19 July 2013Americas

Leahy demands Myriad “march-in rights”

Senator Patrick Leahy has urged the US National Institutes of Health (NIH) to force Myriad Genetics to license its patents directed to tests for breast and ovarian cancer.

In a July 12 letter to NIH director Francis Collins, Leahy says many women cannot afford the critical tests and so the government agency should enact “march-in rights” under the Bayh-Doyle Act, which can force government-funded patents to be licensed in limited circumstances.

The letter says that although the tests were developed in part with federal funds, the US biotech company can charge between $3,000 and $4,000 for a test.

It comes after the US Supreme Court ruled against Myriad last month, finding that isolated human DNA is not patent eligible and striking down patents owned by the company.

But the court also found that complementary DNA, which is synthesised from messenger RNA, can be patented under US law. Myriad has other remaining valid claims to the tests, meaning it can still enforce patents directed to them.

According to Leahy, who is head of the US Senate’s Committee on the Judiciary, The Bayh-Doyle Act encourages companies to commercialise patents created with federal funds, usually without requiring reimbursement from them.

But he said the act also gives the government tools, known as “march-in rights”, to provide greater access to inventions in appropriate situations.

“The government can require the patent holder to grant a licence to the patent on reasonable terms. If the patent owner refuses, the government can directly license the patent in limited circumstances, including if it ‘is necessary to alleviate health or safety needs which are not reasonably satisfied’ by the patentee.”

Leahy said the health benefits of genetic testing for breast and ovarian cancer are “clear” but he is concerned that “many” women cannot afford Myriad’s tests.

“I encourage you to use your march-in rights in this situation,” the letter urges Collins.

Mercedes Meyer, partner at Drinker Biddle & Reath LLP, said the march-in rights have never been enacted.

Andrew Williams, partner at McDonnell Boehnen Hulbert & Berghoff LLP, added thatLeahy’s assertions did not correctly describe march-in rights anyway.

“They were meant to make sure federal-funded research was being commercialised, and if wasn’t, the government could license the patents to others who would use them.

“He is using the commercial reason – he is trying to lower the price,” he said.

Leahy appears to be “inviting the agency (NIH) to consider whether the rights could apply,” said Bruce Wexler, partner at law firm Paul Hastings. “He is saying ‘I think you should look into this’.”

If the rights were enacted, Meyer said, it could have a chilling effect on the use of government-funded inventions.

“A lot of stuff comes from universities and spin-offs, and corporations won’t want to invest in something they feel they don’t have control over.

“If you use the rights here, why not apply them to prostate or brain cancer, and why not extend them to something else. You create a slippery slope,” she said.

Earlier this month, Myriad sued Ambry Genetic for allegedly infringing 10 patents after Ambry began offering BRCA1 and BRCA2 analysis to test for breast and ovarian cancer on the day of the Supreme Court ruling.

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