Myriad Genetics 18 Months On

Over 18 months ago the Australian Federal Court, in Cancer Voices Australia v Myriad Genetics Inc [2013] FCA 65 (15 February 2013) (“Myriad”), ruled that patent claims directed to isolated genetic materials, such as DNA or RNA sequences, are patentable subject matter.  The decision was subsequently appealed to the Full Bench of the Federal Court with the appeal being heard on 8 August 2013.

While the initial decision preserved the status quo in Australia (i.e., that isolated genetic material meets the “manner of manufacture” patentable subject matter test[1]), any initial jubilation within the Australian biotechnology sector quickly turned to trepidation with the U.S. Supreme Court overturning the U.S. Court of Appeals for the Federal Circuit’s finding in a landmark decision that has essentially ruled that patent claims directed to isolated gene sequences are invalid.  The Myriad appeal was heard less than two months after the U.S. Supreme Court handed down its landmark decision.

So, are the Australian biotechnology sector’s fears well founded, particularly in view of Australian Courts long history of looking towards US Courts for judicial precedent?

Not so, in our opinion.  The Full Bench of the Federal Court is unlikely to overturn the primary judge’s findings, particularly in view of a growing divide between the U.S. patent-eligibility statute (i.e., 35 USC §101) and Australia’s “manner of manufacture” patentable subject matter test.  For example, the most recent U.S. Supreme Court ruling in Alice Corp. v. CLS Bank Int’l 573 U.S. ___ (2014) has set down a procedure for assessing patent-eligibility involving dividing a claim into “eligible” and “ineligible” contributions.  This procedure is plainly at odds with the Australian approach as set out by the High Court of Australia in National Research Development Corporation v Commissioner of Patents [1959] HCA 67 (“NRDC”), which, inter alia, involves assessing a claim as a whole.

Furthermore and while we await the Myriad appeal, the High Court in a recent decision[2] has confirmed the principles of applying the “manner of manufacture” patentability subject matter test set out in the NRDC case in a ruling that finds patent claims directed to methods of medical treatment are patentable subject matter.  The recent High Court decision will certainly be taken into account by the Full Bench of the Federal Court (which is bound by decisions of the High Court) in the Myriad appeal.

Nevertheless, in the meantime and in an abundance of caution, patent practitioners should ensure that all their pending Australian patent applications contain claims other than claims to isolated genetic material, such as, for example, method of treatment or diagnostic claims, which, in the case of the former and in view of the recent High Court decision, are now beyond legal challenge.