient's cancer risk. Myriad's BRCA1/BRCA2 diagnostic tests are widely used and resulted in revenues of $222 million in the U.S. in 2008.

The court outlined the central policy compromise of the patent system – whether a time-limited monopoly is a fair trade and a sufficient incentive for the development and disclosure of innovative science – which takes on a particular poignance in the context of cancer research. The court also mentioned, but declined to address, whether the Myriad patents would satisfy the novelty and non-obviousness requirements of 35 U.S.C. §§ 102-103. Although the policy and patentability issues seemed to eclipse all others in the public arena, the sole legal question addressed by the court was whether the isolated DNA sequences and the diagnostic methods constituted statutory subject matter under § 101.

Composition Claims: Isolated DNA Sequences

With respect to claims directed to isolated DNA sequences, the court held that isolated DNA did not exhibit "markedly different characteristics" from the corresponding native DNA, as it occurs in the human genome. Rather, the claimed isolated DNA was merely a purified product of nature which, without more, is not patentable. Furthermore, the Court stated that discovering the correlation between gene structure and function, while bestowing immense scientific and commercial value, was insufficient to render the gene patentable. A newly discovered natural principle, e.g., an inherent property of a composition already existing in nature, does not render the composition patentable.

The district court cited two Supreme Court cases and decided that Myriad's claims to "isolated DNA" were more analogous to a claimed mixture of several naturally-occurring bacteria that was held unpatentable by the U.S. Supreme Court in Funk Brothers, than to a non-naturally occurring, engineered microorganism that was held patentable by the Court in Chakrabarty.[2]

The district court's holding with respect to the composition claims is controversial because of its potentially wide-reaching effects across multiple fields of use (e.g., research, diagnostic, therapeutic) and its apparent contradiction of established positions taken by both the USPTO and the Federal Circuit.

In addition, the district court decision gives substantial weight to the proposition that DNA is different from other chemical compounds in that it conveys encoded genetic information. In contrast, the Federal Circuit, while not wholly ignoring DNA's role as a vehicle of information, has treated DNA as a chemical compound.[3] It is likely that the Federal Circuit will continue to treat DNA as a chemical compound and accordingly, give more substantive weight to the structural distinctions between isolated and native DNA to reverse the district court's holding that "isolated DNA" is unpatentable.

Method Claims: Diagnostic Methods that "Analyze" and "Compare" Sequences

With respect to the method claims, the court held that the claimed steps of "analyzing" and "comparing" DNA from a biological sample were mental processes that failed to meet the "machine or transformation" test set forth by the Federal Circuit in In re Bilski.[4] In Bilski, the Federal Circuit held that a business method claim having only computational or mental steps ("initiating" market transactions and "identifying" participants) was not patent eligible subject matter.

The Bilski "machine or transformation" test was applied to a therapeutic method in Prometheus, where the Federal Circuit held that a step of "determining metabolite levels" was "transformative," because the "levels cannot be determined by mere inspection."[5] But the district court in AMP distinguished Prometheus and held that Myriad's steps of "analyzing" and "comparing" are directed only to abstract mental processes. The court dismissed Myriad's arguments that the steps necessarily include extracting a biological sample such as blood or tissue and isolating the DNA, viewing such activities as un-claimed preparatory steps or alternatively, mere data gathering steps.

Whether the Federal Circuit adopts the district court's distinction between the method claims in Prometheus and those in this case is questionable. Moreover, since Bilksi is now before the Supreme Court, a determinative issue may be whether the Bilski "machine or transformation" test is adopted by the Supreme Court.