Genetic Technologies Ltd. v. Merial L.L.C. : Gene-Based Assays in the Wake of Mayo

I. Background

The case concerned a discovery by Genetic Technologies (hereinafter GTG) that noncoding segments in an individual's genome are correlated with specific allelic sequences found adjacent to, or remote from, the noncoding sequences. ⁵ By amplifying a selected region of intron DNA and analyzing its sequence, conclusions could be drawn regarding the haplotype of an individual and used diagnostically. ⁶

GTG filed its first patent application on its technology for identifying alleles in 1990 and, through a series of continuations and continuations-in-part, received U.S. Patent 5,612,179 on March 18, 1997. In 2011, it brought an action for infringement of the '179 patent against several companies, including Merial, LLC. ⁷ In response, Merial filed a motion to have the case dismissed because the claims asserted by GTG failed to meet the requirements for patent-eligible subject matter. This motion was granted by the district court and GTG then appealed the dismissal to the Federal Circuit. ⁸

II. Review and Analysis

There was only a single claim in GTG's appeal, which read as follows:

1. A method for detection of at least one coding region allele of a multi-allelic genetic locus comprising:

a) amplifying genomic DNA with a primer pair that spans a non-coding region sequence, said primer pair defining a DNA sequence which is in genetic linkage with said genetic locus and contains a sufficient number of non-coding region sequence nucleotides to produce an amplified DNA sequence characteristic of said allele; and

The Federal Circuit proceeded to analyze this claim using the “well-established two-step test for patent eligibility” provided by the Supreme Court ¹⁰ in its Alice ¹¹ decision. The first part of the test was described by the Supreme Court as follows: “First, we determine whether the claims at issue are directed to one of those patent-ineligible concepts. … If so, we then ask, what else is there in the claims before us?” ¹²

Thus, analysis begins with an examination of whether a patent claim is directed to patent-ineligible subject matter (laws of nature, natural phenomena, or abstract ideas) or includes such subject matter as an element. The rationale for this provided by the Supreme Court is that the recitation of this subject matter raises a danger of excessive preemption (i.e., a danger of broadly and unacceptably preventing access to the subject matter by others due to its being present in a patent claim). ¹³

Determination of whether subject matter identified in the first step of the test renders a claim ineligible is addressed in the second part of the test:

To answer that question, we consider the elements of each claim both individually and as an ordered combination to determine whether the additional elements transform the nature of the claim into a patent-eligible application. … We have described step two of this analysis as a search for an “‘inventive concept’”—i.e., an element or combination of elements that is sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself. ¹⁴

The search for an “inventive concept” mentioned in the above quote would seem to be more suitable to an evaluation of the novelty and nonobviousness of a claim than to patent eligibility, and has its origins in much earlier Supreme Court cases. The most notable of these is Funk Bros. Seed Co. v. Kalo Inoculant Co., ¹⁵ a case decided in 1948, four years prior to the 1952 revisions in patent law, and at a time when courts often mixed together different criteria of patentability. ¹⁶ Funk Bros. was concerned with an inoculum made up of several strains of bacteria that had been isolated and then combined based on their not interfering with one another's ability to fix nitrogen in certain types of plants. ¹⁷ In parts of this decision, the concepts of obviousness and patent eligibility are so mixed together that it is difficult to tell which the Court is discussing. For example, on page 131, the Court says:

Even though it [the inoculum] may have been the product of skill, it certainly was not the product of invention. There is no way in which we could call it such unless we borrowed invention from the discovery of the natural principle itself. That is to say, there is no invention here unless the discovery that certain strains of the several species of these bacteria are non-inhibitive and may thus be safely mixed is invention. But we cannot so hold without allowing a patent to issue on one of the ancient secrets of nature now disclosed. All that remains, therefore, are advantages of the mixed inoculants themselves. They are not enough. ¹⁸

The approach taken by the Court in Funk Bros. was also followed in Parker v. Flook, ¹⁹ a case in which the patent-ineligible subject matter took the form of a mathematical algorithm used as part of a method in controlling chemical reactions. Here, the Supreme Court stated:

Respondent's process is unpatentable under § 101, not because it contains a mathematical algorithm as one component, but because once that algorithm is assumed to be within the prior art, the application, considered as a whole, contains no patentable invention. Even though a phenomenon of nature or mathematical formula may be well known, an inventive application of the principle may be patented. Conversely, the discovery of such a phenomenon cannot support a patent unless there is some other inventive concept in its application. ²⁰

It should be noted that the algorithm referred to is assumed to be part of the prior art and this is simply because it is, when considered in isolation, patent-ineligible subject matter. The fact that the algorithm may not have actually been known previously and that, when taken in combination with other claim elements, it might produce an invention that is novel and nonobvious, plays no part in the analysis. The conclusion from this case, when taken together with Funk Bros., is that patent eligibility is not judged by looking at an invention as a whole and asking whether there is a counterpart in nature that is substantially the same, ²¹ but rather by identifying one or more elements in a claim corresponding to a law of nature and then, in an approach generally similar to an obviousness analysis, asking if other claim elements embody an “inventive concept.” ²²

Although the tests for patent eligibility and obviousness may appear to have similarities, there is at least one important difference. An obviousness analysis requires that all of the elements present in a claim be considered, ²³ whereas, in the patent eligibility analysis set forth by the Supreme Court, contributions to nonobviousness stemming from the allegedly patent-ineligible subject matter are excluded before the remaining claim elements are examined for inventiveness. ²⁴ Thus, to be patent eligible, the combination of elements in a claim must not only be directed to an application of a law of nature and not to the law itself, it must also be “inventive” and the purported law of nature cannot contribute to inventiveness.

The effect of these requirements on the patentability of gene-based assays is devastating. For the great majority of claims to these types of assays, inventiveness depends on a relationship between gene expression or gene mutation and disease, a relationship that courts consider to be a patent-ineligible law of nature. The assay itself, when considered apart from the relevant genes, is usually a standard platform that is used repeatedly in analyses. As a result, claims are found to be patent ineligible because they lack inventiveness, and they lack inventiveness because the one element that would typically make them inventive has been excluded from consideration.

This is certainly true of the GTG claim considered by the Federal Circuit. Apart from the relationship between gene sequences and disease, the only other elements in the claim are a step in which DNA is amplified and a step in which the amplified DNA is analyzed. ²⁵ Predictably, the Federal Circuit concludes:

The first claimed step of “amplifying” genomic DNA with a primer pair was indisputably well known, routine, and conventional in the field of molecular biology as of 1989, when the first precursor application to the '179 patent was filed. . … 

. … The second physical implementation step, “analyzing” amplified DNA to provide a user with information about the amplified DNA, including its sequence, was also clearly well known, routine, and conventional at the time the '179 patent was filed. … “Applicant has not invented a new way to analyze genetic loci. Rather Applicant has found that when prior art techniques are applied to the non-coding sequences, the result can be more informative than analysis of the coding regions.” ²⁶

III. Conclusion

The GTG decision represents the fourth by the Federal Circuit concerning the patent eligibility of recombinant or gene-based technology since the Supreme Court decisions in Mayo and Myriad. The other three cases were: In re Roslin Inst. (Edinburgh) (concerning claims to cloned animals); ²⁷ University of Utah Research Foundation v. Ambry Genetics Corp. (concerning composition and method claims from the Supreme Court Myriad case which had not been under consideration); ²⁸ and Ariosa v. Sequenom (concerning diagnostic tests for paternally derived cell-free fetal DNA). ²⁹ Thus far, not a single claim in any of these cases has been found to be patent eligible and it is not presently clear what, if anything, the Federal Circuit and Supreme Court consider to be acceptable in this area of technology.

At one point in the GTG decision, the Federal Circuit states: “The similarity of claim 1 [in the GTG patent] to the claims evaluated in Mayo and Ariosa requires the conclusion that claim 1 is directed to a law of nature.” ³⁰ At first glance, it seems remarkable for the court to regard these three cases as having claims that are similar. Mayo had claims to a clinical method for adjusting the dosage of a drug being administered to a patient; Ariosa concerned claims to the detection of paternal DNA in maternal blood; and the current case is concerned with a method for characterizing the alleles present in an individual. These technologies are really quite different from one another. However, they are similar in the sense that in each instance, it is the allegedly patent-ineligible subject matter that contributes most to the novelty and nonobviousness of claims and, in every case, once this subject matter is removed from consideration, the remaining claim elements fail to meet the requirement of being “inventive.”

It is possible that, at the time of the Mayo, Myriad, and Alice decisions, the Supreme Court did not realize the far-reaching consequences of its decisions. If that is the case, those consequences should certainly be clear by now, and the Supreme Court has an opportunity to clarify matters by granting a petition for a writ of certiorari that was recently filed in the Ariosa case. ³¹ Of course, it is also possible that the Court was aware of the likely consequences of the decisions but concluded that they were still warranted. If this is the case, then biotechnology companies will need to learn to operate in an environment where patents to gene-based inventions are, for the most part, no longer obtainable.

Addendum

On June 27, 2016, the US Supreme Court denied certiorari in Sequenom v. Ariosa.