CHICAGO - Day two of 2010 Biotechnology Industry Organization convention kicked into high gear, and amid the early morning offerings was a panel session on gene patenting that its host dubbed "incredibly timely."
An understatement, to say the least.
The industry has been buzzing with speculation since the March 29 ruling by federal district Judge Robert Sweet that invalidated patent claims related to the BRCA1 and BRCA2 genes held by Myriad Genetics Inc. and the University of Utah Foundation, stating that genes are not patentable because they occur in nature. (See BioWorld Today, March 31, 2010.)
In its argument, Salt Lake City-based Myriad had claimed such as ruling would "unravel the foundation of the entire biotechnology industry." Somewhat mixed metaphor aside, it is an issue that could have far-reaching implications to the biotech IP landscape, though the specific challenges it presents for the molecular diagnostics space could be worrisome to companies and investors on a more near-term basis.
Genetic companies like Myriad made their names - and attracted investments - based around their patent portfolios. No IP protection means no business, and Michael Henry, vice president of business development of Athena Diagnostics Inc., stated the obvious in a late Monday biomarker panel: "If you can't recoup your investment, you stop investing."
Henry and other speakers on the panel, titled "Commercialization of Biomarkers," painted a potentially bleak picture of the molecular diagnostics space while the Myriad case - also the pending Bilski case relating to the patentability of business methods - hovers overhead.
Simon Smith, of UK-based Taverner's law firm, said he wouldn't be surprised if companies put off acquiring new biomarker IP, at least until industry experts can gain clarity on the impact of the Myriad and Bilski cases. He said he recently represented a biotech looking to acquire some biomarker IP from a university, and "we ended up walking away due to the IP uncertainty."
One audience member said it succinctly: "We see the entire IP environment in considerable jeopardy."
How it got there is an interesting story in itself.
Unlike most patent invalidation rulings, the Myriad case did not start with allegations of infringement. Instead, a group of plaintiffs, including the American Civil Liberties Union, individual patients and genetic testing companies, simply filed suit, asking that the BRCA cancer gene patents be invalidated.
"There's been no trial," noted John Whealan, associate dean for IP law studies at the George Washington University Law School. If the ruling is upheld, it could set a precedent allowing anyone to "just pick a patent you don't like" and ask the courts to invalidate it, he told a standing-room-only crowd during Tuesday morning's session, titled "Patenting Genes: In Search of Calmer Waters."
"The procedural process is as interesting as the merits," Whealan said. In terms of merits, however, he added that it "would be interesting" if Myriad could have shown the judge the actual work that went into isolating the genes.
After all, several members of the audience pointed out, genes may exist in nature, but without human interference to isolate them, they are diagnostically useless.
"The truth is the identification of BRCA1 took a huge amount of work," one attendee said. "It's not like somebody walked along the sea front, picked up a stone and say, 'Oh, this is cool.'"
As for Myriad, it intends to appeal Sweet's ruling in the Court of Appeals for the Federal Circuit. In the meantime, however, the case could pose one more hurdle in the advancement of personalized medicine, which health care systems have been quick to praise yet slow to adopt.
Athena's Henry remarked that at least one of the cancer patients in the Myriad case filed suit because her insurance company didn't cover the BRCA genetic test provided by the company.
"Sometimes, I think [some of the plaintiffs] blame gene patenting on things that have nothing to do with patents," he said. "Don't blame gene patents for a problem with U.S. health care as a whole."