Australasian Science: Australia's authority on science since 1938

The Changing Role of IP in Genomics

Credit: Sergey Nivens/adobe

Credit: Sergey Nivens/adobe

By Dianne Nicol

Recent court decisions have overturned previous rulings about genetic patents, but other intellectual property regimes are already taking their place.

Patents that claim exclusive rights over DNA sequences, proteins, stem cells and other research materials and methods of their use continue to occupy the genomic technology landscape. On the one hand, patents of this nature could facilitate the development of novel therapies and treatments by encouraging investment in further innovation and product development. Alternatively, they could have a stifling effect if they close off new areas of research and technological innovation. This stifling effect is referred to in this article as the “gene patent” problem, recognising that the problem extends beyond simple patent claims to DNA sequences.

Australia, like many other countries, has wrestled with the question of whether this gene patent problem exists in practice and, if it does, how it should be resolved. Law reform agencies have been cautious, recommending nuanced responses. This reflects the delicate balance that intellectual property laws must maintain in protecting the interests of technology leaders, follow-on innovators and society more broadly.

There has been speculation about the gene patent problem since the start of the genomics revolution. In the early 1990s, when the Human Genome Project was in its heyday, the National Institutes of Health caused consternation in the research community when it filed applications for a multitude of patents that claimed rights to small fragments of DNA. The primary utility of these short DNA strands was as research tools. Although the applications were subsequently withdrawn, these events triggered increased scrutiny of the role of patents in genomic research and innovation.

The primary concern was that whole areas of research and development could be blocked off by the zones of exclusivity created by broad gene patent claims. At the very least, researchers and technology developers would be required to negotiate permission to operate within these zones, which could be refused. In 1998 Michael Heller and Rebecca Eisenberg wrote that an even more serious problem could arise if there were multiple overlapping zones of exclusivity, creating a series of “tollbooths on the road to product development”. They called this the anticommons tragedy.

Clear evidence of widespread blocking and anticommons effects has yet to emerge. Indeed, in Australia and elsewhere it appears that where gene patents do exist, their owners have been largely indifferent about policing their exclusivity zones, even going so far as to abandon them entirely. Yet concerns have continued that the environment could be ripe for the emergence of strategic patent enforcement activities by the for-profit sector.

It has to be acknowledged that the development of new healthcare products is risky and expensive, and not normally the province of the non-profit research sector. Rather, healthcare technology development is handed to for-profit partners, who are better equipped to manage these issues. Their business models are generally built around using robust intellectual property rights to ensure a return on investment. Patents, in particular, provide them with exclusivity in the marketplace, albeit temporarily (usually for 20 years).

This seemingly makes good practical sense: patents provide an incentive to innovate, which is good for society. There is much that could be said about whether or not the current patent system achieves this purpose. There are recognised problems associated with patent overreach, particularly in the pharmaceutical sector, but that is not the province of this article. Rather, the issue under consideration here is that, for better or worse, these zones of patent exclusivity have been allowed to creep into the genomic research and technology space. We need to think about what might be the consequences if they are removed or reduced in scope.

We have a natural experiment here, because in the past couple of years the highest courts in the US and Australia have declared that isolated DNA sequences that are identical to their natural counterparts are not patentable subject matter. This is obvious for many molecular biologists – DNA sequences are repositories of information that remain unchanged in the transition from the cell to the laboratory. Alternatively, some biochemists argue that DNA is a chemical that undergoes fundamental change through the process of isolation.

For many years, patent offices were comfortable with the idea that chemical isolation creates subject matter that’s patentable, provided that some sort of useful function is identified. Likewise, methods using these isolated chemicals could also be the subject of valid patent claims. There are, of course, other requirements for patentability, including novelty, inventive step and full disclosure, which impose restrictions on the scope of the exclusivity zone that can be claimed.

The recent court decisions mentioned above turned the tables on earlier patent office interpretations. Admittedly, the specific DNA sequence patents that were under consideration by the courts included very broad claims that created a zone of exclusivity over all potential future uses of those sequences. They were particularly controversial because of the way that the patent owner, Myriad Genetics, chose to exercise exclusivity rights in the US, and the way that its exclusive licensee threatened to do so in Australia. Because the DNA sequences in issue were connected with increased propensity to develop breast cancer, there was a major public health issue at stake.

It may be that other courts will decide that other DNA sequence claims are valid, depending on the way they are drafted and the way their exclusivity zone is circumscribed. We don’t yet know how this will all play out.

The US Supreme Court has made further inroads into the gene patent problem, holding that patents claiming methods of using subject matter derived from the natural or abstract world will be invalid unless the methods themselves are truly innovative (the Australia High Court hasn’t yet had chance to deliberate on this question). The consequence is that parties claiming rights to technological innovations like Dolly the cloned sheep and non-invasive prenatal testing have failed to satisfy the lower US courts that these are patent-eligible. This is so even though the judges deciding these cases have expressed concern about the consequences of such decisions, going so far as to say that they may discourage the development and disclosure of new diagnostic and therapeutic methods.

Many commentators are more sanguine, arguing that the patents in issue were claiming far too expansive zones of exclusivity relative to the innovative concept they disclosed. Still, it is not at all clear that we now have the balance right: it could have shifted too far in favour of technology followers rather than leaders. Alternatively it may still be the case that clever patent attorneys working for technology leaders could find ways around the restrictions imposed by the courts.

In the diagnostic testing context, the indications seem good that blocking and anticommons concerns have largely dissipated. As noted in the 2015 Report on Confirmatory Genetic Diagnostic Test Activity by the US Patent and Trademarks Office, the US cases “dramatically affect the landscape of diagnostic testing”. Although the report focused specifically on confirmatory (or second opinion) tests, it concludes more broadly that this changing landscape will allow many smaller providers to enter the market. This will benefit consumers if it increases choice and decreases costs.

Despite the removal of some of the more excessive gene patent claims by the courts, other intellectual property regimes are already taking their place in restricting the entry of alternative providers into diagnostic testing. Companies that have been offering diagnostic tests exclusively for a number of years in reliance on their patent rights now have extensive databases of population-wide genetic data, which are used to compare genetic variations of otherwise unknown significance with particular disease manifestations. Trade secrecy laws allow them to keep their data confidential.

These datasets put their proprietors at a competitive advantage over other test providers. Circumventing this proprietary database dilemma will require the creation of equivalent public access datasets. Initiatives like the BRCA Challenge of the Global Alliance for Genomics and Health are already making inroads. The aim of this initiative is to bring together data on BRCA genetic variations from around the world and to make it openly available for research aimed at better understanding the genetic basis of this and other cancers. The long-term aim is to improve diagnosis and prevention. However, significant progress will take time.

In parallel, yet another gene patent battle is playing out in the US. This time the genetic technology in issue is CRISPR-Cas9, which facilitates much more accurate editing of the human genome than past techniques. Here the dispute is unusual because it is between two non-profit parties, the Broad Institute at Massachusetts Institute of Technology and the University of California, Berkeley. More often than not, these types of disputes are fought out between for-profit entities hoping to establish market exclusivity.

The question at issue in this matter is which of these research organisations has the right to claim exclusive use of the CRISPR-Cas9 technology. This technology has already been broadly adopted in the academic research community, and new for-profit entities are emerging. The consequences of this battle could be significant for both sectors. The fact that it is occurring at all shows that gene patents will continue to play a significant role in influencing the direction of and participants in genomic research and innovation, despite court decisions invalidating some of the more excessive gene patent claims.

This all indicates that we should not be too complacent that a couple of court decisions can fix all that is perceived to be wrong with gene patents.


Dianne Nicol is Director of the Centre for Law and Genetics at The University of Tasmania.