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SACGHS Final Report on Gene Patents - Taking a Machete to the IP Thicket

On September 17, 2009, the Secretary of HHS’s Advisory Committee on Genetics, Health and Society (SACGHS) issued a Final Draft Report on Gene Patents and Licensing Practices and Their Impact on Patient Access to Genetic Tests. The 66 page report amounts to a wide-ranging attack on biotechnology patenting and licensing, even as it proclaims that it does not opine on “protein-based genetic tests or patent claims on isolated proteins.” The report also tries to draw a line between its disapproval of patents on isolated genes or on simple tests based on gene-disease associations (read Myriad), and the development of test kits and multiplex tests, which it concedes may require patent protection for commercial development.

While beginning with the self-evident conclusions that professors like to conduct cutting edge research and publish the results (e.g., of gene-disease associations), the Committee goes on to conclude that clinical testing services rapidly arise, if there is physician interest (e.g., if someone will reimburse): “The case studies [of gene-disease associated testing] show that those researchers who did not pursue patenting were willing and able to invest in developing genetic tests soon after their discovery, despite the threat that ‘free riders’ could then offer competing test services.” I bet they are, but they are not offering the test for free – they are charging for it, and trying to use their brand names to gather market share. The Committee found that cost and regulatory hurdles were much higher for companies attempting to develop test kits “than for testing services” and that patent protection “may be needed for companies to be willing to risk resources in satisfying the regulatory requirement.” The Committee also only found that exclusive providers did not price-gouge, provide poor quality control, or otherwise limit patient access (but they might). However, this barely slowed the momentum of the report toward pushing gene and “simple association” patents off a legal cliff.

The next section is an investigation of how gene patents might inhibit “multiplex tests” (e.g., lymphoma-on-a-chip) or whole genome sequencing that could have been written by Affymetrix (a company who is specifically mentioned at least twice). It is beyond the scope of this post to begin to point out the legal errors or omissions in this section which focuses on how allegations of infringement of patents on single genes might block development in this area (something that does not appear to have occurred – I just read a paper on characterizing the genetic basis of malignant breast cancer that used a commercial chip that included over 50,000 gene probes).

Nonetheless, one of the Report’s conclusions is that “claims upon the act of simply associating a genotype with a phenotype should not be patentable because they are claiming laws of nature that cannot be invented around.” The Commission concedes that “[i]t would be up to the courts [to] decide what ‘simply’ means.” That is, enough complexity in a test might render it patentable.

The Report then has a long section on the case law and PTO policy that has ended up with the PTO granting patents on purified and isolated naturally-occurring materials, particularly genes. The Report glosses over the value that patents have provided to society in making hard-to-obtain vitamins and hormones available to patients. The Report goes on to recognize (and approve) that In re Kubin has made it more difficult to patent genes (but manages to skip how In re Fisher effectively delivered millions of pages of Seq IDs and claims to ESTs and SNPs to the recycling bin). The Report ends with the hope that KSR and Kubin revived the “obvious to try” (to clone) standard so that existing patents on genes will be challenged.

While I was sure that the Commission was headed toward a recommendation that patents on isolated genes should be outlawed, after noting that such claims are allowable in one form or another worldwide, the Commission recommended enactment of statutory exemptions from liability for those infringing gene claims by developing and selling tests developed for patient care purposes (but wait, earlier the Commission recommended barring patenting such tests altogether), and enacting an exemption for liability for those using patented genes ‘in the pursuit of research” (I thought we already had this exemption under common law – the Commission also misses the legal point that a patented test can be evaluated to see if it works without infringement). The Report closes with a bit of a whimper, by re-endorsing the NIH Best Practices for the Licensing of Genomic Inventions and the “Nine Points to Consider in Licensing University Technology” endorsed by AUTM. Finally, the Report recommends that the PTO establish a scientific advisory committee on genetic testing. “The Committee believes experts in the field could help USPTO in its development of guidelines on determinations of nonobviousness and subject matter eligibility in this field once pending court decisions such a Bilski v. Kappos are decided.”

Oddly, my phone remains silent.

Hearings On SACGHS Report


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