Last week, Shelston IP reported that the Australian High Court (the Australian equivalent to the US Supreme Court) unanimously ruled that isolated naturally-occurring nucleic acids were not patentable subject matter in Australia. The decision itself has been widely reported. There has, however, been little or no commentary regarding the ramifications of the decision and, in particular, whether it will impact the patentability of isolated biological material other than naturally-occurring genes.
In the corresponding US Supreme Court Myriad case, a finding that isolated naturally-occurring genes were not patentable was interpreted by the United States Patent and Trademark Office as extending to all isolated biological material and preliminary reports by some Australian commentators suggest that there is no reason why Australian law will not follow suit and exclude all isolated naturally occurring material from patentability. It has also been reported that the High Court decision goes further than the US Myriad decision because artificially synthesised nucleic acids, such as cDNA, may also be excluded from patentability.
The Myriad ruling consists of three separate decisions: the majority decision by French CJ, Kiefel, Bell and Keane JJ; and two minority decisions, one by Gageler and Nettle JJ and another by Gordon J. Generally speaking the reasoning of a minority judgement insofar as it differs from the majority judgement would not be relied on for setting precedent law because one assumes that the majority did not agree with the minority reasoning. As such, the discussion below predominantly considers the majority decision.
The intent of the Myriad action
In reaching an understanding of how the Myriad decision should be interpreted, it may be useful to initially consider the intent of the High Court Appeal.
In her special leave submission to the High Court, D'Arcy states "the applicants intended this to be a test case on the patentability of human genes". This is reaffirmed in D'Arcy's written submission to the High Court, which states, "[t]his appeal presents the question whether an isolated human gene is a patentable invention, being a manner of manufacture within the meaning of s18(1)(a) of the Patents Act 1990 (the Act)". Nothing in D'Arcy's submissions relate to the patentability of isolated biological material other than human genes.
Given that all isolated naturally-occurring material became patent ineligible after the US Supreme Court Myriad ruling, the Institute of Patent and Trademark Attorneys Australia (IPTA) made a submission to intervene in this case and submitted affidavits from senior patent attorneys (including the author of this article) and scientists indicating that excluding isolated naturally-occurring biological material generally from patentability would adversely impact the Australian biotechnology industry.
In her reply to IPTA's intervention application, D'Arcy stated at paragraph 21 that "no question concerning the patentability of 'other material isolated from nature' arises on the facts of the present case". Accordingly, D'Arcy's appeal had no intention of challenging the patentability of anything other than isolated human genes.
The intervention application by IPTA was ultimately rejected by the High Court, and thus it is reasonable to assume that D'Arcy's position, namely that the case only relates to the patentability of human genes, was accepted by the High Court. Support for this view is provided at paragraph 37 of the majority decision, which states that "this Court is not concerned in this appeal with 'gene patenting' generally but whether the invention as claimed in claims 1 to 3 fall within the established concept of manner of manufacture".
Isolated biological material other than nucleic acids
In coming to its decision the Court followed the principles of the High Court's decision in National Research Development Corporation v Commissioner of Patents ('NRDC')  HCA 67 and thus considered the "artificialness" and "economic significance" of the defined nucleic acid sequences. In this regard, the majority decision identified that the essential integer of the claimed invention is "information" rather than an isolated chemical product since the nucleic acid sequence is used in a genetic diagnostic screening test. The majority decision also states (in relevant part) that the specified mutations or polymorphisms, i.e. the "information", "... has nothing to do with the person who isolates the nucleic acid bearing the mutant sequence".
Thus, it was found that the "information" defined by the disputed claims was identical whether isolated or not and further that the information had not been made by Myriad. On that basis the High Court found that the isolated sequences did not satisfy the artificialness requirement.
Regarding the second requirement for determining patentable subject matter, namely economic significance, the majority decision states:
This statement is critical in understanding the position of the majority decision because it forms a nexus between the "artificialness" required for patentable subject matter and the "economic significance" of an invention. As the economic significance of the Myriad patent resides in conducting a genetic screening test (a process), the "step along the way to a process", namely the isolation of the nucleic acid sequence was found to be insufficient to make the isolated sequence itself (which is not sold and therefore does not have a direct economic benefit) patentable subject matter.
The above analysis has important implications in determining the scope of the High Court's ruling. Firstly, it is reasonable to interpret the majority decision insofar as it relates to the requirement for "artificialness" as being limited to isolated biological matter where the essential integer of the claimed invention relates to sequence information and, in particular, nucleic acid sequences that are used in genetic screening tests and other applications that rely on a review of the relevant sequence information. This would not be the case for an isolated naturally-occurring protein, or an isolated naturally-occurring nucleic acid sequence capable of use as a medicament or even an isolated micro-organism because such isolated materials do not relate to "information" in the sense described by the High Court. Moreover, these types of isolated biological materials can be sold. In other words, their state of being isolated provides a direct economic significance rather than a "step along the way" to economic significance. And finally, the state of being isolated is linked to their utility. Accordingly rather than information, an isolated naturally occurring medicament is a product that has been made by human activity and therefore should satisfy the requirement of patentability in view of the Myriad decision.
Finally, if the High Court had intended that its decision be interpreted to include biological material other than isolated naturally-occurring genes, it is logical that it would have mentioned such material in their ruling. Consistent with this view, is the statement made in relation to cDNA in paragraph 89. However, no mention of biological material other than nucleic acid sequences is made in any of the rulings. Thus, for all of the reasons provided above, it seems clear that the Myriad decision cannot be determinative in relation to excluding from patentability isolated biological material other than isolated naturally-occurring nucleic acid sequences where the sequence information is considered to be an essential part of the claimed invention, such as inventions directed to genetic diagnostic testing.
The patentability of cDNA
There have been a number of reports that the majority decision to exclude isolated naturally-occurring gene sequences extends to cDNA. This is based on paragraph 89 of the decision, which states in relevant part that "[t]hat characteristic (i.e. the information which is an essential element of the invention claimed) also attaches to cDNA, covered by the claims, which is synthesised but replicates a naturally occurring sequence of exons".
In my view, this paragraph only extends to certain cDNA that is used for genetic diagnostic testing and similar applications that rely on a review of the relevant nucleic acid sequence information. This is clear because paragraph 89 makes mention of cDNA with specific reference to the invention of the patent-in-suit. In particular, paragraph 89 states "the existence of that information which is an essential element of the invention as claimed", where the term "that information" relates to "the information stored in the nucleotides coding for the mutated or polymorphic BRCA1 polypeptide". The "coding for" language simply means that the mutations and/or polymorphisms reside in the exons of the BRCA gene. Thus, the cDNA derived from the genomic BRCA gene will also include the mutations and polymorphisms associated with a predisposition for cancer. However, that will not always be the case. As indicated at paragraph 108, mutations and polymorphisms can also occur in introns. A cDNA derived from such a gene could not be used in a genetic diagnostic assay and, as such, would not have the same information as the naturally-occurring genomic DNA from which it is derived and therefore be patent eligible.
It is also correctly stated at paragraph 102 that "although the introns do not encode a polypeptide or protein, they contain information which helps regulate and execute the cell's response to the information encoded in the exon. Thus, an isolated cDNA that is used to express a protein or peptide contains different information to that which is contained within a cell because the introns, and the information they contain, have been removed. As cDNA lacks the intron information, it logically represents information that has been made as a result of a human action. Moreover, the removal of introns has advantages that permit more efficient expression of proteins. Accordingly, in cases where genomic DNA and cDNA ultimately code for the same protein, the information contained in these different nucleic acid molecules is nonetheless distinct.
There are also instances where differential splicing of exons in genomic DNA is required for protein expression, for example the generation of antibodies. Production of antibodies is further complicated by the process of somatic hypermutation (ie random mutations introduced in the DNA to increase antibody affinity), which occurs after the rearrangement of various antibody genes. Exon rearrangement and somatic hypermutation that occurs for a particular antibody cannot be predicted.
Given the diversity of information that exists between naturally-occurring genomic DNA and artificially-created cDNA it would be illogical for this decision to be interpreted broadly as excluding all cDNA from patentability.
The Australian High Court Myriad decision has resulted in some observers "hitting the panic button" and demanding immediate legislative change. However, a reasoned review of the decision suggests that it should be applied very narrowly and if that occurs its impact on the Australian biotechnology industry will be limited. At this stage, IP Australia is considering the decision with a view to revising their examination guidelines. Once the revised guidelines are made available, Shelston IP will be well placed to provide advice in relation to how the decision will ultimately impact the patentability of biological inventions in Australia.
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