Jeremy A. Cubert Partner VLP Law Group LLP

Inventors Need to Grapple with Developing New Strategies to Protect Biotechnology Innovations

The goose that laid the biotech patent golden egg is in trouble with the U.S. Supreme Court. Ironically, it was the Supreme Court that helped spur the industry with the watershed Charkrabarty ruling in 1980. But what has been giveth, can also be taken away. Beginning with the 2013 Myriad decision, the Supreme Court has stripped back eligible subject matter for so-called “products of nature,” raising doubts regarding whether any significant patent protection is left for biotechnology inventions. The trend continues as recently as June 27, 2016, when the Supreme Court let the Federal Circuit decision in Sequenom stand, resulting in claims directed to noninvasive prenatal screening of fetal DNA remaining a patent-ineligible subject. How do you align your business goals and intellectual property strategy in a new thicket of legal challenges?

Products of Nature and Patentable Subject Matter
Products of nature have never been entitled to patent protection under U.S. law. However, it has long been held that isolating these products from nature converts them into patentable subject matter, which is defined as a “new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” This principle was recognized in the Chakrabarty decision in relation to genetically modified “oil eating” bacteria because the “hand of man” changed the otherwise naturally occurring bacteria from their natural state into something man-made.

However, in the Myriad case, the Court held that there was no change made to claimed isolated genes, despite the effort and investment required to identify these genes from among thousands as genes predictive of an increased risk of breast cancer. The Myriad decision and follow-on decisions instead focus on whether any changes were made to the genes in question. It remains an open question as to whether the same reasoning will apply to other “natural products” such as proteins.

Another key Supreme Court decision stripped away patent protection for another area important to the biotechnology industry—diagnostic tests. In the Mayo decision of 2012, the Court held that claims directed to determining blood levels of a biomarker and using these levels to determine dosing of thiopurine drugs was not patent eligible because the correlation between the levels of the biomarker and the therapeutic efficacy of the drug was a “natural law.” Since, according to the Court, nothing was left to the claim after removing the “natural law,” the claim is invalid.

The Debate over Patentability

Without strong patent protection, it is difficult, if not impossible, to attract the investment needed to develop a drug or biologic through the FDA approval process. Is there anything left to patent?

The answer is yes.

There are strong feelings on both sides of the debate. One group strongly disagrees with the Supreme Court’s reasoning and the resulting policy of restricting patent protection for isolated products of nature and diagnostic methods. According to proponents of stronger patent protection, eliminating entire categories of patentable subject matter reduces or eliminates the incentive to invest in development of new treatments and diagnostic methods. This is especially true in view of the recently enacted regulatory scheme for biosimilar medicine.

Another group believes that the trend is positive because it opens up competition and spurs development of next-generation treatments resulting from modification of naturally occurring molecules. According to this group, the trend in the diagnostic market is toward using information technology and data mining platforms. Thus, firms are competing to develop the next-generation data mining and analysis platform at a rapid pace. According to this school of thought, patents are less important in such a dynamic field.

The Supreme Court’s analysis centers around identifying the natural phenomena (e.g., molecule, activity) and then analyzing whether the additional features provided by the invention are significant enough to go beyond what is already available in nature. Critics have argued that the Court is importing other patentability requirements like novelty and nonobviousness into the patentable subject matter analysis.

New Patent Strategies
Regardless of one’s point of view, inventors need to grapple with developing new strategies to protect biotechnology innovations. Note that in the scenarios discussed below, the inventions would still need to meet other criteria for patentability (e.g., novelty and nonobviousness). These strategies are directed to avoiding rejections based on lack of patentable subject matter. In each case, inventions related to natural phenomena must add significant value to what already exists in nature to pass the new patentable subject matter test.

First, with respect to “natural products” (e.g., DNA and proteins), inventors should consider making modifications to the molecules. This approach may be advantageous in many ways by improving efficacy, reducing toxicity, increasing bioavailability etc.

For example, improving stability of a molecule might be especially important when developing biologics. The resulting modified molecules should be considered patentable subject matter under the new law.

Combining two or more active “natural” products in a pharmaceutical formulation ought to also be considered patentable subject matter. However, inventors should consider whether the compounds interact naturally or work together in the body.

Second, with respect to diagnostics, inventors should consider employing novel biomolecules in diagnostic methods. For example, novel materials (e.g., antibodies) could be used in the diagnostic method to impart stronger patent protection and perhaps more predictable results.

Diagnostic methods related to personalized medicine may be considered patentable subject matter, especially if combinations of parameters are used in a new way—for example, combining a test for a biomarker in the blood with a screen for a particular genotype.

In each case, inventors and companies should seriously consider using trade secret protection where appropriate. This may be appropriate where particular methodologies are not easily detected by competitors and where the risk of rejection of the invention for lack of patentable subject matter is high. Trade secret law was recently strengthened through U.S. Congressional passage of the Defend Trade Secrets Act of 2016.

Despite a sea of changes, patent protection in biotech is still a valuable tool in developing your biotechnology business strategy. Modifying “products of nature” improves the chances of obtaining valuable patent protection, and may improve efficacy and bioavailability and reduce toxicity of the product. Modified drugs and biologics may also carve out a niche in a crowded market space or help identify new uses for old drugs. Understanding the changes in the law is critical to developing and implementing patent and intellectual property strategies in a rapidly changing market.

Jeremy A. Cubert  ([email protected]) is a partner at VLP Law Group LLP and is a member of the firm's Intellectual Property Practice Group. 

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