On 13 June 2013, the United States Supreme Court ruled in Association for Molecular Pathology v. Myriad Genetics ("Myriad") that:

For the reasons that follow, we hold 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.

This unanimous decision, which reversed the Federal Circuit's decision that isolated DNA sequences are patent eligible, is significant for the biotechnology industry.

The Court rejected the views of the U.S. Patent and Trademark Office and the U.S. Court of Appeals for the Federal Circuit. The Court accepted that Myriad made a "medical breakthrough" in identifying and isolating the BRCA1 and BRCA2 genes used in a diagnostic test to predict a likelihood of developing breast or ovarian cancer. The issued patent claims were based on a discovery that mutant versions of these genes can indicate an increased risk of breast and ovarian cancer. However, the Court held that "groundbreaking, innovative, or even brilliant discovery does not by itself satisfy" patent eligibility and "separating (a) gene from its surrounding genetic material is not an act of invention".

The Court ruled that isolated DNA is not patent eligible

The Court stated that while the identification of the location of the BRCA1 and BRCA2 genes within the human genome is a significant discovery, "that discovery, by itself, does not render the BRCA genes 'new...composition[s] of matter'". The Court ruled that isolating naturally occurring DNA, which involves the breaking of covalent bonds holding the sequence in place, is a process that does not satisfy the patent eligibility standard.

The Court ruled that cDNA is patent eligible

The Court held:

cDNA cannot be isolated from nature, but instead must be created in the laboratory . . . because the introns that are found in the native gene are removed from the cDNA segment.

Impact on Myriad Genetics, Inc.

Myriad charges $3,340 for its genetic test and sales from the test account for the bulk of Myriad's USD496 million revenue last year. Myriad shares rose on the ruling but ended the day down 5.6% at USD32.01.

In a statement from Myriad, Peter D. Meldrum, president and CEO said:

Importantly, the Court noted that many of Myriad's unchallenged claims are method claims applying knowledge about the BRCA 1 and BRCA 2 genes. While these method claims were not at issue in this case, the Court highlighted Federal Circuit Judge Bryson's opinion that, "[a]s the first party with knowledge of the [BRCA1 and BRCA2] sequences, Myriad was in an excellent position to claim applications to that knowledge".

We believe the Court appropriately upheld our claims on cDNA, and underscored the patent eligibility of our method claims, ensuring strong intellectual property protection for our BRACAnalysis test moving forward.

Impact on method and application claims

The Court made it specifically clear what was not implicated by its decision when it said:

First, there are no method claims before this Court. Had Myriad created an innovative method of manipulating genes while searching for the BRCA1 and BRCA2 genes, it could possibly have sought a method patent. But the processes used by Myriad to isolate DNA were well understood by geneticists at the time of Myriad's patents "were well understood, widely used, and fairly uniform insofar as any scientist engaged in the search for a gene would likely have utilized a similar approach," 702 F. Supp. 2d, at 202–03, and are not at issue in this case. Similarly, this case does not involve patents on new applications of knowledge about the BRCA1 and BRCA2 genes. Judge Bryson aptly noted that, "[a]s the first party with knowledge of the [BRCA1 and BRCA2] sequences, Myriad was in an excellent position to claim applications of that knowledge. Many of its unchallenged claims are limited to such applications." 689 F. 3d, at 1349.

Nor do we consider the patentability of DNA in which the order of the naturally occurring nucleotides has been altered. Scientific alteration of the genetic code presents a different inquiry, and we express no opinion about the application of §101 to such endeavors. We 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.

Broader Implications

The decision will likely cause the invalidation of a number of patents which claim naturally occurring DNA segments. Synthetic DNA probes and diagnostic assays should still meet the criteria of patent eligibility although the relationship between the Myriad decision and the Supreme Court's earlier decision, Mayo Collaborative Services v. Prometheus Laboratories, 132 S.Ct. 1289 (2012) as it applies to diagnostic assays, does provide some uncertainty. The US Supreme Court decision is reported in Association for Molecular Pathology v. Myriad Genetics, Inc. U.S. (2013) (Thomas, J.).

The Australian Position

In Australia, the Australian Federal Court (which is a first instance Australian judicature; the highest being the Australian High Court) ruled on 15 February 2013 that isolated DNA is patent eligible. The decision is reported in Cancer Voices Australia v Myriad Genetics Inc [2013] FCA 65. The decision has been appealed to the Full Federal Court of Australia.