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July 08, 2014


I have seen many discussions on “theoretical” claims. Let me give you a real life example. Just got the first Office Action since the guidelines were released. The application is a continuation from an issued patent. All claims were rejected under 101. This result is devastating, since it is also saying that all the claims in the issued patent are invalid. Ultimately, all of my client’s patents obtained over the last 10 years are invalid under this new interpretation of 101. Looking forward, my client has no hope of getting any patents in the future if these guidelines become permanent. Examiners in the Biology Art Groups are rejecting everything under 101. It was hard enough before these guidelines, now it is impossible.

These guidelines mean the end to any new products in the area of nutraceuticals and health food products. People want “natural” products, not synthesized chemicals.

Additionally, I know of a company who bought a patent portfolio, for which they paid several hundred of millions of dollars, to a "natural product" that shows excellent medical results. The compound must be a natural product obtained from the organism because its chemistry is so complex that it cannot be synthesized. What are we to do? Stop looking for the miracle cure synthesized by nature over millions of years. Why even look if you cannot protect your discovery?

Myriad did not say “natural products” were patent ineligible.

I think it might help explain the situation to people who are happy with the Myriad/Mayo/guideline situation if there were a list of examples of previously patented products that would not be eligible under the new regime, along with their indications and economic value, and preferably some anecdotes from patients who had been helped by those products. Similar to the AUTM 'Put a Face on it' project, to show concrete examples of patented products that improve people's lives. And of course pointing out that without patents on such products, the business model of building a company with such products will either change to a trade secret model or just go away. I guess in addition to the private clinic model discussed in the post, there might also be the option of traveling to other countries where companies sell the product because patent protection is still available there. Hopefully the health and safety standards in those countries will protect people who may feel that route is their only option.

Responding to Frohman's comment at 8:45 AM:

I have dim hopes of companies continuing to do R&D simply because they can still get a patent in Europe or Japan or what-have-you. Especially with regard to pharmaceuticals, the U.S. is the market that makes the whole undertaking profitable. The rest of the world imposes statutory price caps on drugs, such that most drug discovery would not be profitable if one could not sell for an outsized profit in the U.S. (See, e.g., http://www.kellogg.northwestern.edu/faculty/dranove/htm/dranove/coursepages/Mgmt%20444/Health%20Affairs%20submission%20Dranove-Kyle.pdf). That is to say, if the only incentive a Pharma innovator has is the lure of a European or Japanese patent, that is little better than no incentive at all, so there will be rather little pharma innovation in such a scenario.

URL to the Dranove course paper did not work (from GrzeszDeL post) above.

Terry Rea makes a strong point when she highlights a need for ways to distinguish patent-eligible from ineligible subject matter. But pointing to initial office actions that differ from previous practice and wishing for the old strike zone won't help. SCOTUS is clearly signaling that CAFC and USPTO have been too willing to grant exclusivity on claims that *have the effect* of blocking access to genetic information, and SCOTUS reached that conclusion because claims granted and enforced such as the method and oligomer claims in Myriad patents *really do* have that effect. Those claims were granted, litigated, and SCOTUS made the calls in Mayo and Myriad 9-0. Complaining won't help. Helping find new rules to distinguish claims that have those preclusive effects from others that protect valuable inventions without those effects would be much more useful.

If you add in Judge Bryson's assertion that the USPTO review of the 2001 written description and utility guidelines was "cursory," and Jonathan Harkness's scholarship asserting that Learned Hand's dicta in Parke-Davis were rookie mistakes, now understood as such (see Judge Sweet's analysis), there's much work to be done to figure out how to claim (and create exclusivity for) antibiotics, hormones, vaccines, and genetic diagnostics without making research an infringement.

Sounds like USPTO's current tactic is to reject claims, and then consider applicants' rebuttals case by case. What is the alternative? Clearer rules? What would those be? Structure plus distinct function not found in nature, with clear limitations that do not preclude research and upstream R&D?

SCOTUS had complete unanimity in calling balls what CAFC and many in the patent bar assumed were strikes. You can complain about the ump, or you can ask for a definition of the strike zone (which the ump has not shown any inclination to provide). Looks like it's up to CAFC, patent prosecutors and litigators, and the USPTO to define that new strike zone. Of course USPTO is going to have to reject claims that once would have passed muster. That's now a given, like it or not.

Bob - try the URL but delete the period and the close parenthesis at the end.

Well, Bob, I don't think unanimity has much value here, in view of the language in both Mayo and Myriad showing how little understanding the Court has about patent law.

The complaints are more with how the Office is implementing what the Supreme Court said, no matter how incoherently. One specific complaint is to blend the "routine, conventional and well-understood" standard of Mayo into Myriad facts - I actually heard the Ariosa lady say that a recombinant vector comprising a novel gene and a heterologous promoter might not be patent eligible if making a vector is routine.

And June Cohan has said that a natural product + natural adjuvant = Funk Bros. Sorry, the Office has gone off the rails - I think there are areas where can agree, but this isn't one of them.

Hope you are well. Let me know offline what's happening at Duke

Myriad discusses the eligibility of “products of nature”. However, the PTO has changed the term to “natural products” in the guidelines. Products of nature and natural products are NOT the same. A combination of natural products is NOT a product of nature since that combination does not occur outside the laboratory.

Everything is a combination of natural products. Steel would be ineligible because it is just a combination of iron and carbon.

I think there is a big difference in how academics and practitioners view the guidelines. Practitioners see the effect of the guidelines put into action on a daily basis. Our clients risk losing their companies because someone at the PTO decides to expand the ruling in Myriad.

"Off the rails" is not all that surprising, and sadly, "I told you so" (not to anyone in particular here) is cold comfort.

The anti-software and anti-business method patent rhetoric is simply too close to being anti-anything patent rhetoric.

The Breyer Two-Step Divide and Conquer Gist-Abstract resulting "weapon" will be used indiscriminately. Count on it.

Analogously, dividing art field from art field has (largely) obscured and distracted the focus of promoting the good that the patent system as a whole provides. Foes of the patent system (and be very wary of those that would hold out that there are none) are only too eager to play off one art field against another. Divide. Conquer. History. Repeat.

Weary -- Did the combination of bacteria in the Funk Bros claim "occur outside the laboratory?"

"this outburst"

Kev, you so funny and so dramatic!

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