By Kevin E. Noonan --
Progress, and faith in progress to improve human lives, has been a cornerstone belief in American civilization (and, indeed, Western civilization generally, at least since St Augustine argued that Christ's death put an arrow on history). It was so important to the Founding Fathers that they enshrined promoting progress as one of the powers of Congress in the Patent Clause.
But there has always been a countervailing meme: that technological progress threatens our humanity and that we run the risk of having our humanity devalued by overreliance on technology. This idea has fueled countless science fiction plots, from Frankenstein to The Matrix. In many ways, the urge for "natural" products is a reflection of that idea, and while it provides a useful and (general) healthy counterpoint to overly processed foods, the philosophy has its limits. As Covert Bailey used to say, syphilis is natural.
And in the biotechnology era, that is the point: most of what biotechnology addresses involves the breakdown of the natural machine, at the cellular level. It has provided and continues to provide drugs that have addressed chronic disease and provided insights into the mechanisms for other diseases of ancient provenance. Most of the fears that have arisen regarding biotechnology -- Asilomar, test-tube-babies -- have not come to pass. And in their stead have been elucidation of the basis of diseases like muscular dystrophy and Huntington's chorea, as well as personalized medicine and treatments for cancer, AIDS, and Alzheimer's disease.
Indeed, the disruptions that technology can cause are social ones, and these need to be addressed. Apocryphally, medieval shoemakers threw sabots into prototype machines for mass production to disable them, and this sentiment persists today in resistance to technological change. What is needed is not resistance to technology but the political will to help workers adapt to such change, and these days political will is one thing most recognize is sorely lacking.
The National Geographic Channel is airing a new special "Breakthrough: More than Human," hosted by Paul Giamatti and premiering Sunday, November 8 at 9 p.m ET/8 p.m. CT, which addresses some of these questions. It is serious and informative, and is a welcome addition to the conversation we need to have about technological change.
But the truth is that the only thing to fear is fear of the new and unknown. And it would be a shame if collectively we are too afraid to take advantage of the ever-increasing pace of technological change, because we are too afraid of an unlikely dystopian future to accept the benefits we are more likely to get in return.
How to Manage Intellectual Property and Patent Law
By Ralf Boscheck* --
International intellectual property regulations are doing serious damage to the pharmaceutical industry and, by extension, to the health of people around the world. The core of the problem: growing global concern about how to ensure affordable access to medicine without damaging the initiatives that sustain pharmaceutical research. Attempts to address the issues have resulted in significant disagreement between developed and emerging economies about just how much protection should be available to companies that develop new drugs.
Members of the World Intellectual Property Organization, which celebrated its 40th anniversary this year, are trying to resolve their differences on how -- and even whether -- emerging market countries should move to a framework that offers greater IP protection, but the results to date are not promising. "Access to medicine" advocates propose measures based on national income levels; branded drug producers want a time-based transition schedule; others argue that patent protection should be linked with the UN's Human Development Index, which is a relative scale with frequently-changing outcomes and policy incomes.
The case for strong patent protection
Developed countries, particularly the United States, usually try to commit emerging economies to more stringent intellectual property right rules in exchange for bilateral concessions in other areas of trade. These arrangements typically involve an extension of patent terms and data exclusivity as well as limits to parallel trade and accelerated marketing approval for generic producers.
Strengthening intellectual property rights, they argue, incentivizes research on diseases that are specific to developing countries and promotes technology transfer through the localization of R&D and production investments. This then contributes to improving typically inadequate health service infrastructures.
The counterargument: cost and accessibility
For many observers in emerging economies, however, strict protections on IP translate into higher prices for life-saving drugs, delayed generic competition, and weakened local production. As a result, countries like India have taken the lead in employing patentability criteria that may set new standards for emerging and possibly emerging markets alike.
In 2005 India amended its patent law in line with the international agreement on trade-related aspects of intellectual property rights (TRIPS). However, it also inserted a provision preventing the patentability of substances including salts, esters, and metabolites, and other derivatives and combinations of previously known compound. It also banned the patenting of new uses of existing compounds.
This provision has since been used to deny drugs such as Sutent, Pegasys, Tarceva and Glivec the same patent protection available to them elsewhere.
Attempts to challenge the law as not being TRIPS-compliant failed, with India's supreme court ruling that the provision was, among other things, intended to ensure that the country's citizens had easy access to life-saving drugs and to prevent "evergreening" of patents.
However, research published last year casts doubt on just how effective this approach is, at least regarding the first part: a review of 184 drugs between 2000 and 2009 concluded that only 60 percent of the products in US markets were available to Indian patients by 2010. Half of the drugs had a launch lag of more than five years, while a quarter lagged by more than nine.
The "evergreening" debate
"Evergreening" is a series of techniques used by pharmaceutical firms to continue protecting their drugs after the initial patent expires in order to maximize their return on R&D investments. That is, they prevent or limit the manufacture of generic drugs for longer.
The specific approaches used are numerous, but include continued differentiation of branding, dosing, formulation or mode of action; patenting active compounds or co-specialized delivery systems; and seeking to expand a compound's market through approvals for new indications.
Critics of evergreening strategies argue that this means that patients miss out on the benefits of cheaper generic drugs. However, they also usually neglect the existence of regulatory and market responses that limit the risk of abusive patenting.
For instance, patentability typically requires an invention to be novel, non-obvious and useful in the sense of capable of industrial application. The coloring and scoring of a drug may appear on the surface to be purely aesthetic, but if it can be shown to improve patient compliance, and therefore efficacy, that is novel and not obvious, and must therefore be patentable. In short, properly designed and implemented patent systems already deal with some of the often claimed evergreening concerns.
Both the US and EU systems allow companies to legally challenge patents and potentially speed up generic substitution. In Europe, generic companies have nine months to revoke a patent through a process administered by the European Patent Office. In the US, the Hatch-Waxman Act offers producers of bioequivalent generics that certify not to be infringing any valid patent surrounding the original compound an abbreviated new drug application.
When this happens the patent holder has a choice: contest the application, with all the costs and uncertainty this involves; ignore it, and plan on losing up to 80 percent of its total sales within a year; or pay the generic manufacturer not to get involved for a defined period.
This last approach, known as a reverse payment or "pay for delay," can mean that a big pharmaceutical company that has already spent hundreds of millions of dollars developing a drugs can find itself paying out millions more to another company to hold on to its own IP in what could be characterised as a form commercial blackmail. Or, looked at the other way, big companies are using their financial heft to prevent competition that could lead to cheaper drugs for patients. However, if a settlement allows entry before any litigation would be terminated and patent expires -- whichever comes first -- the apparently anti-competitive agreement may actually improve consumer welfare.
For more than 15 years, pay-for-delay deals have extended the life of contested pharmaceutical patents, and given the indeterminate impact on consumer welfare, the U.S. Supreme Court has been unwilling to take a definitive position either way. Just as in other areas of dispute between intellectual property rights and antitrust law, settlement deals present a substantial conceptual challenge to be translated into efficient regulatory standards. Such difficulty, however, does not justify a call for additional actions against evergreening of pharma patents or the use of any regulatory short-cuts.
Escalating healthcare expenditures and the need to ensure access to affordable medicine in both emerging and emerged economies are fueling calls for containing evergreening practices around the world. But such practices are the necessary outcome of a system that responds to market incentives and is already sufficiently controlled by established patentability standards and policies to determine patent term extension. Even reverse payment arrangements may ultimately deliver consumer net benefits. They present a challenge for efficient rule writing and a reminder of the need for better and coordinated policy analysis.
* Ralf Boscheck is the Lundin Family Professor of Economics and Business Policy at IMD. He is program director of IMD's MBA program. With more than 20 years of teaching in a number of IMD's executive programs, Prof. Boscheck believes in using intensive and direct interaction to develop technical competencies, self-awareness and moral judgment.
For additional information regarding this topic, see Prof. Boscheck's paper "Intellectual Property Rights and the Ever-greening of Pharmaceuticals."
Julian Cockbain, a former partner at the UK patent firm Dehns, sent us the following request:
Could I ask a favour? That you ask on your blog that readers send me copies of papers or theses that they have written on the subject of patent-eligibility (what is the proper subject matter for patents rather than what is new, inventive, etc)? I've written a book on the subject in relation to European law with Sigrid Sterckx (CUP, 2012) and would like to spend the summer reading others' ideas [including yours].
(Professor Sterchx's publications can be found here).
Julian can be reached at firstname.lastname@example.org or Julian Cockbain, Hoogpoort 28A101, B-9000 Gent, Belgium. He also has suggested that his views may not be entirely consistent with those expressed on this blog, and accordingly this is an opportunity for our readers to enlighten him.
The ABA Journal has begun work on its 9th annual list of the 100 best legal blogs (or blawgs) and has announced that it is seeking the advice of its readers, via the ABAJournal.com website, on which blogs to include on this year's Blawg 100. For the past three years, Patent Docs has been honored to be included among the five blogs selected in the IP Law category of the Blawg 100 (see "ABA Journal Announces 2012 Blawg 100"; "ABA Journal Announces 2013 Blawg 100"; and "ABA Journal Announces 2014 Blawg 100").
Readers interested in nominating a particular blog for the 9th annual Blawg 100 should use the ABA Journal's blawg 100 amici form. Additional information about the Blawg 100 can also be found on the blawg 100 amici form. The form requires that anyone making a nomination provide a name, employer or law school, city, and e-mail address. The ABA Journal requires this information in order to discourage:
• Bloggers who nominate their own blogs or nominate blogs to which they have previously contributed posts.
• Employees of law firms who nominate blogs written by their co-workers.
• Public relations professionals in the employ of lawyers or law firms who nominate their clients' blogs.
• Pairs of bloggers who have clearly entered into a quid pro quo agreement to nominate each other.
The ABA Journal, however, welcomes comments (up to 500 words in length) from readers who do not fall into the above categories.
• The ABA Journal is primarily interested in blogs in which the author is recognizable as someone working in a legal field or studying law in the vast majority of his or her posts.
• The blog should be written with an audience of legal professionals or law students in mind.
• The majority of the blog's content should be unique to the blog and not cross-posted or cut and pasted from other publications.
• The ABA Journal is not interested in blogs that more or less exist to promote the author's products and services.
Nominations must be submitted no later than 11:59 pm (CT) on Sunday, August 16, 2014.
Will a rose by any other name . . .?
By Kevin E. Noonan --
As part of his remarks during the Keynote Luncheon earlier today at the Biotechnology Industry Organization (BIO) International Meeting, New BIO Chairman of the Board Ron Cohen announced that BIO will be changing its name to the Biotechnology Innovation Organization. The change "better expresses the essence of what our member companies represent," according to Mr. Cohen, who is also CEO of Acorda Therapeutics. Jim Greenwood, longtime BIO President and CEO, called it "a great move that will help clarify for policymakers and the public the heart of our industry -- scientific innovation that will help to heal, feed and fuel the world."
The change will be effective early in 2016. At least they won't have to change the monogrammed towels.
In 2009, the first edition of Dr. David Koepsell's book "Who Owns You: The Corporate Gold Rush to Patent Your Genes" was published. With the second edition of his text about to be published, Dr. Koepsell allowed Patent Docs to post the Preface for his book as well as the Foreword, which was authored by Dr. Kevin Noonan.
First, Dr. Noonan's Foreword:
David and I have had a friendly disagreement about the subject (and even the title) of this book ever since it was first published, and I am happy that he asked me to write this Foreword to the Second Edition. The issues David raises in the pages to follow continue to be relevant to a discussion of philosophy and patent law, with events that have occurred since the first edition justifying (indeed, demanding) this update.
Without getting into the deep waters of philosophy (David's métier, not mine), as we have discussed the issues in the book David contends that he takes a deontological approach and has characterized mine as a utilitarian one. Accepting that dichotomy I understand the difference to be that David is operating from "first principles" about the rules society should impose on human activity and specifically on what the law permits individuals to "own" with regard to genes and more broadly naturally occurring substances. I disagree with that approach on several levels, perhaps the most germane of which is that if we posit rules we need to impose a rule‐giver and the potential for improvident rules (if not outright abuse of the privilege) makes me wary; in some ways I subscribe to Lani Gruinier's suspicions about the effects of the "tyranny of the majority" in this regard.
Part of that tyranny is also the tyranny of unintended or intentional ignorance. The issue here—"gene" patenting—is one at the intersection of molecular biology and modern genetics, on the one hand, and patent law (an area notorious for its arcane minutiae). I used to joke with my colleagues about the effect of trying to explain my position to a lay audience of any type and how I distrusted those who advocated that all that was needed was to "educate" the public, the press, and policy makers. The problem for proponents of gene patenting has been that opponents have gotten the better part of the debate, not by making a reasoned philosophical argument such as the one you will find in these pages but instead by making an emotional plea to individuals afraid that corporate America was trying to "steal" their genes, which has proven very effective. This process began with an Op‐Ed piece in The New York Times by Michael Crichton, wherein he posited a scenario where a patent holder knocks on your door one day and demands payment for the use of "her" patented gene that resides in your liver. (Not coincidentally, Dr. Crichton had just published a novel on the perils of genetic engineering and corporate ownership of human genes, complete with an essay as an addendum containing his arguments against the practice. And it should be noted that a constant theme in his novels was a mistrust of technology and particularly the ability of humans to use it without dire consequences). Academics like my friend Lori Andrews at Illinois Institute of Technology (IIT)‐Kent School of Law joined in this theme, which was picked up eventually by most popular press outlets and became, regrettably, the canonical narrative on gene patenting, culminating in the American Civil Liberties Union's (ACLU's) "Keep Your Hands Off My Genes" slogan and logo. I hope that this essay provides some antidote to this argument, which is founded on the literal fear that someone can "own" you. (David assures me that his title is allegorical and that he acknowledges that in all countries that have banned slavery no one can "own" another human being or a part of them. See the 13th Amendment. I assure you that the ACLU has no such illusions about the intended consequences of their ownership rhetoric).
My philosophy is that the principle we should follow is the greatest good to the greatest number, while not infringing on individual rights without (at least) compensation. As regards patent law, this principle is translated into rules that foster the broadest disclosure of technology possible in return for exclusive patent rights and robust‐enough enforcement rights for patents that they provide sufficient certainty to promote investment so his technology is commercialized to benefit the greatest number. In my role as a biotechnology patent attorney, I have seen how risky investment in biotechnology can be (indeed, the evidence is overwhelming that for all its successes, biotech's history is littered with the remains of companies that have failed) and how important it is to have a sound patent system of predictable rights go support that investment.
The evidence in support of "gene patenting" and more broadly natural products patenting is strong: the biotechnology industry has promoted innovation in the form of new drugs and diagnostics assays for a generation. This may continue despite the recent restrictions on patent protection for genes and natural products (including patent‐restricting decisions in Mayo Collaborative Labs. v. Prometheus Labs and Assoc. of Molecular Pathologists v. Myriad Genetics and recently promulgated U.S. Patent and Trademark Office Guidances on Subject Matter Eligibility). In fact, these very restrictions suggest that we would benefit from an appreciation of the facts surrounding the past thirty years of gene patenting to understand why these restrictions are not only wrongheaded but dangerous for future innovation.
These include debunking several myths. First, the concern that patents on specific human genes in some way inhibit innovation in basic genetic research is entirely unfounded. One reason is that the genetic information itself is not patented; while isolated DNA is encompassed by gene patent claims and described in those claims by its sequence, the sequence itself is unpatented information that can be used freely for any purpose (e.g., interrogating genetic databases from other species or even human DNA, inter alia, to find related genes in those databases). Indeed, the innovative benefits to gene patenting are evident in at least two ways. First, scientific publication databases reveal that there have been more than 11 000 scientific papers published on the BRCA1 and BRCA2 genes since the patents claiming them were granted. This outcome refutes the prediction that gene patenting would create a "tragedy of the anticommons" where scientific research would be stifled by patenting (see, Heller & Eisenberg, 1998, "Can Patents Deter Innovation? The Anticommons in Biomedical Research," Science 280: 698–701)), a conclusion supported by the overwhelming majority of studies done on this subject (see, for example, Walsh et al. 2003, "Science and the Law: Working Through the Patent Problem," Science 299: 1020; Walsh et al. 2005, "Science and Law: View from the Bench: Patents and Material Transfers," Science 309: 2002–03).
In addition, policies that the U.S. Patent and Trademark Office adopted in 2001 required applicants to disclose a practical utility for the product of a gene claimed in a patent. These requirements were imposed at a time when the standards for scientific journal publication were much less stringent, so that identifying a gene by the extent of genetic similarity between the "new" gene and previously discovered genes was enough for publication. But it was not enough for a patent, which has been held to be "not a hunting license. It is not a reward for the search, but compensation for its successful conclusion." Thus, genes encoding proteins having no known use or biological activity cannot be patented, because to do so would allow the gene to be within the exclusive patent right undeservedly; the public would not have received its quid pro quo of a useful invention in return for patent exclusivity. All such genes not having patent protection are in the public domain (from which they cannot be retrieved for future patenting), and for humans these constitute the vast majority of genes identified, inter alia, by the Human Genome Project.
The role for patenting genes, and the related genetic diagnostic methods using this genetic information, in the successes of the biotechnology era are evident: The industry has produced hundreds of biologic drugs (at an ever-increasing rate) that have provided effective treatment for a variety of illnesses, and decoding the human genome has enabled researchers to identify genes, like the BRCA1 and BRCA2 genes, that can be used in predictive genetic diagnostic tests. Even the much‐maligned Myriad Genetics has played a positive role in the development and prevalence of genetic diagnostic testing. It must be remembered that in 1997 (when Myriad's BRCA gene patents were granted), genetic testing was in its infancy, and companies like Myriad were under the burden of convincing payers that the tests did the one thing that all insurers, public or private, require of such tests: save them money in the long run, by identifying patients with a high probability of becoming ill and costing the insurers much more for treatment than the costs of prophylaxis. Moreover, Myriad and like companies needed to convince doctors that the testing was worthwhile and to establish a network of genetic counselors who could explain to healthy women that they were at much greater risk of developing breast or ovarian cancer than normal, under circumstances that resulted in empowerment from the information and not abject fear. And in 1997, genetic sequencing technology was not as developed as it is now, and the mechanisms and techniques needed to minimize or eliminate the occurrence of false positives or negatives had not been conclusively established. All these burdens were ones borne by Myriad, and these activities produced the world we have today.
It is possible, as some have argued, that BRCA tests may have been developed independently by individual researchers in the absence of patent protection. However, it is almost certain that such researchers would have been located in medical centers in urban environments. Under these circumstances, women living in or near cities such as New York, Boston, Philadelphia, Cleveland, Chicago, Houston, Denver, Los Angeles, San Francisco, Portland, and Seattle might have had access to these tests. But what of women in Appalachia, or the Four Corners region in the Southwest, or more generally in rural or other relatively remote locations? Would Yale University, for example, have had any incentive to provide access to the BRCA tests to these women in these far‐off locations? Or to provide genetic counseling where the women lived? Or to lobby state Medicare administrators or private insurance commissioners to cover the test? I think that unlikely. Myriad Genetics did all of this, as well as perform outreach to the obstetrics and gynecology doctors throughout the United States so that these primary care doctors were aware of the tests. Myriad did not ace from altruism but as part of their business plan in order to expand the number of patients who received the test and thus maximize the company's revenue. While it may be counterintuitive to some, these circumstances may have been the most effective way not only to promulgate the BRCA tests but also to facilitate acceptance of genetic diagnostic testing for other diseases, showing that in this instance Adam Smith rather than Karl Marx provided the most practical solution to the problem of establishing genetic diagnostic testing as a recognized component of a physician's diagnostic armamentarium.
Fortunately, the significance and impact of recent US court decisions (specifically, the Myriad case) is much less than it would have been ten to thirty years ago. Due to patent term rules, most patents (and applications) on isolated DNA filed in the heyday of the Human Genome Project (approximately 1998–2001) are near the end of their actual or potential term; indeed, a recent study shows that the number of granted patents having at least one claim reciting an isolate DNA comprising a gene peaked in 1999 and has been dropping since 2005 (Graff et al. 2013, "Not quite a myriad of gene patents," Nature Biotechnology 31: 404–410)). These recent decisions in the United States have not harmed the biotechnology industry because they retained patent eligibility for species of DNA that show evidence of the "hand of man" and do not occur in nature. These include enzymatically produced copies (cDNA) of cellular messenger RNA and should also encompass the tools of the recombinant geneticist (e.g., including recombinant vectors for cloning and expressing genes in heterologous cells). Most importantly, the U.S. Supreme Court did not overturn its Diamond v. Chakrabarty decision wherein recombinant cells were determined to be patent eligible.
Thus, in many ways the question of patent eligibility for human genes is a philosophical one. However, that does not mean that how we think about patent eligibility for isolated DNA is irrelevant to important questions regarding the usefulness of patents for promoting progress and innovation. Indeed, the most pernicious effects of the current trend in the zeitgeist against patenting has been not that genes have become harder to patent but rather that the ability to patent other natural products has been called into question. It is the extension of these recent decisions on isolated DNA to all natural products that poses the greatest threat to innovation. This threat can be illustrated by a thought experiment: for which of these substances should patent protection be withheld?
• A petrochemical with excellent lubrication qualities isolated in pure form and used as improved motor oil.
• Vitamin B12 isolated from beef muscle, formulated into a medicament used to cure anemia in children.
• The drug penicillin, isolated from a mixture of naturally produced chemicals made by a mold and formulated as a drug to cure syphilis (which is otherwise eventually fatal).
• Human urinary erythropoietin, formulated to treat anemia in kidney dialysis patients.
• The gene responsible for Gaucher's disease, a lipid storage disease, wherein the gene is used to make the missing protein that is administered to children and that cures an otherwise incurable and fatal disease.
The current answer is that none of them are patent‐eligible per se (although there may be ways to claim them that could pass eligibility muster; that remains to be seen). Judge Sweet, the U.S. District Court judge who first ruled that isolated DNA was not patent‐eligible, did so using language carefully crafted to avoid encompassing all natural products into his decision. Specifically, Judge Sweet distinguished isolated DNA as the "physical embodiments of genetic information," a property limited to DNA and not shared by other natural products. (While an enzymatic protein could be characterized as the physical embodiment of catalysis of a particular chemical reaction, that formulation has much less appeal and inherent rationale than Judge Sweet's regarding DNA.) Instead of this careful formulation, the broader language employed by the Supreme Court, as well as the broader rationale the Court used in finding genomic DNA unpatentable, has made it easier to employ that fractured logic to render patent‐ineligible naturally occurring molecules other than DNA.
I would be remiss not to mention the rather comical (but persistent) efforts of former Acting Solicitor General Neal Katyal, who included in the U.S. Government's amicus brief to the Federal Circuit the distinction engine he called a "magic microscope," embodying the concept that if you are able to visualize a natural product (like a genomic DNA molecule) using this mythical microscope then the natural product would not be patent‐eligible, whereas if you could not (e.g., a cDNA molecule) then the natural product could be eligible for patenting. Fortunately, the disdain with which the Federal Circuit greeted this fantasy (particularly from Judge Moore) prompted its quick abandonment as are argumentative distinction as the case moved forward. Nonetheless, both the courts and the U.S. Patent and Trademark Office have adopted this standard de facto even as it becomes the theory that dare not speak its name in legal circles. The philosophical point here is that these substances, and natural products generally, have been deemed patent‐ineligible categorically, which while consistent with (and perhaps even mandated by) the deontological approach imposes a distinction that cannot be flexibly applied to the individual circumstances. Without such flexibility, the law is constrained to use one criterion, that the substance can be found in some form in nature, to decide patent eligibility, instead of making the determination of whether permitting patenting exclusivity satisfies the criteria that the invention "promotes progress" as the U.S. Constitution requires and has a benefit to the public that outweighs any categorical disabilities.
The potential that using this standard for determining patent eligibility will result in negative practical outcomes that no one in this debate desires is illustrated by a 2012 Report from the National Institutes of Health, Natural Product Branch, regarding statistics relating to the number of FDA approvals (a total of 1355) for new drugs falling into the following categories:
Drug type/source Number
Biological (B) 203
Natural product (N) 55
Natural product (botanical) (NB) 149
Derived from a natural product (ND) 298
Totally synthetic (S) 393
Total synthesis/natural product (S*) 176
Vaccine (S) 81
These statistics illustrate the consequences of a general ban on patenting naturally derived products; of the 1355 drugs approved between 1981 and 2010,
• Fifty percent of all small‐molecule drugs approved between 2000 and 2010 are natural products.
• About 75% of antibacterial drugs are natural products or derived from natural products.
• Almost 80% of small‐molecule anticancer drugs were natural products or derivatives.
In addition, only 15% of drugs approved during this time frame were socalled biologic drugs, which are also putatively patent‐ineligible. This, the problems caused by the current interpretation of the law excluding natural product drugs from patent eligibility will be exacerbated in view of reports from every study showing that the percentage of drugs that are biologic drugs has been growing and will be the predominant type of drug developed in the 2011–2030 time period.
Another "thought experiment" illustrating the practical illogic (David can provide his philosophical justifications in the body of the text) of broad natural products patent ineligibility is as follows. Suppose a researcher finds a molecule produced by the human body that causes blood pressure homeostasis, that is, lack of this molecule causes or contributes to the disease of high blood pressure. The logical consequence of the current natural product patent ineligibility standards would be that the closer a drug molecule is to the structure of the molecule as it occurs in the body the less patent‐eligible it would be. Practically speaking, there would be no incentive to modify the molecule to confer patent eligibility on the altered molecule because of the unpredictability of such changes on the molecule, such as its biological activity, half‐life, stability, antigenicity or other biological properties. And there would be even less incentive to develop the molecule as a drug because without patent protection the available regulatory exclusivities would not pass economic muster to sufficiently defray the large development costs (some of which prevent drugs neither safe nor efficacious from being sold and thus provide their own justification).
There is one further pernicious outcome that can be predicted to arise from a ban on natural products patents (including patents on isolated DNA and genetic diagnostic methods based on such isolated DNA). Natural products are almost by nature complex, and an "active principle" isolated from nature is beneficial because it is isolated; Kodak ran an advertisement in the journal Nature in the 1970s showing a scientist in a lab coat holding a 250‐ml flask and standing next to several bushels of green peppers, wherein the content of the flask was the purified "essence of green pepper" equivalent to that substance contained in all the peppers in all the bushels and bushels that the scientist was standing beside. But this very complexity makes it possible for the "active principle" (either as a chemical compound or as a diagnostic genetic sequence) to be "hidden in plain sight" in ways that may be particularly refractory to reverse engineering.
For example, even using somewhat dated "gene chip" technology, genetically diagnostic markers could be encrypted onto a microchip comprising 10000 unique sequences, wherein a computer‐readable bar code would be used to identify the positions of diagnostically relevant sequences on the chip. This form of encryption, which can be random and confounded by the presence of positive and negative control sequences as well as variable numbers and lengths of sequences specific for the gene (or more likely genes) of interest, would be very difficult if not impossible to reverse‐engineer. Even if reverse engineering could be done, it would be difficult and expensive to undertake and thus make it more likely that the innovator would be able to avoid competition (i.e., it would provide unlimited exclusivity to its purveyor not constrained by patent term or burdened by the requirement that the invention be disclosed with the specificity required by the Patent Act). While the possibility that this type of chip could be made exists with or without patents, the absence of patent protection could tip the scales in favor of the extra effort needed and risk entailed in nondisclosure, if the reward of extended "monopoly" is great enough. But particularly for genetic diagnostic inventions the benefits of developing a proprietary database, for which a corporation could provide the economic and marketing wherewithal to expeditiously produce, would result in a "worst of both worlds" outcome: unlimited exclusivity based on undisclosed proprietary information that not only is difficult to replicate but whose existence would inhibit competition. After all, if a company had such a database, its outcome for any particular patient's test would be more accurate (and might identify disease risk–associated genetic variants not available elsewhere) and this would provide little incentive for a physician to choose an alternative provider to perform the test (and even more malevolently, could create a system where the wealthy could afford the best diagnostic testing while the less affluent would be restricted to the more limited assays offered by companies without access to the "innovator's" proprietary database information).
The other aspect of foreclosing patents for certain substances or technology areas categorically is that it upsets a carefully crafted dynamic that has worked extremely well during the biotech era, between "true" innovators (typically university professors or small start‐up biotechnology companies) and more established companies capable of commercializing innovation. Pundits who worry that permitting patenting will harm innovation miss an important point: innovation will happen, particularly in universities, research institutes, and like places, because human nature demands it and regardless of whether patent protection is available. The intelligent ape in us wants to know, and the disparity between how university professors and patent lawyers are paid should establish how powerful the need to know can be. Patenting, and the impetus for patenting provided, for example, by the Bayh–Dole Act in the United States, prevents the fruits of these inventive efforts from mere predation by commercial concerns. The benefits that can be had from a system where private commercialization is encouraged are tempered by the types of corporate shenanigans that raise cogent criticisms of the system. But perhaps it is mere human nature that people (in the corporate as well as individual sense) will want to expropriate technology rather than pay for it, and patenting prohibits (or at least retards) this outcome (if not these tendencies). Thus, paradoxically, limiting patent rights does not free innovation but rather makes it more likely to be kept captive by the entities capable of using such innovation to make a commercial product, that is, not from the power of building a better mousetrap but by being able to outcompete smaller innovators merely by their greater economic prowess and resources. Conversely, patents provide a way for the innovators to protect their innovations and compel corporations to license their inventions, producing revenue that can be used to fund future research endeavors. This useful cycle has resulted in the successes of the biotechnology era and is something that we abandon at our peril.
Thus, in my view patents are a useful tool for achieving these societally beneficial goals, promoting innovation and commercialization, and protecting and supporting individuals who use the patent system to protect the products of their labors from being expropriated by others. David provides a cogent and honest counterpoint to these thoughts. Enjoy reading them.
Kevin E. Noonan
Chicago, Illinois 2014
And now Dr. Koepsell's Preface:
A lot has happened in nearly every respect since I first decided to try to delve into philosophical issues of gene patenting nearly a decade ago. I have learned much, the world has changed, and I have changed. I would very much like to think I have played a role in that change, though chances are things would have changed in almost exactly the same way without my small contribution. When the first edition came out, patenting genes was still a regular part of biotech, and only months after the first edition appeared did a surprising and now‐landmark lawsuit alter that significantly. Little did I realize the nature of the forces that would be involved in what I had originally assumed was no more than an academic exercise, but which became a matter of weighty and heated public debate and finally judicial action.
I first became interested in the subject of gene patents when I began reading up on the topic my future wife was researching: pharmacogenomics. To grasp what she did, I first needed to study the science, and in so doing, I also studied the history of that science. Along the way I read about the Human Genome Project and learned about the practice of gene patenting that it spawned. Having had some experience and interest in general issues of the philosophy of intellectual property (see my 1997 Ph.D. thesis turned 2000 book, The Ontology of Cyberspace), my ears perked up when I first read about the notion of patenting genes. So I dived into the research and thinking, in my ordinary style of philosophical work. Although I sometimes teach ethics, my primary field is ontology, and it is from an ontological approach that I start with everything in philosophy. Thus I began to try to get a grip on the nature of the existence of the underlying objects, some of which are "brute facts" (molecules exist, with or without social institutions or intentionality), and some of which are social objects (like laws, rights, and other parts of "social reality," existing only because of collective intentionality). The book was an attempt to lay all this out and to connect it together into a theory that is somehow connected to notions of "justice," which I argued bridges the worlds of brute facts and social objects.
The conclusions I reached were, I thought, pretty neat. Specifically, I worked out an ontology of "the commons" that I had never heard expressed before, and one that connected nicely with the objects involved to show why artifacts and nature ought to be treated differently, and how to decide what constitutes an artifact and what constitutes nature, and a defense of the viewpoint that unmodified genes were clearly not artifacts. It seemed all the more relevant and interesting, even perhaps somewhat important in light of the then ongoing practice of gene patenting. I was much too focused on the ontological arguments and their seeming relevance to real‐world practices than I was to the scientific and legal terminology with which I was engaging, and this was an error. When the book was released, minor errors I made in using technical terminology from both the science and the law were latched onto by a couple critical reviewers from the Intellectual Property law and teaching worlds and urged as a basis to ignore my substantive arguments. They were right to call out the errors, and I have attempted to correct them in this edition. Regardless, the underlying arguments I had set forth would become, shortly, echoed nearly precisely in the lawsuit that the American Civil Liberties Union (ACLU) spearheaded against Myriad Corp. over the BRCA1&2 gene patents.
For a brief period of time, partly due to lucky timing, I was thrust headlong into the public debates about gene patenting, with the Myriad case leading the headlines. Given numerous opportunities to engage publicly with the issues and ideas I had previously assumed were only academic musings unlikely to alter public policy, and given feedback and counterarguments in those same venues, the general arguments could be more finely honed. This edition attempts to coalesce them.
Perhaps more importantly, in the intervening years since I began my musings about the nature of genes, artifacts, nature, and patents, I came to learn the very personal impact that gene patents have on people's lives. Because the ACLU chose to sue over the patents on BRCA1&2 genes, there was a ready‐made, large, and passionate community (mostly women) whose heredity put them at risk of breast and ovarian cancers but who were basically forced into paying monopolistic prices for the only test available for the gene, which was patented by Myriad Corp. Breast cancer and the threat of inherited tendencies for breast cancer are real. They are not legal sophistry, they are not philosophical musing. They kill people or alter their lives irrevocably.
I began researching and considering the effects of gene patents believing they were potentially a threat to the conduct of science, whose foundational objects I argued were part of a commons‐by‐necessity, but I realized after my book came out that real lives were being harmed by patents on genes. The Myriad case brought together the theoretical with the actual for me, and the dynamics of both the case and the loud and sometimes angry public debate raised my awareness not only about this particular subject but also the power and responsibility of academic research in the sphere of public policy. Suddenly, ideas seemed more important, had relevance outside the academy, and could perhaps make a difference in peoples' lives. I began to interact with the activists who were fighting to liberate genes, to stop companies like Myriad in the courts, and engage not just in the philosophical arguments but in those fights. I joined with authors of amicus (friend of the court) briefs, interviewed and interacted with BRCA1&2 mutation‐positive women who were actively pursuing an end to a practice that I had only previously considered to be an interesting metaphysical conundrum. I also debated Intellectual Property (IP) attorneys and others, primarily with backgrounds in biotech industries, and learning better the nature of their arguments. I came to understand that most of them, including Kevin Noonan who once called me a "liar" on his blog, but who has now drafted the foreword to this edition, that they too generally have the best intentions. Many, like Dr. Noonan, truly expect that without gene patents as they existed until recently, the sort of innovation we need in biomedical technologies would not occur as it should.
Throughout the course of the litigation in Myriad, I remained engaged, continued to speak, to hone my arguments, adding to my list of criteria for something to be a creation (artifact) capable of patent "design" (as well as intention and being man‐made) and finally rejoicing when the decision of the Supreme Court came out as close to what I believed and argued was right as possible. I had seen an academic idea mature and bloom into public policy, real law, enforceable justice. While I realistically believe that the first edition of this book had only a very minor role in what finally happened, I am proud to have played some part, to have foreseen the issues, to argue them honestly from what I think is a rational and logical standpoint, and see that the world can be changed by ideas.
There remain issues to discuss, and not everything about gene patents has been resolved by Myriad. Some still argue that cDNA ought not to be patent‐eligible (in fact I still think it should be under the criteria I have set forth, though there are also arguments to be made that it is not, somehow, "designed" by man). Moreover, we should expect patent attorneys to do their creative best to continue to pursue patents on as much of the genome as they can within the constraints of Myriad. Finally, Myriad Corp. has not given up. They are still suing potential competitors under theories of infringement of parts of their patents that might have survived the ACLU's case against them. We shall see how they are eventually resolved and what the future holds for companies like theirs who profited mightily from gene patents for decades. I describe as much of this recent legal history as possible in this edition.
This book is meant to be a definitive version, sewing up the past five years since the first edition emerged, and so much changed in the world, summarizing that recent history and refining the arguments I originally made, correcting errors, and describing where we are, where we yet may be, and why gene patents as they once were ought never to be again.
August 14, 2014
Mexico City, Mexico
By Donald Zuhn --
Last week, in a letter addressed to the Secretary of the U.S. Department of Veteran Affairs, Senator Bernard Sanders (I-VT) urged Secretary Robert McDonald to use his authority as Secretary "to break the patents on Hepatitis C medications for the treatment of veterans suffering with the disease." Senator Sanders (at right) notes in the letter that as Chairman of the Senate Committee of Veterans' Affairs, he held a hearing in December 2014 regarding the impact of Hepatitis C drug pricing on veterans' access to treatment, and "raised concerns that the price of these new Hepatitis C drugs, specifically Sovaldi, which is manufactured by Gilead Sciences, even when discounted, would preclude veterans from accessing these life-changing drugs."
With regard to Solvaldi, Senator Sanders indicates that the drug is priced at $1,000 per pill, or about $84,000 for a course of treatment, and contends that "[t]his price was not a function of cost. It was, pure and simple, an abuse of monopoly power." As a result of the drug's price, the Senator states that "the concerns I raised last year have become a reality -- VA is being forced to stop enrollment of new patients in treatment because of lack of funds."
While suggesting that one solution to the problem would be for "Gilead Sciences to simply provide the drug to VA at no cost, as they have done abroad in the Republic of Georgia, India, and other places throughout the world with high rates of HCV infection," the letter notes that "the company has not stepped up to do this for our country's veterans," and declares that "[i]nstead, they have prioritized an outrageous compensation package for Gilead's CEO John Maitin, valued at over $190 million, including stock options and shares."
Senator Sanders proposes an alternative course of action to Secretary McDonald, asking the Secretary "to utilize federal law, specifically 28 USC § 1498, to break the patents on these drugs to authorize third parties to manufacture or import them for government use." The Senator concludes that "I cannot think of a more clear-cut situation where the government use provision should be applied," adding that "[o]ur nation's veterans cannot, and should not, be denied treatment while drug companies rake in billions of dollars in profits."
In the letter, Senator Sanders suggests that Secretary McDonald utilize 28 U.S.C. § 1498. Section 1498(a) of Title 28 provides that:
§ 1498. Patent and copyright cases
(a) Whenever an invention described in and covered by a patent of the United States is used or manufactured by or for the United States without license of the owner thereof or lawful right to use or manufacture the same, the owner’s remedy shall be by action against the United States in the United States Court of Federal Claims for the recovery of his reasonable and entire compensation for such use and manufacture. Reasonable and entire compensation shall include the owner’s reasonable costs, including reasonable fees for expert witnesses and attorneys, in pursuing the action if the owner is an independent inventor, a nonprofit organization, or an entity that had no more than 500 employees at any time during the 5-year period preceding the use or manufacture of the patented invention by or for the United States.
Nothwithstanding the preceding sentences, unless the action has been pending for more than 10 years from the time of filing to the time that the owner applies for such costs and fees, reasonable and entire compensation shall not include such costs and fees if the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.
For the purposes of this section, the use or manufacture of an invention described in and covered by a patent of the United States by a contractor, a subcontractor, or any person, firm, or corporation for the Government and with the authorization or consent of the Government, shall be construed as use or manufacture for the United States. . . .
A discussion of the history of § 1498 can be found at pages 10-14 of Zoltek Corp. v. United States (Fed. Cir. 2012). The opinion notes that a precursor to the section was initially enacted by Congress in 1910 in response to the Supreme Court's decision in Schillinger v. United States (1894), where the Court held that patent infringement was a tort for which the Government had not waived sovereign immunity, and as a result, determined that a patentee lacked a remedy for infringement by the United States. In William Cramp & Sons Ship & Engine Bldg. Co. v. Int’l Curtis Marine Turbine Co., 246 U.S. 28 (1918), the Supreme Court applied the 1910 Act to the issue of patent infringement by government contractors who constructed warships for the U.S. Navy during World War I, finding that the 1910 Act did not shield the contractors from infringement. The Acting Secretary of the Navy, Franklin D. Roosevelt, responded to the Court's decision by writing to the Senate Committee of Naval Affairs that:
[I]t seems necessary that amendment be made of the Act of June 25, 1910 [as] the decision is, in effect, . . . that a contractor for the manufacture of a patented article for the government is not exempt . . . from injunction and other interference through litigation by the patentee[, and as a result] manufacturers are exposed to expensive litigation, involving the possibilities of prohibitive injunction payment of royalties, rendering of accounts, and payment of punitive damages, and they are reluctant to take contracts that may bring such severe consequences.
Acting Secretary Roosevelt proposed an amendment in which the Government waived sovereign immunity for its own unlawful use or manufacture of a patented invention, but also assumed liability when its contractors did so for the Government.
By Donald Zuhn --
Several patent offices, including the European Patent Office (EPO), United Kingdom Intellectual Property Office (UK IPO), World Intellectual Property Organization (WIPO), and Israel Patent Office (ILPO), have recently issued warnings to applicants and practitioners regarding invitations or requests to pay fees that do not come from those patent offices and that are unrelated to the processing of applications at those patent offices. The fraudulent notices purport to offer registration or publication services that are not connected to those patent offices or to any of the official publications distributed by those offices. In its warning, the EPO notes that the firms distributing such notices use names, abbreviations, and logos that are designed to make it appear that the notice has been issued by an official source, and that frequently, the notices bear a confusing similarity to documents that are actually issued by the EPO or WIPO in order to give the impression that the firms distributing the notices are acting on the behalf of the EPO or WIPO. The EPO warning advises applicants and practitioners that (emphasis in original):
Despite the misleading official look of such invoices, the services offered by these firms are unrelated to the processing of European patent applications and PCT applications by the EPO and WIPO. There is therefore no obligation to pay any invoice issued by these firms for the processing of your patent application by the EPO and WIPO. Moreover, any payment made to these firms will have no legal effect whatsoever in proceedings under the EPC and the PCT.
The EPO warning also provides 26 examples of notices that have been issued by the following firms or organizations requesting payment of "fees":
• IP Data
The warning from UKIPO includes an example of a notice from OHIM-Organization for Harmonizing in the Intern. Market.
The warning from WIPO includes a list of 91 notices requesting payment of "fees".
(We have also collected copies of notices requesting "fees" that were sent by Comm Ctr Ind Trade, CPTD - Central Patent & Trademark Database, IP Data, Patent Trademark Register, USTMS - United States Trademark Maintenance Service, UPTS, WDTP, and WIPT.)
The EPO warning concludes by noting that "[o]nly the EPO can publish and register European patent applications and patents with legal effect, and it does so automatically," and "[s]imilarly, the International Bureau of WIPO alone is responsible for the international publication of PCT applications." The EPO advises applicants and practitioners "to read carefully the content of any invitation to make payments in relation to your patent applications and patents."
Hat tip to the Reinhold Cohn Group for alerting the patent community to the warnings issued by the EPO, WIPO, UKIPO, and ILPO.
By Kevin E. Noonan --
The ACLU championed its efforts in the AMP v. Myriad case as being another instance of the group fighting for the rights of the many and the powerless against corporate America and the oligarchical few. In a paradox, it now seems that the fruits of their efforts are to have empowered just those whom it has traditionally opposed, and that the question of whether personalized medicine will become widely available is in the hands of insurance companies and large diagnostic testing providers (who traditionally have not needed to rely on patent protection in view of their economic clout).
To better appreciate the irony it is useful to compare the history of the most successful personalized medicine effort to date, Myriad's BRCA gene tests for breast and ovarian cancer, with an alternative history premised on the Supreme Court's Myriad decision being rendered 10-15 years earlier that it was. Absent the prohibitions produced by the Myriad decision, Myriad had its patent exclusivity to rely upon in building its BRCA gene testing business. This began in 1997, three years before the announcement of the results of the Human Genome Project. At that time, genetic testing was in its infancy, and at best BRCA gene testing was considered "experimental": Myriad did not have anything other than genealogical data showing an association of genetic variants in the descendants of women who had dies of breast cancer, and had identified a few dozen specific variants. The reliability of the testing could also be reasonably brought into question because Myriad detected several "variants of unknown significance" (VUS), where the genetic sequence identified in a particular patient was different from the "typical" genetic sequence, but there was insufficient genealogical information. In addition, women having the BRCA gene mutation who suffer from breast or ovarian cancer are a small subset of the totality of breast or ovarian cancer sufferers, with frequencies in line with other diseases having a heritable genetic propensity.
Into this situation came Myriad, who armed with its patent exclusivity was able to obtain investors who permitted it to grow the business of testing women for the genetic mutations that indicated a high likelihood of developing cancer. (It should also be appreciated that the increased risk of breast or ovarian cancer for women bearing a BRCA gene mutation is much higher than is the case for other cancers, making this an anomaly for genetic diagnostic tests.) The investment was not only in laboratories, lab technicians and supplies; Myriad had to enlist a nationwide network of genetic counselors to provide women with the information they would need should their test indicate a propensity (~90%) for developing breast or ovarian cancer, as well as educating ob/gyn doctors about the test. While the latter can be discounted as marketing, Myriad also had to take on public and private insurers to have them pay for the test, and this needed to be done on a state-by-state basis. Indeed, acceptance of Myriad's BRCA test as being significantly reliable as to deserve coverage varied from state to state over the past 18 years since Myriad's BRCA gene patents were obtained.
None of this was (solely) altruism, of course; Myriad was running a business. But whether society benefited from Myriad's efforts can best be considered by comparison to that alternative history, where Myriad did not have exclusivity over BRCA gene tests.
This history can be predicated on an earlier enunciation of the Supreme Court's decision, or more easily by presuming that Mary Claire King or other researchers cloned the BRCA genes before Myriad and, as they have stated did not protect the genes or diagnostic methods by patenting. Under this scenario the gene sequences would have been freely available to anyone, particularly university and academic medical centers, such as New York University (where Dr. Harry Ostrer, one of the named plaintiffs in the Myriad case, was practicing) or the University of Pennsylvania (where other plaintiffs, Drs. Kazakian and Ganguly were working), as well as commercial entities. However, without patent exclusivity, the only commercial concerns capable of providing the service would have been unlikely to entertain the possibility, due in part to the high hurdles and costs associated with garnering acceptance from payors at that time. (Myriad didn't have a choice because BRCA testing for breast and ovarian cancer was a core business.)
Under these circumstances the role of providing genetic testing would likely have fallen to academic sources. This raises a few problems regarding the goal of making such testing broadly available and affordable. The first is geographic: while residents of cities and other locations that are the sites of major medical centers would likely have had access to BRCA gene testing it is less likely that less geographically accessible areas would have had such access. Women residing in and around Boston, or New Haven, or New York, or Philadelphia, or Washington, or Atlanta, or Dallas, or Houston, or San Diego, or Los Angeles, or San Francisco, or Portland, or Seattle, or Denver, or Rochester (MN), or Madison (WI), or Chicago, or Detroit, or Cleveland, or Buffalo, or Cincinnati, or Pittsburgh or St. Louis would have access. But women in Appalachia, or the Four Corners region of the Southwest, or rural Idaho, or Montana, or Arkansas or the Dakotas, would need the kind of outreach Myriad provided -- is it reasonable to expect any of the hospitals in metropolitan areas far from these more remote (and typically impoverished) regions of the country?
Perhaps more fundamentally, is genetic diagnostic testing as performed by Myriad the best use of academic medical facilities? Academic medicine, like most academic pursuits is involved in discovering causes of disease and developing new treatments. It is also not well adapted to the type of rote performance of thousands or millions of tests under circumstances where no errors are tolerated. It is hard to contemplate university or medical center counsel being comfortable with academic or even clinical labs performing such tests; inevitably, any such testing would come in conflict (for resources, personnel, lab space) with the traditional purpose of such labs and testing, being ancillary to providing optimal patient care. And this is as it should be: patients look to these hospitals and the physicians populating them as being primarily concerned with helping them get well (while acknowledging the reality that finances and in some cases profit enter into the equation).
But if the goal is the widest proliferation of diagnostic genetic testing then the question is, what is the best way to accomplish it. The idea that academic research and medicine will be able to do so is a fantasy for at least the reasons set forth above; more importantly, such researchers are best utilized in identifying the genetic causes of disease. Thus, the question comes down to whether small, academic-based start-up biotech and diagnostic companies or larger, more corporate diagnostic testing labs will monopolize the space. As the Myriad example illustrates, start-ups must have reliable patent protection in order to establish the protocols, networks, and reimbursement infrastructure needed to sustain such a business, while the larger diagnostic companies do not. The economic advantages these larger companies have will typically be enough for them to out-compete a startup, even one with better understanding of the science and technology. This is true upon inspection: for the startup one or a few genetic tests may be the only product they have to sell, while larger, more established diagnostic testing labs have a much larger product list (and much longer history with diagnostic customers) to sustain them while they adapt to a disruptive new technology like genomic testing.
Even with this economic clout success is not certain, because part of the impetus for startup companies such as Myriad to aggressively advocate for payors to reimburse patients for the testing stem from the reality that this is usually the only way such companies will survive. Larger companies have far less motivation for new technology (think Xerox/IBM vs. Microsoft/Apple) even if there is perceived profit in it. One example of this situation is reflected in a paper in Genetics in Medicine from the American College of Medical Genetics and Genomics published February 25, 2015. In this paper, the College provides a policy statement, arguing that payors should be willing to reimburse genetic testing costs even when the effects of these tests on clinical outcome in unclear:
Clinical utility for genetic tests was discussed in 1998 by the US Task Force on Genetic Testing. The Task Force specifically stated that "the development of tests to predict future disease often precedes the development of interventions to prevent, ameliorate, or cure that disease in those born with genotypes that increase the risk of disease. Even during this therapeutic gap, benefits might accrue from testing. "http://www.genome.gov/10001733. In the broadest sense, "clinical utility" refers to the likelihood that a given intervention (in this case, genetic information) will lead to an improved health outcome (http://www.phgfoundation.org/tutorials/clinicalUtility/) or to whether a test can provide information about diagnosis, treatment, management, or prevention of a disease that will be helpful to a consumer. http://ghr.nlm.nih.gov/handbook/testing/validtest. Establishing an etiological diagnosis is generally asserted to no longer be sufficient to claim clinical utility. Further, evidence that physicians change their management of a patient based on an etiological diagnosis is said to lack clinical utility unless clinical outcomes research has demonstrated that such changes in an individual's treatment will result in benefit. http://www.palmettogba.com/palmetto/moldx.nsf/MolDX_Manual.pdf. Moreover, coverage decision-making policy is now driven by a narrowed perspective that clinical benefit accrues only to the individual receiving the services. [emphasis added]
The College disagrees with this "narrow view" that only tests directly related to improved clinical outcomes should be recompensed. The article expresses the view that such testing should be considered for its "effects on diagnostic or therapeutic management, implications for prognosis, health and psychological benefits to patients and their relatives, and economic impact on health-care systems." Examples include those familiar to anyone who has taken Myriad's BRCA test: not only the benefit of an individual knowing her genetic status, but how that knowledge impacts the likelihood that her relatives will also have the test and know their risk (something for which Myriad charged much less than the widely reported $3,000-4,000 for the BRCA gene test). "Current models" of these benefits "define utility as either (i) clinical benefit specific to the individual receiving the service or (ii) "personal" benefit because it applies to other family members or because the result may suggest interventions that are less well defined. Grosse & Khoury, 2006, "What is the clinical utility of genetic testing?," Genet Med 8:448–450; Robson et al., 2010, American Society of Clinical Oncology policy statement update: genetic and genomic testing for cancer susceptibility. J Clin Oncol 28:893–901. This paradigm "frames the utility of genetic and genomic information too narrowly and fails to acknowledge that information regarding significant genetic risks can enable highly actionable -- indeed, life-saving -- interventions for individuals and their family members," according to the College. Further:
As genetic and genomic information increasingly enables disease prevention and reproductive planning, a narrow focus on medical benefit only to the individual originally tested and diagnosed is apparent as a construct of an obsolete system in which care is provided only to those with overt disease and that clinical benefit can be achieved only when a therapeutic option (i.e., a drug) is available.
Contrary to the predictions of the ACLU and many on its side of the debate, the Myriad decision has not led to an idyllic world of genetic diagnostics (an outcome aided by the Court's other decision negatively affecting the competitive position of startup companies, Mayo v. Prometheus). It will be instructive to see how BRCA gene testing progresses in the aftermath of Myriad "giving up the ghost" on its efforts to maintain a modicum of exclusivity with the Federal Circuit's invalidation of many of Myriad's remaining genetic testing claims. Many companies, including some large diagnostic testing labs, have entered these waters, but it is too soon to know how reimbursement, costs and accessibility are affected.
There is one way that a small company can maintain its exclusivity which forms Myriad's only remaining competitive advantage. Taking advantage of being the "first mover" in this space, Myriad has accumulated a large database of undisclosed "variants of unknown significance" (VUS) in the BRCA genes, the significance of which is not unknown to Myriad. Thus, even now an ob/gyn is faced with the quandary of advising a patient to have the "Brand X" test (which may be cheaper although how much cheaper is an unanswered question) or the Myriad test. If the patient has a widely known BRCA gene mutation all is well (for the physician), because she now knows how to advise her patient. If, on the other hand, the patient's genetic report contains one or several VUS's then the only responsible course would be to have the patient's sample retested (or at least reevaluated). Any benefits accruing from having the test available from parties other than Myriad thus evaporates.
Of course the larger companies have the same capacity and perhaps even moreso, which leads to the possibility that such companies will simply avail themselves of this model and keep all diagnostic testing information to themselves. In either case, the final result of the ACLU's overheated efforts will be that large corporate entities will "own" your DNA, and there will be nothing anyone can do about it. Which is something of a paradox, if not amounting to an irony.
The University of Southern California (USC) Gould School of Law has created an infographic that provides some highlights in the history of patent law, starting at around 500 B.C. and including the first ever recorded document that granted rights to an individual and the establishment of the U.S. patent act in 1790. Additional information regarding the infographic can be found here.