As the industry awaits the Supreme Court’s decision regarding the patentability of genes, experts are reviewing the mid-April oral arguments for clues as to which way the court is leaning. Court watchers speculate based on oral arguments in the Association for Molecular Pathology, et al. v. Myriad case that the Supreme Court may try to find a middle ground in which it denies the patentability of isolated genomic DNA but accepts that synthesized cDNA is a human construct, and thereby patentable. This halfway position, which was argued by the U.S. solicitor general in court (and seemingly well received by some of the justices) and in an amicus brief, marks a clear departure from the position previously taken by the U.S. Patent and Trademark Office. Aside from the product-of-nature argument, one theme that penetrated questioning was a seeming unease about the economic and scientific consequences of the court’s decision, with concern for maintaining adequate incentives to propel innovation. This concern, while echoed by many in the life sciences industry, may be overstated, experts say, as there are not many successful companies built around existing single-gene patents. “Beyond personalized medicine’s potential interest in the Myriad outcome . . . the significance of […]
As the industry awaits the Supreme Court’s decision regarding the patentability of genes, experts are reviewing the mid-April oral arguments for clues as to which way the court is leaning. Court watchers speculate based on oral arguments in the Association for Molecular Pathology, et al. v. Myriad case that the Supreme Court may try to find a middle ground in which it denies the patentability of isolated genomic DNA but accepts that synthesized cDNA is a human construct, and thereby patentable.
This halfway position, which was argued by the U.S. solicitor general in court (and seemingly well received by some of the justices) and in an amicus brief, marks a clear departure from the position previously taken by the U.S. Patent and Trademark Office. Aside from the product-of-nature argument, one theme that penetrated questioning was a seeming unease about the economic and scientific consequences of the court’s decision, with concern for maintaining adequate incentives to propel innovation. This concern, while echoed by many in the life sciences industry, may be overstated, experts say, as there are not many successful companies built around existing single-gene patents.
“Beyond personalized medicine’s potential interest in the Myriad outcome . . . the significance of the case is probably overrated,” writes John Conley, Kenan Professor of Law at the University of North Carolina, Chapel Hill, and counsel with Robinson, Bradshaw & Hinson (Charlotte) in the Genomic Law Review blog. “Going forward, single-gene patents are going to be hard to get regardless of this decision because of a stricter obviousness standard. And . . . newer sequencing technologies may be able to avoid using patented single genes in isolation, which would avoid Myriad-style patents entirely. So the Supreme Court’s decision will attract huge, if not hysterical, academic and public interest, but the market may already have moved beyond it.”
Even Myriad Genetics (Salt Lake City), whose BRCA1 and BRCA2 genes are at the center of this case, is shying away from a reliance on patents in its strategic planning. Nonetheless, the case has put some pressure on Myriad’s stock.
“We expect the stock will continue to be volatile around the court case and debate will remain around Myriad’s ability to compete as technology moves to whole genome sequencing,” writes Amanda Murphy, an analyst at William Blair & Co., in a research note. “Still, we ultimately believe that the company’s proprietary variant database provides a meaningful competitive advantage beyond Myriad’s intellectual property and that potentially competing platforms may take longer to pervade the clinic (providing the same level of accuracy and VUS rate at a meaningfully lower cost) than some expect.”
