United States: Guidance On Patent Subject Matter Eligibility For Natural Phenomena And/Or Natural Products In The US: A Move In The Right Direction?

In decisions starting with Bilski (Bilski v. Kappos, 561 U.S. 593 (2010)), followed by Myriad (Association for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107 (2013)) and Mayo (Mayo v. Prometheus, 132 S. Ct. 1289 (2012)), and finally by Alice (Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347 (2014)), the U.S. Supreme Court transformed the issue of patent eligibility, with far-reaching implications for the pharmaceutical and biotech industries and their ability to obtain fair protection for the fruits of their research. Here, we consider the developments of the eligibility guidelines, how they are applied (including a number of illustrative examples) and practical implications for the pharmaceutical and biotechnology industries, including potential approaches to patent claim drafting.

Initially, in response to Myriad and Mayo, the US Patent and Trademark Office (USPTO) released a memorandum entitled "Procedure For Subject Matter Eligibility Analysis Of Claims Reciting Or Involving Laws Of Nature/Natural Principles, Natural Phenomena, And/Or Natural Products". This March 2014 Guidance applied to "claims (i.e., machine, composition, manufacture and process claims) reciting or involving laws of nature/natural principles, natural phenomena, and/or natural products".

The issuance of the March 2014 Guidance caused considerable and understandable concern in the biotechnology and pharmaceutical industries over exactly what might now be patent eligible. Few had imagined after the Myriad and Mayo decisions issued that the USPTO would seek to take the reasoning of those decisions (which, it had appeared, set a narrow exclusion to patentability to naturally occurring gene sequences) and extrapolate it to an extreme that most observers believe was never intended by the Courts. Section 101 eligibility in the US was always intended to be a coarse sieve, not a fine filter. The first months immediately after the issuance of the March 2014 Guidance saw a sharp rise in eligibility objections.

The USPTO embarked on an exercise in which it held meets with interested stakeholders, including representatives from the pharmaceutical and biotechnology industries. In the light of the feedback that it received, on 16 December 2014 the USPTO published its 2014 Interim Guidance on Patent Subject Matter Eligibility. This came into force with immediate effect and replaced the highly controversial earlier Guidance. It also supplemented the Guidance issued following the Alice Corp decision concerning abstract ideas issued earlier in 2014. The new Guidance requires the examiner to evaluate the claim as a whole. Examples are given of how the new approach should be applied, using the facts from previously decided cases including Myriad, Mayo and Alice. In the following, we discuss this new guidance and consider the practical implications for the pharmaceutical and biotechnology industries for the drafting, filing and prosecution of patent applications in the US directed to natural products.

It is firstly important to understand is that the December 2014 Guidance is for USPTO examiners to enable them to interpret the key Myriad, Mayo and Alice decisions. It is not binding on the US courts. This Guidance sets out a two-part test, with the second part itself divided into two steps. In step 1, the examiner must first decide if the claim is related broadly to patentable subject matter: is the claimed invention a process, machine or a composition of matter? If not, then the claim is not eligible subject matter. If it is, then the claim is analysed to determine if it relates in whole or in part to a judicial exception to patent-eligibility (step 2A). If not, then the claim satisfies the requirements of patent eligibility under Section 101. If the claim is determined to relate in part to a judicial exception, then the claim is analysed to determine if it recites additional elements that amount to significantly more than the judicial exception (step 2B). The analysis will only proceed to step 2B when the claim is directed to an exception, i.e. when no markedly different characteristics are shown.

We now consider how these steps are applied by the examiners through the use of illustrative examples that the USPTO has provided to its own examiners to assist them in guiding how they interpret the Interim Guidance of December 2014. We will then consider the practical implications for users of the patent system in the US seeking to obtain protections in the pharmaceutical and biotech fields.

Step 2A appears to be an important improvement for pharmaceutical and biotechnology companies in the approach to be adopted by examiners when considering eligibility of natural products when compared to the March 2014 Guidance. Thus, for example, under the December 2014 Guidance a combination product as a whole must be assessed to determine if it is markedly different from a product of nature. Under the March 2014 Guidance, evaluation of a combination of natural products was performed by individually comparing each component part to its naturally occurring form, and the effect of the combination of the products on, for example, the whole was not given.

As an example, under the March 2014 Guidance gunpowder was considered to be a combination of three naturally occurring products (potassium nitrate, charcoal and sulfur). Each was considered to be in its 'naturally occurring, unchanged state' in the mixture and it was not considered to display any of the exceptions set out in the final step of the March 2014 Guidance (equivalent to step 2B of the December 2014 Guidance). In the example published with the December 2014 Guidance, the analysis of gunpowder as a combination holds it to be markedly different from its naturally-occurring components because gunpowder is explosive, while the naturally-occurring substances on their own are not. This functional difference in the combination compared to the activities of the individual components enables subject matter eligibility to be acknowledged.

Another example where there has been a change in approach to combinations is seen in the example of a claim to a "beverage composition comprising pomelo juice and an effective amount of an added preservative". There is no naturally occurring counterpart to the claimed combination, so the combination is compared to the individual components as they occur in nature (Step 1: YES). Because of its "slower spoiling," the properties of the claimed combination are considered markedly different from the properties of the juice by itself in nature. (Step 2: NO). This is true regardless of whether the preservative is a natural product or a non-natural product. In the examples under the March 2014 Guidance, the composition comprising pomelo juice and another natural product (vitamin E) was considered patent ineligible as both were considered to be naturally occurring products which were unchanged in the combination, emphasising the importance of this change in approach resulting from considering the claim as a whole to determine if it is markedly different from a product of nature.

Another improvement in Step 2A is how Examiners should approach claims directed to or comprising isolated or purified natural products. Under the new Interim Guidance, such a product may be eligible if there is a resultant change in characteristics sufficient to show a marked difference from the natural counterpart. Differences that are exemplified include a change in the biological or pharmacological functions or activities, chemical or physical properties, changes in phenotype, or changes in structure and form, whether chemical, genetic or physical. Purified products were considered ineligible under the March 2014 Guidelines.

One example given together with the December 2015 Guidance is directed to a method claim reciting "a method of treating breast or colon cancer, comprising administering an effective amount of purified amazonic acid to a patient suffering from breast or colon cancer" is patent eligible under the new guidelines. The claim does not even require an analysis of "markedly different" because the claim is focused on a process of practically applying the product to treat a particular disease. Under the previous guidelines, such a claim was typically rejected as patent ineligible unless it also recited a dosage and/or a time period of administration. However it is to be noted that the analysis still considers that isolated purified amazonic acid is not patent eligible, despite the fact that the details of the example state that micrograms of the isolated compound are effective whereas a patient would have to ingest several tonnes of leaves to achieve the same effect, this is still considered to lack subject matter eligibility as the analysis argues that it is not 'markedly different' from the 'naturally occurring product in its natural state'.

For a claim that does not recite something "markedly different" from the natural counterpart (Step 2B), the Interim Guidance does not depart significantly from the March 2014 Guidance. The claim must be analysed to determine if elements other than those related to a judicial exception amount to something significantly more than the exception itself. The Interim Guidance provides examples of what is and is not considered "significantly more".

This is further emphasised by the example of 'purified Antibiotic L'. Under the Interim Guidance, a claim to this is deemed patent eligible. The different result is rationalised on the grounds that in the specification's definition of purified Antibiotic L, the claim is limited to Antibiotic L in the form of tetrahedral crystals or having a high-mannose N-glycan on residue 49. Thus, the claim does not encompass naturally occurring Antibiotic L (which forms hexagonal-pyramidal crystals, and has a bacillosamine N-glycan on residue 49).

An example of genetically modified bacterium illustrates that a naturally occurring product that is unchanged from its natural state ('A stable energy-generating plasmid, which provides a hydrocarbon degradative pathway) does not have markedly different characteristics and hence is not patent eligible: there is no information to suggest that they are markedly different from naturally-occurring energy-generating plasmids. However, a claim that incorporates changes in biological function between the claimed product and its natural counterpart ('A bacterium from the genus Pseudomonas containing therein at least two stable energy-generating plasmids, each of said plasmids providing a separate hydrocarbon degradative pathway') can demonstrate markedly different characteristics and hence be patent eligible: the bacterium comprising at least two plasmids is able to provide at least two hydrocarbon degradative pathways, compared to the naturally occurring counterpart that only has one, and hence is markedly different.

The public was invited by the USPTO to submit written comments up to 90 days from publication of the Interim Guidance in the Federal Register (a deadline of around 16 March 2015). This resulted in the issuance of further Guidance in July 2015. However, this did not address any issues relating to natural phenomena at all and was restricted to clarification of the guidance for abstract ideas.

The first months immediately after the issuance of the March 2014 Guidance saw a sharp rise in eligibility objections. Since the issuance of the December 2014 Guidelines, while the number of eligibility objections is still considerably higher than it was prior to the introduction of either sets of guidelines following Myriad and Mayo the impression of practitioners is that the number of eligibility objections has fallen. After all the clamour and the resultant partial retreat by the USPTO in the revised Interim Guidance, it is to be hoped that the promised 'balanced' approach is indeed starting to be seen in practice.

Time, of course, will tell and in the meantime we will be watching closely to determine how things develop and then devising the best strategies to adopt in this fast changing environment. However, we certainly advise at this stage that new applications in the US should include broader claims than might have been feared were allowable only a few months ago. It will be important, nevertheless, to ensure that fallback positions are included with specific limitations that may assist in overcoming any objections of lack of eligibility, e.g. specific crystal structures that are not found in nature, methods of treatment comprising specific dosage regimes, humanized antibodies and non-naturally occurring DNA sequences.

This article was originally published in MedNous.

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