December 17, 2014

Myriad Disappointments for Biotech, but Hope Remains

CAFC extends the reach of subject-matter ineligibility under Myriad

Following Myriad Genetic’s 2013 loss at the Supreme Court (Ass’n for Molecular Pathology v. Myriad Genetics, 133 S. Ct. 2107 (2013), herein “Myriad SC”) regarding US 5,747,282 Claim 1, several competitors began to enter the market for BRCA-1 & -2 detection kits. Myriad responded by suing many of these market-entrants, asserting claims that had not been reviewed by the Supreme Court, and which were therefore still presumptively valid. In March 2014, the U.S. District Court for the District of Utah denied Myriad’s motion for a preliminary injunction against these market entrants. The district judge held that Myriad was unlikely to succeed on the merits because the newly asserted claims were all §101 ineligible under Myriad SC or Mayo Collaborative v. Prometheus Labs, 132 S. Ct. 1289 (2012). Myriad took an interlocutory appeal to the Federal Circuit to challenge the denial of a preliminary injunction. On 17 December 2014 the Federal Circuit affirmed the district court, holding that all asserted claims are §101 ineligible.

Myriad asserted two sets of claims: compositions (i.e. primer pairs that are capable of amplifying brca1 and brca2 sequences); and methods (i.e. using brca1 and brca2 specific probes and primers to diagnose a predisposition to breast and ovarian cancer). Neither of these sets of claims had previously been asserted, so they were not invalid as a matter of res judicata. Nevertheless, the Federal Circuit panel considered them analogous to the claims held invalid in Myriad SC.

Regarding the composition claims, the court noted (slip op. at 7) that the claimed “[p]rimers necessarily contain the identical sequence of the BRCA sequence directly opposite to the strand to which they are designed to bind.” Myriad had attempted to argue that, despite the sequence level identity, the primers were §101 eligible because, unlike gDNA, the primers had a new functionality—viz. the ability to prime sequence replication. However, the Federal Circuit declared that this function was not a “significant new function” (slip op. at 9) because “[o]ne of the primary functions of DNA’s structure in nature is that complementary nucleotide sequences bind to each other. It is the same function that is exploited here.”

This “significant new function” language hints that there might be a class of isolated natural molecules that can yet cross the §101 threshold. Discovery of a new function might support §101 eligibility of a natural extract, but only if the function is totally unrelated to the molecules function in its natural setting. In any event, the purported new function was not enough to make Myriad’s claims eligible in this case.

Meanwhile, Myriad had tried to distinguish the asserted method claims from both the compositions held invalid in Myriad SC and the methods held invalid in Mayo. In particular, Myriad noted that the Supreme Court had quoted Judge Bryson’s concurrence (Ass’n for Molecular Pathology v. USPTO, 689 F.3d 1303, 1349 (Fed. Cir. 2012), herein “Myriad FC1”) with approval (Myriad SC, 133 S. Ct. at 2120) to the effect that “as the first party with knowledge of the BRCA1 and BRCA2 sequences, Myriad was in an excellent position to claim applications of that knowledge.” This quote appeared to imply that at least some of Myriad’s claims for methods of using the brca1 and brca2 sequences should be §101 eligible.

The problem for Myriad, however, is that the particular method claims that it was asserting (Claims 7 & 8 of US 5,753,441) depend from a claim that had already been held invalid in Myriad FC1 as drawn to an abstract idea. Therefore, the current panel applied the two-step analysis from Alice Corp. v. CLS Bank, 134 S. Ct. 2347 (2014) to decide this case. Because these claims involve an abstract idea as a matter of res judicata that, the only question to be decided was whether the additional limitations from Claim 7 (hybridizing a brca1 probe) or Claim 8 (amplifying brca1 with specific PCR primers) add the magical “significantly more” necessary to define an “inventive concept.” The district court judge had found that hybridizing probes and PCR amplification were both “routine and conventional activity engaged in by scientists at the time of Myriad’s patent applications” (slip op. at 17). The Federal Circuit held that this sort of “routine and conventional” subject matter could not constitute the “significantly more” necessary to make the claims §101 eligible.

So far this is mostly depressing for biotech innovators, but the last three pages of the slip opinion do hold out some hope. Myriad had argued that Claims 7 & 8 were analogous to Claim 21, which Judge Bryson had singled out as probably eligible in Myriad FC1 (689 F.3d at 1349). Claim 21 was not asserted in the district court, and therefore was not properly before the Federal Circuit, so the circuit court was careful not to rule on Claim 21’s validity one way or another. The court did trouble itself, however, to distinguish Claim 21 on the grounds that Claim 21 is limited to probes specific for 10 particular mutations, rather than any brca1 allele (as in Claims 7 & 8). The Federal Circuit panel opined that “Claims 7 and 8 are significantly broader and more abstract [than Claim 21],” (slip op. at 19) because unlike the ten specified mutations of Claim 21 “the comparison step [in Claims 7 & 8] covers detection of yet undiscovered alterations, as well as comparisons for purposes other than detection of cancer. Even with respect to cancer, the comparisons are not limited to the detection of risk of breast or ovarian cancer” (slip op. at 15). In other words, there is at least some reason to hope that a claim limited to particular named sequences and particular named diseases or conditions might be eligible. This is not a holding that can bind future Federal Circuit panels, but it at least offers some limited guidance for biotech innovators and their patent lawyers.