December 1, 2009 (Vol. 29, No. 21)
John P. Iwanicki
Fraser D. Brown Ph.D.
Did the Supreme Court Tip Its Hand in Favor of Diagnostic Method Patents?
It has been almost 30 years since the Supreme Court last addressed patentable subject matter. That case, Diamond v. Chakrabarty, is celebrated as ushering in the entire biotechnology industry. On November 9, 2009, the Supreme Court heard arguments in Bilski v. Kappos, a case that could undermine patents in the life science industry.
Bilski v. Kappos is the appeal of In re Bilski, a Federal Circuit case that addressed the fundamental question of what constitutes patent-eligible subject matter under Section 101 of the Patent Act. According to Bilski, a method is patent-eligible if it is “tied to a particular machine or apparatus” or transforms a particular article into “a different state or thing.”
Although Bilski involved technology in the financial services industry, the “machine or transformation” test announced by the Federal Circuit is widely viewed as a rigid test that applies to all technologies, and it is already being used to invalidate patents involving life science diagnostic methods. Methods that require correlation of information to diagnose a particular disease or condition that neither include a “machine or apparatus” nor transform a particular article into “a different state or thing” may make the patent claims susceptible to an attack under Bilski.
Inconsistent Federal Circuit Rulings
Two cases illustrate Bilski’s reach. In Classen Immunotherapies, Inc. v. Biogen Idec, the Federal Circuit affirmed the lower court decision of invalidity of the following claim for being nonstatutory subject matter: “A method of determining whether an immunization schedule affects the incidence or severity of a chronic immune-mediated disorder in a treatment group of mammals, relative to a control group of mammals, which comprises immunizing mammals in the treatment group of mammals with one or more doses of one or more immunogens, according to said immunization schedule, and comparing the incidence, prevalence, frequency or severity of said chronic immune-mediated disorder or the level of a marker of such a disorder, in the treatment group, with that in the control group.”
The Federal Circuit strictly applied the rigid machine or transformation test in a one-liner: “Dr. Classen’s claims are neither ‘tied to a particular machine or apparatus’ nor do they ‘transform a particular article into a different state or thing.’”
In Prometheus Labs, Inc. v. Mayo, the court invalidated the following claim largely based upon Bilski. “A method of optimizing therapeutic efficacy for treatment of an immune-mediated gastrointestinal disorder comprising: (a) administering a drug providing 6-thioguanine . . . and (b) determining the level of 6-thioguanine in said subject . . . and (c) wherein the levels of 6-thioguanine greater than about 400 pmol per 8×108 red blood cells indicates a need to decrease the amount of said drug subsequently administered to said subject.”
The Prometheus claim is directed to determining a level of an administered drug and correlating the level of the drug with a need to decrease subsequent amounts of the drug. No particular machine or apparatus, or transformation of a particular article into a different state or thing, is recited in the claim. And the court determined that because the human body transformed the drug through natural processes, the invention remained nothing more than the discovery of a natural correlation.
However, the Federal Circuit reversed on appeal, holding that both the administering and the determining steps of the claim contained transformations sufficient to pass the Bilski test, Prometheus Labs v. Mayo. The court reasoned that administering a drug results in a transformation of the human body, and this transformation is essential to the claim’s purpose of treating a disease.
However, the court’s holding that the determining step is also transformative may prove to be more important to diagnostic tests, particularly where diagnosis is based solely on measuring levels of naturally occurring diagnostic targets. Determining levels of the drug, 6-thioguanine, required manipulation because the levels could not be determined by mere inspection. The court characterized this manipulation as a transformation of physical substances sufficient to pass the Bilski test.
Thus, under Prometheus, it appears that any processing required to measure levels of a substance in a sample from the body is sufficient to pass the Bilski test. The question now is whether the Supreme Court’s decision in Bilski v. Kappos will affect the Prometheus test as applied to diagnostic methods.
The transcript from the oral argument on November 9, 2009, suggests that the Supreme Court understands its decision could have broad implications for technology other than what was at issue in Bilski. Justice Sotomayor noted that “Once you announce an exclusive test, you’re shoe-horning technologies that might be different [from Bilski].”
Justice Sotomayor suggested limiting the ruling to business method patents only, but then acknowledged “I have no idea what the limits of that ruling will impose in the computer world, in the biomedical world, all of the amici who are talking about how it will destroy industries?” Justice Sotomayor then invited counsel for the government, which supported the machine or transformation test before the Federal Circuit, to “help us with a test that doesn’t go to the extreme the Federal Circuit did.”
Against the backdrop of the oral argument, the Supreme Court can take several routes. They can affirm the machine or transformation test, reverse Bilski without comment, or provide their own guidance that attempts to harmonize Supreme Court precedent. A simple affirmance seems unlikely because many of the Justices questioned why simply including a machine could or should transform a process into patentable subject matter.
Further, Justice Sotomayor’s comments beg for a test different from machine or transformation. And little will be gained by the Supreme Court’s grant of review if they simply reverse Bilski and remand.
It seems more likely that the Supreme Court will provide some guidance as to patent-eligible subject matter based on prior Supreme Court precedent. However, the particular facts of Bilski offer the Court the option to resolve the case with a narrow ruling focused either on Bilski or on business method patents generally. It is possible that guidance in other technological areas might await future Supreme Court activity.
The Supreme Court was petitioned recently to hear appeal of Prometheus Labs v. Mayo, which may be a better case for exploring how Section 101 applies to diagnostic methods. And, as Justice Ginsburg noted, “this [Bilski] case could be decided without making any bold steps.”
John P. Iwanicki ([email protected]) is a senior shareholder, and Fraser D. Brown, Ph.D. ([email protected]), is an associate at Banner & Witcoff. Web: www.bannerwitcoff.com.