This is a guest post from Paul Cole.
An opinion was handed down earlier today by the Federal Court of Australia – Full Court (Allsop C.J., Downsett, Kenny, Bennett and Middleton J.J., D’Arcy v Myriad Genetics Inc  FCAFC 115 (5 September 2014))(1). In an outcome strikingly at variance with that before the US Supreme Court, it affirmed the opinion of Nicholas J. that claims for isolated nucleic acids are for a manner of manufacture for purposes of s.18(1)(a) of `Australian Patents Act 1990 and s.6 of the Statute of Monopolies (Cancer Voices Australia v Myriad Genetics Inc  FCA 65 (15 February 2013)(2) [The links for footnoted items can be found at the end of the post.]
In its opening remarks, the Full Court held that expressions such as “the work of nature” or “the laws of nature” are not found in the statute, nor are they useful tools of analysis. Adopting the reasoning of Frankfurter J. in Funk Brothers Seed Company v Kalo Inoculant Company,  USSC 22; 333 US 127 (1948), it confuses the issue to use such terms. They could fairly be employed to challenge almost any patent.
In a criticism of the double ingenuity requirement arguably derived from Mayo and CLS v Alice it observed that
“One can distinguish between discovery of a piece of abstract information without suggestion of a practical application to a useful end, and a useful result produced by doing something which has not been done by that procedure before. It is no answer to ingenuity in the discovery that the materials would produce a useful result to say that there was no ingenuity in showing how the discovery, once made, might be applied. It is only necessary to show one inventive step in the advance made beyond the prior limits of the relevant art.” (emphasis added)
The appeal centred on claim 1 of the Australian patent which differed from that before the US Supreme Court and was to;
‘An isolated nucleic acid coding for a mutant or polymorphic BRCA1 polypeptide, said nucleic acid containing in comparison to the BRCA1 polypeptide encoding sequence set forth in SEQ.ID No:1 one or more mutations or polymorphisms selected from the mutations set forth in Tables 12, 12A and 14 and the polymorphisms set forth in Tables 18 and 19’.
There were a number of significant features of the subject matter claimed. It was to a compound; a nucleic acid and not a claim to information. It was to the isolated nucleic acid; i.e. a nucleic acid taken out of the genome and removed from the cell. Isolated nucleic acid could not be the subject of cellular processes like transcription and translation as could its naturally occurring counterpart. It contained the code for a particular polypeptide; a mutant or polymorphic protein identified by comparison with tables created following extensive epidemiological research which described the location of the mutations or polymorphisms as they existed in DNA. The DNA had been constructed and these locations identified by the work of the inventors. The nucleic acids had admitted valuable economic use.
In the parallel CAFC case in the US, Bryson J. (dissenting) drew on a metaphor, likening an isolated nucleic acid and a branch being snapped off a tree. The Full Court held that the metaphor was inappropriate: the branch has not changed – it was simply divorced from the tree, whereas the chemical and physical makeup of the isolated nucleic acid rendered it not only artificial but also different from its natural counterpart. The claim was wider than for a “mere discovery”. The “magic microscope” theory relied upon in the Federal Circuit was that if an imaginary microscope could focus in on the claimed nucleic acid as it existed in the human body then the claim covered ineligible subject matter. This metaphor was unhelpful because what was being claimed was not the nucleic acid as it existed in the human body, but the nucleic acid as isolated from the cell. The claimed product differed from the naturally occurring product both structurally and functionally as a result of isolation.
Isolation also led to an economically useful result – in this case, the treatment of breast and ovarian cancers. This is surely what was contemplated by a manner of new manufacture in the Statute of Monopolies. As Moore J explained in the Federal Circuit:
‘it is not the chemical change alone, but that change combined with the different and beneficial utility which leads me to conclude that small isolated DNA fragments are patentable subject matter’.
Furthermore, it was difficult to reconcile the reasoning of the US Supreme Court in Myriad with its earlier reasoning in Chakrabarty:
“With respect, the Supreme Court’s emphasis on the similarity of ‘the location and order of the nucleotides’ existing within the nucleic acid in nature before Myriad found them is misplaced. It is the chemical changes in the isolated nucleic acid which are of critical importance, as this is what distinguishes the product as artificial and economically useful.
The fact that, hypothetically, if the isolated DNA sequence were replaced into the cell it would express the same proteins is irrelevant. Following Chakrabarty and NRDC, the isolated nucleic acid has ‘markedly different characteristics from any found in nature’; Myriad did not merely ‘separate that gene from its surrounding genetic material’. It should make no difference that in Chakrabarty there was an “addition” (of the plasmids) to the natural product (the bacterium); this is not the appropriate test. Myriad’s claim, properly considered is not, as the US Supreme Court considered, concerned ‘primarily with the information contained in the genetic sequence [rather than] with the specific chemical composition of a particular molecule’.
The reasoning of Lourie and Moore JJ of the Federal Circuit is persuasive. It accords with the High Court’s reasoning in NRDC and Microcell. The US Supreme Court accepted that cDNA is patentable. It rejected the isolated nucleic acid of claim 1 because it accepted wrongly, with respect, that the isolated nucleic acid is a “product of nature”. In any event, that exclusion is not in accordance with the principles of patent law in Australia and has been specifically rejected as a reason for exclusion in NRDC.
The isolated nucleic acid, including cDNA, has resulted in an artificially created state of affairs for economic benefit. The claimed product is properly the subject of letters patent. The claim is to an invention within the meaning of s 18(1) of the Act.”
Should this opinion be influential in the current US debate about eligibility? There is force in the argument that all eligible inventions should be subject only to a single requirement for an act of ingenuity and that a requirement for double ingenuity for natural product inventions imposes an unfair burden. That proposition is supported by Professor Jeffrey A. Lefstin, (University of California), Inventive Application: A History(3). Comparison of the US Supreme Court and Australian Full Court decisions shows how fact-sensitive the outcome may be. The Australian court was willing to take the claim language at face value and treat it as a claim to a polymeric species having real existence, whereas the US Supreme Court was not. One underlying reason may have been an appreciation by Justice Thomas that the BRCA1 patent did not disclose the full-length BRCA1 sequence, only some 27,000 of the 81,000 nucleotides of the full length gene having been identified, as pointed out in the dissent of Bryson J. But in any event, the Australian decision merits careful consideration in the US and may influence the discussions taking place in the USPTO about the Myriad-Mayo Guidance.