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  By Zeus! Prometheus ruling checks patents

 

CAP Today

 

 

 

June 2012
Feature Story

Anne Paxton

The biggest recent court ruling in patent law, the Mayo Collaborative Services v. Prometheus Laboratories, Inc. decision by the U.S. Supreme Court March 20, was cause for celebration by pathology and other medical groups. But it sent small shock waves through the patent law community and the biotechnology industry.

The judgment was unanimous, it was unequivocal, and in many quarters it was totally unexpected: Prometheus’ patents for its method of testing for metabolites of the drug thiopurine in patients with gastrointestinal disease were invalid, the high court held, because laws of nature are not patentable, and a process of recognizing and reciting a law of nature is not patentable either.

For pathology, Prometheus is a hugely significant ruling, says Jack Bierig, JD, partner with Sidley Austin in Chicago. “We have the first clear statement by the Supreme Court—and by a unanimous Supreme Court—that laboratory testing that really amounts to nothing more than an observation about the correlation between an analyte and a particular medical condition is not patentable.”

“There is a well-known distinction between laws of nature, which are not patentable, and applications of laws of nature, which are patentable. The question is where you draw the line between a law and an application. This is the first Supreme Court case that has addressed that question in the context of laboratory testing,” Bierig says.

In ruling that the two Prometheus diagnostic patents are invalid, the court overturned a ruling by the U.S. Court of Appeals for the Federal Circuit, which handles all patent cases, in Prometheus’ favor.

The dispute began after Mayo Medical Laboratories, in 2004, started using its own laboratory-developed test to measure concentrations of thiopurine drug metabolites in a patient’s blood. Prometheus sued for patent infringement, claiming that its patents covered researchers’ findings that identify correlations between metabolite levels and likely harm or ineffectiveness with precision. The Court of Appeals twice upheld Prometheus’ patents, even after being told by the Supreme Court to take a second look. With the Prometheus ruling, the Supreme Court has now invalidated the patents, siding with the CAP and several other medical groups that submitted friends-of-the-court briefs.

“People have long known the levels of these two metabolites are indicators of whether the dosage of thiopurine in a particular patient was proper or not,” Bierig says. “What was less well understood was the quantification of metabolite level. Prometheus (or the entity from which Prometheus bought the patent rights) basically discovered that the presence of 6-TG or 6-MMP below a certain concentration, namely 230 picomoles per 80 million red blood cells, indicates an inadequate dosage, whereas if the concentration of 6-TG is greater than 400 or of 6-MMP is greater than 7,000, the dosage is excessive. That’s an important correlation, but the Supreme Court has now said you cannot patent a test that amounts to nothing more than that observation.”

The impact of the Prometheus ruling appears to go far beyond invalidating the thiopurine patents. Six days after the ruling, the Supreme Court remanded the key breast cancer gene patenting case of Association for Molecular Pathology, et al. v. Myriad Genetics to the Court of Appeals, ordering that court to reconsider its 2011 ruling favoring Myriad in light of the Prometheus ruling. The Myriad case originated with a 2009 lawsuit by the American Civil Liberties Union, representing as plaintiffs the CAP, Association for Molecular Pathology, and other medical groups as well as patients and molecular pathologists, in a challenge of seven of Myriad Genetics’ patents on the BRCA1 and BRCA2 genes and methods for interrogating the genes. With the remand, the Myriad gene sequence patents are now looking “even more vulnerable,” says Roger D. Klein, MD, JD, a molecular pathologist and chair of the AMP Professional Relations Committee.

But apart from the Myriad case, the Prometheus ruling is likely to have an enormous impact on the validity of a gene patent type that is of critical importance to pathology practice now and in the future: so-called diagnostic method patents. “These are patents that claim ownership over associations between genetic variants and clinical phenotypes, such as diagnosis, prognosis, and responsiveness to therapy,” Dr. Klein says. Examples are a correlation patent involving the relationship between the FLT3 internal tandem duplication (ITD) and acute myeloid leukemia, the association of the JAK2 V617F mutation with myeloproliferative neoplasms, and patents covering mutations in the EGFR gene that predict responsiveness to anti-EGFR therapy in lung cancer.

The FLT3 ITD patent, used to qualify AML patients for bone marrow transplant, has been particularly problematic for pathologists, Dr. Klein says. “Enforcement of this patent has forced physicians and laboratories to split and geographically distribute irreplaceable bone marrow specimens, creating a risk of specimen loss and delaying return of patient results.” It has interfered with pathologists’ ability to provide comprehensive interpretations involving multiple diagnostic test procedures, and prevented them from implementing cost-saving algorithms that reduce unnecessary testing, he says. “There are an awful lot of these method patents out there, and they are going to become increasingly important in tissue-based cancer diagnostics. In my view, the Prometheus decision probably renders them invalid,” Dr. Klein says.

“We in the clinical lab industry have been delighted by the Prometheus decision, but it was not a genetic test case,” says Wayne W. Grody, MD, PhD, professor of pathology and laboratory medicine, pediatrics, and human genetics at the UCLA School of Medicine. “We don’t care that much about this one particular little drug owned by this one particular company. It’s the gene patents that are so universal. We really care much more about the impact of this case on Myriad and other cases that may come later.”

Since Myriad owns the BRCA patents, Dr. Grody says, “they are within their rights to not let anyone use it, and in general that’s what they’ve done. They’ve closed down other academic labs that were doing full sequencing of the BRCA genes, and those labs are additional plaintiffs in this case.” Two breast cancer patients are also plaintiffs. “They wanted second opinions to make sure their test result was right. And there’s no place to get it because Myriad is the only place doing the test,” says Dr. Grody, who is president of the American College of Medical Genetics and Genomics.

The fact that the Supreme Court remanded the Myriad case suggests that it feels that case, like Prometheus, may also hinge upon the notion of a correlation—the correlation between mutations in certain tumor suppressor genes and a high lifetime risk of cancer, Dr. Grody says. “When you read the Myriad patents, not only do they claim to own the information of the gene sequence, they also claim they are discoverers that certain mutations of those genes carry the risk of breast cancer. And that’s very similar to the correlation of thiopurine.”

“The Federal Circuit has said that these isolated BRCA genes are patentable, but in light of the Prometheus case, I’d say all bets are off,” Bierig says. “What will happen is the Federal Circuit will revisit its prior decision. It may reverse itself and hold the BRCA genes are not patentable, or it may adhere to its position and the Supreme Court will take the case. But I think there’s a decent chance that the Supreme Court could now rule that the product of the genome is basically a natural phenomenon. If you find some method of isolating the gene that no one has previously invented, you can patent the isolation method, but you can’t patent the gene.”

The next question, then, he says, will be “Once you have isolated the gene, is there something about comparing the isolated gene with the genetic material of individual patients that is patentable? Or is that just a sort of simple, straightforward application that people know how to do?”

The CAP, joining with the American College of Medical Genetics and Genomics, Association for Molecular Pathology, American Medical Association, American Society for Human Genetics, and Association of Professors of Medical and Human Genetics, filed an amicus curiae brief in support of Mayo Medical Laboratories in the Prometheus case. As a group, the organizations argued that Prometheus’ patents granted exclusive rights over the mere recognition that there is a natural statistical correlation between certain metabolite levels in the body, as measured by well-known means, and the potential toxicity and effectiveness of a well-known drug.

“If these patents remain in force,” the brief argues, “any physician who measures those metabolite levels, knows of the natural correlation, and thus is ‘warned’ that it might be advisable to adjust the dosage, becomes an infringer.” This would be the case even if the physician had measured the metabolites and considered their levels before the patents were issued.

In the Myriad case, the plaintiffs make similar arguments. Says Dr. Grody: “CAP’s members run clinical labs. They’re paid to make these correlations rather than just have a machine spit out a number that means nothing to the clinician. If we’re suddenly blocked from making that intellectual correlation, they are really interfering with the practice of medicine, and I think that’s what most of these groups are concerned about.”

But the medical groups also believe that the thiopurine monitoring patent should not be considered valid under patent law. The central question in the Prometheus case is whether the inventors discovered an actual diagnostic method or a biological relationship, Dr. Klein says. “In one sense, it may well be, to some extent, part of a method. It’s a means by which you can establish a correct dose. But it’s also definitely a biological relationship. Just because establishing the data took work and somebody hadn’t discovered it yet does not mean it’s patentable. And I think that was the key element in the Supreme Court’s decision.”

Dr. Klein, who (with Dr. Grody and Debra G.B. Leonard, MD, PhD) has assisted the ACLU with its arguments in the Myriad case, believes that what Prometheus was trying to reserve as a patented process is directly related to therapeutic drug monitoring.

“The patent is essentially a claim of ownership over the therapeutic reference range for thiopurine drugs. What Prometheus did went beyond statistically verifying a reference interval based on a distribution of results, as is routinely done in clinical laboratories for many analytes,” Dr. Klein says. “They needed to do a study, they needed to see at what levels people respond and what levels they have side effects. So I think it’s important work. It’s just in the realm of what I think academically oriented physicians do on a regular basis.” He compares patenting the product in such a case to running a clinical trial and patenting the results.

If the principle were extended to similar discoveries, it would also be costly, Bierig says. “Can you imagine if every time a researcher discovers a reference range that no one has really understood before, if he or she were able to patent that? It would really drive up lab testing costs a great deal. And it could inhibit further research that is built on the newly observed correlation.” The Supreme Court appeared to recognize some of those dangers in its decision when it quoted from the medical groups’ brief warning that Prometheus’ exclusive patents could result in a “vast thicket of exclusive rights over the use of critical scientific data.”

At the heart of the legal debate in both the Prometheus and Myriad cases is a set of competing views about the goals of a patent system, Bierig says. “On the one hand, you might say by giving people financial reward for discovering correlations, you’re encouraging them to do research that is necessary, to invest the time, money, and skills that are needed and to create new methods for use of those discoveries. Given the expense and uncertainty, the financial incentive of the patent laws is really necessary to encourage innovation.”

“Or, you could say, on the other hand, that patenting will raise the price of medical care, that it will impede medical advances making it very difficult for future researchers to do any work because they have to get all these licenses before they can do any work.”

The first view represents what Bierig calls the “commercial ethic,” and is reflected to some extent in patent law and in the Constitution. “The opposite view, of people discovering a correlation and publishing it and in effect donating it to the advancement of human kind, is more reflective of the medical or professional ethic first articulated in the Hippocratic Oath.” While both views are legitimate, he says, “at the end of the day one has to give way to the other, and the Supreme Court has come out very strongly in favor of the medical ethic.”

Basic patent law is summarized in section 101 of the U.S. Patent Act, which reads: “Whoever invents or discovers any new and useful process, machine, manufacture, composition of matter or any new and useful improvement thereof may obtain a patent,” Bierig points out. But the pivotal issue in the Prometheus and Myriad cases, and a crucial issue for the biotechnology industry, is at what point ideas to be considered for patent must be seen to fall into the category of laws of nature, natural phenomena, and abstract ideas, which are not patentable.

Cases going back to the 19th century have set various limits on what can be patented. Here, says Bierig, “the Supreme Court has said for the first time that just because you dress up a correlation in ‘method’ language isn’t enough to get a patent for it.” Dr. Grody has found that many patent attorneys involved with gene patenting still don’t see things that way: “You can ask them, ‘What if you discover a rock out in the field? Can you patent that?’ And what they might say is, ‘Not when it’s lying there, but if you took it up and brought it back to your factory to do something with it, some kind of transformation, that makes it patentable; it’s no longer what is found in nature.” The arguments of the Myriad lawyers all along, he says, have been precisely that.

Since Myriad permits an exemption from its exclusive patent for universities to do research, the company’s lawyers don’t understand why academics are objecting. Dr. Grody says, “They say, what are you complaining about? But we keep saying universities and medical schools also have clinical labs, and that’s where we’re blocked from using the gene.”

He also argues that if there is a sole provider like Myriad, with no peer review and obviously no proficiency testing, it’s impossible to know if they’re doing a good job. “They could have a systematic error that would go untested. And that’s especially true for genetic testing, because unlike measuring sodium or insulin levels, which are done repeatedly over the course of a disease, genetic tests are typically done once and never again. So you would never know if they made a mistake. Luckily, Myriad is a very good lab and they don’t make mistakes. But what if they were a bad lab? We would be in real trouble.”

To Dr. Grody, there is another central distinction that patent attorneys sometimes overlook. “Unlike every other patent I can think of, gene patents have no workaround. If someone patents a radio, someone can make a better radio. But if someone owns a gene, there is no other gene. That is the gene we need to access.”

Outside the U.S., the climate for exclusive patents like Myriad’s is not nearly so accommodating. “I know in the European Union, Myriad has not had much success when it’s gone to courts—they’ve ruled in favor of the labs,” Dr. Grody says. “And in Canada, there is a federal law stipulating that anything to do with cancer falls under the Canadian equivalent of the National Cancer Institute. The government must have these reagents to diagnose patients, so Canada has never recognized the patents either.”

In response to the Supreme Court decision, the Biotechnology Industry Organization (BIO) said that it “introduces new and confusing concepts into the traditional body of patent law, which patent examiners and lower courts will struggle to consistently and rationally implement.” BIO is also troubled that the court’s opinion “fails to appropriately recognize the importance of personalized medicine, and of the research and investment incentives needed to develop new individualized therapies for untreated diseases.”

But Dr. Klein believes the court has actually charted a less confusing direction for gene patenting; he is pleased to see the court affirm in the Prometheus case his belief that the correlations on which patents like Myriad’s are based are natural phenomena. “I don’t want to make any predictions about what the courts are going to do, but I think for diagnostic testing particularly, there is a strong analogy between the type of method patent that was found invalid in Prometheus and a patent on a gene sequence. I think the Prometheus ruling means a lot of diagnostic patents, including those covering gene variants, are, at their core, biological relationships and are not valid.”

Dr. Klein also rejects the idea that invalidating these patents will eliminate personalized medicine. “I think it will produce tremendous advancement and accelerate progress. Because what’s really lacking is knowledge. We have a human genome sequence and we have the ability to do whole genomes for around $1,000. What we don’t have is knowledge of how to apply the results; patenting prevents people from engaging in these activities. These are some of the few patents one can think of where you actually take things people are already doing and remove them, and prevent them from performing a medical activity in which they’re already engaged.

“So if biological phenomena cannot be patented, it opens the door for everyone to engage in the discovery of clinical relationships. It allows everybody to perform diagnostic testing that will result in newer and more effective methods.”

These diagnostic patent cases are capping a long period of liberalization of patents since the Court of Appeals for the Federal Circuit was created in 1982 so there would be a national patent court, Dr. Klein says. But, he notes, in 1980 the thinking about patents was different. “We were coming off a bad economic time in the 1970s. People were concerned we were losing ground globally. We didn’t seem to have a lot of money, and I think people felt intellectual property would be a key to future economic success.”

It was primarily two Supreme Court decisions some 30 years ago that have encouraged a broad reading of the patent laws, says Dr. Klein: Diamond v. Chakrabarty in 1980 and Diamond v. Diehr in 1981. Many patent attorneys and biotechnology companies especially saw the decision Diamond v. Chakrabarty, affirming the patent of a bacterium that digests hydrocarbons and was potentially useful for oil spills, as a signal that it would be clear sailing for gene patenting. “The Patent Office originally denied that patent, saying that you can’t patent living organisms, but the Supreme Court said no, anything made by man is patentable,” Dr. Klein says. Then, through a series of cases, “the Federal Circuit really liberalized patent rules and awarded a lot of patents that maybe in other times would not have been awarded.”

Partly as a result, the patent bar has believed for a long time that section 101 of the U.S. Patent Act lacked teeth, that patent eligibility was no longer a major concern, that its impact was essentially nil, says Dr. Klein. “They believed they could essentially draft around section 101.”

To some, Dr. Grody says, this pattern went to an alarming extreme in the 2006 case of Laboratory Corporation of America v. Metabolite Laboratories, Inc. “Metabolite claimed that drawing a correlation between levels of folate or vitamin B12 and levels of homocysteine in the blood—which is well known and has been studied backwards and forwards—is sort of owned by them. To me that was clearly a correlation, really a law of nature because it’s the way the body metabolizes things. They even said that for a doctor to merely read a lab value of a B-vitamin and correlate it in his head with homocysteine, you’re infringing on the patent, which seemed almost like mind control to me.” Nevertheless, the Supreme Court dismissed LabCorp’s appeal in Metabolite, though three of the justices wrote a dissent of the decision to dismiss. The CAP filed an amicus curiae brief in that case in support of LabCorp.

When the Myriad case arrived at the Federal Circuit Court of Appeals, that court’s 2011 ruling also showed a lack of consensus. It’s interesting, Bierig notes, that there were three judges on the panel and each wrote a separate opinion. “It’s fairly unusual to see each of three judges write a long opinion on the subject. So it’s proving to be very divisive within the Federal Circuit. It’s a very hard question they’re grappling with, and at the end of the day it comes down to these competing ethics and the policies that spring from those competing ethics.”

Dr. Klein, who was present at the Supreme Court oral arguments in the Prometheus case, was impressed by the justices’ overall level of understanding. “I didn’t know how it would come out, but by their questioning I could tell they were well briefed and I felt they understood the issues in the case.”

Rochelle Dreyfuss, JD, MS, a professor of patent law at New York University School of Law, was not particularly surprised at the Supreme Court’s apparently shifting ground in deciding that the Prometheus patents were invalid. “Justice Breyer said several years ago that in his opinion there were too many patents and they were beginning to slow the progress of science. So I think there were plenty of indications along the way that the Supreme Court was getting concerned.” What does surprise her is that the ruling is extremely broad. “Of course, everything is a law of nature. You can’t do anything that’s against nature.” She believes the court really didn’t give enough context for when a law of nature is invalid or when enough other things have been applied to a law of nature to enable a process to be patentable.

While Dreyfuss prefers not to use the term “lenient,” she says until now, the U.S. Patent Office has read case law as permitting the diagnostic patents, and has basically assumed the diagnostic patents were valid until the Supreme Court told them they were not. Dreyfuss, who directs the Engelberg Center on Innovation Law and Policy, points out the Patent Office gets quite a lot of patent applications. “They don’t have a lot of time for each one and have to examine them quickly, and sometimes they make a mistake, and that’s why these cases sometimes wind up in court. Now, however, they’re going to have to change their policy to recognize that, to be patentable, an innovation has to add something to a law of nature.”

There’s been tension between the Court of Appeals of the Federal Circuit, which reviews patenting, and the Supreme Court, Dreyfuss notes. “The Supreme Court keeps reversing what the Federal Circuit does, because it is not as pro-patenting, then the Federal Circuit ignores what the Supreme Court says.” She predicts the Federal Circuit will start chipping away at the Prometheus ruling. “The basic rule is you can’t patent a law of nature unless you’ve done something unconventional, so they will define ‘unconventional’ in ways that are much more permissive. The Supreme Court takes very few patent cases, but if they’re really unhappy with what the Federal Circuit is doing, in a few years they’ll take another one, and that might very well happen with the Myriad case.”

While there may not be an actual backlash against the biotechnology industry on the gene patenting issue, some observers suggest that the industry may have just gone too far. “The biotech community has really painted itself into a terrible corner,” Dreyfuss says. “Once upon a time, 20 years ago, we had pretty broad patents, but we also had limits on what patent holders could demand. We had sort of a general feeling that there was a cap on how much patent holders could expect from society as a whole.”

“Now the BIO has worked like crazy to get rid of every single one of those exceptions. So there’s no compulsory licensing, there seem to be no antitrust provisions, the federal government has gotten rid of the research exemptions, and now these people with biotech patents can charge as much as they want. There’s no diagnostic exemption, so they don’t have to allow for a second opinion. They can refuse to deal with you; if they don’t want to sequence your gene, it’s just tough luck for you. There’s just no limit on what they can do, and they’ve been fighting to keep it that way.”

The technological advances in gene sequencing over the past 20 years may also have made a turn of the tide more likely, Dr. Grody points out. “The Myriad lawyers say, ‘We haven’t patented genes that are inside your body. We pulled them out and cloned them and sequenced them.’ And that was true at the time in the early days of recombinant DNA when it was not easy to pull a gene out. But what I’ve been arguing since then is that BIO is trying to retain a horse that’s already out of the barn. That kind of gene cloning is now done by high school students in the lab, and the human genome sequence is on the Internet, free for anyone. So what’s the discovery or invention?”

A wild card in the gene patenting picture might be next-generation sequencing. “Some people think that because of the way many patents are written, many of the gene patents that exist will not be infringed if you are using next-generation sequencing technology,” says Dr. Debra G.B. Leonard, professor and vice chair of laboratory medicine, Weill Cornell Medical College, and chair of the CAP Personalized Health Care Committee.

“If you use next-generation sequencing, you do an entire genome, so you are not capturing any specific sequences. So you don’t need to design any probes related to the gene sequence that is patented.” While this distinction won’t apply to some of the more sweeping patents, they have different problems, she believes. “The most egregious patents basically state that any way you look at this gene sequence is an infringement of the patent—which is really reaching way too far in what a patent should be claiming.”

There remains the possibility that Congress could insert itself into the dispute and revise patent law, Bierig says. “In fact, I’m predicting that once the Supreme Court rules on these genetic patents—and maybe before that—we may see the biotech companies approaching Congress to revise the patent law, say, to explicitly state that isolated human genes are patentable.”

Dreyfuss would like to see Congress pass a law that allows gene patents but puts back the exceptions, which is basically the system employed in Europe for biotechnology. However, to some extent the exceptions are within the courts’ power to restore as well. “Every exception takes something away from patent holders’ potential market, but I think those markets are rich enough that we could protect universities’ ability to do research, patients’ ability to get second opinions, and so on.”

The Myriad case enters its next phase with oral arguments before the Federal Circuit scheduled for July 20. But resolution of the legitimacy of gene patenting, and within what parameters, is likely to take much longer. Getting rid of gene patents would be a rather radical and unlikely outcome, says Dr. Leonard, who believes that changing how gene patents are licensed makes more sense, since a lot of the problems around gene patents relate to enforcement. However, she says, “We cannot continue being limited in what we can use medically if we are going to move toward precision medicine. We just can’t. There has to be something that changes that allows us to use medically relevant information when it’s needed for managing patient care.”


Anne Paxton is a writer in Seattle.