A hostile response to the USPTO’s guidelines

Anyone who attended the 2014 BIO International Convention in San Diego in June was left in no doubt about which subject is dominating discussion among IP lawyers working in the life sciences: the patent eligibility of natural products in the US following the Myriad and Mayo cases.

The US Patent and Trademark Office (USPTO) was therefore probably unsurprised when its request for comment on the guidelines it issued following those court decisions prompted an avalanche of replies. It may have been more surprised by how negative many were.

For those unfamiliar with this particular controversy, it begins with Section 101 of Title 35 of the US Code, the title covering patent law. The section states that: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.”

However, the law relating to subject matter eligibility is changing fast because of a number of recent court decisions, including Association for Molecular Pathology v Myriad Genetics, Inc (Myriad) and Mayo Collaborative Services v Prometheus Laboratories, Inc (Mayo).

To keep up with these changes Andrew Hirshfeld, the USPTO’s deputy commissioner for patent examination policy, issued a guidance memorandum in March this year titled Guidance For Determining Subject Matter Eligibility Of Claims Reciting Or Involving Laws of Nature, Natural Phenomena, & Natural Products and designed to implement a new procedure to address the changes in the law relating to subject matter eligibility.

The USPTO then asked members of the public to submit their written comments on the guidance by July 31. “The office would like for members of the public who believe that the Supreme Court decisions could be implemented in an alternative manner from the approach taken in the guidance to submit written comments presenting their alternative approach and the legal rationale for the alternative,” it said.

“The public is also invited to suggest additional examples for use by the Office to create a more complete picture of the impact of Supreme Court precedent on subject matter eligibility, and to provide comments on the subject matter eligibility of particular claims, including the sample claims discussed at the 2014 BIO International Convention,” it added.

Professional views

There was no shortage of responses. IP organisations and other associations, academic and research institutions, law firms, companies and individuals all weighed in with their comments.

Of these, the one that has received most publicity has been from a group of 12 national and regional biotechnology industry associations including the UK BioIndustry Association, BIO Deutschland, EuropaBio and the Japan Bioindustry Association.

As LSIPR reported, after its response was submitted, the group suggested that establishing the guidelines will stymie innovation by acting as a disincentive for investment in biotechnology research and development.

“Internationally harmonised, science-based regulatory and legal frameworks are important for competitiveness and innovation to ensure faster and more equitable access to new biotech products and processes for patients, farmers and consumers around the world,” the group said.

By contrast, the USPTO’S guidance will be a “significant departure from internationally accepted norms of patentability”, particularly with regard to industrial, agricultural, and pharmaceutical preparations of naturally-derived substances, compositions and processes.

“Inventive preparations based on naturally-occurring substances have historically been of great importance in biotechnology, and innovation in this area has been spurred, at least in part, by the availability of patent protection,” the group said.

“By singling out naturally-derived biotechnology inventions for special, disfavoured treatment, the guidance would establish peculiar disincentives for investment in research and development of entire categories of biotechnology,” it added.

According to the submission, the group’s member companies have already received rejections from the USPTO for patents directed at pharmaceutical formulations having purified naturally-occurring substances as active ingredients, diagnostic laboratory procedures, and other inventions that were neither considered nor discussed in the US Supreme Court’s Myriad and Mayo decisions.

“Such rejections under the new guidance, if they were to become systemic, would seriously impair investment incentives in new, socially beneficial technologies,” the group said.

Other submissions were equally forthright. UK-based pharmaceuticals company GlaxoSmithKline (GSK), in its letter, said that “Denying patent protection to naturally occurring compounds … will disincentivise research on natural products, adversely impact the development of new medicines, and negatively impact global health.”

The guidance is not supported by case law, improperly extends the holdings of Myriad and Mayo, its factor-weighing test breaks from former USPTO guidance and it effectively creates a new legal standard, said the company.

“GSK requests that the office issue new guidance regarding patent-eligible subject matter under 35 USC §101 that adheres to established case law and does not impermissibly expand the judicial exceptions to patent-eligible subject matter under 35 USC §101,” concluded the letter, which was signed by Charles Kinzig, GSK’s vice president, patent litigation and IP policy, North and South America.

Switzerland-based pharmaceuticals company Novartis was equally hard-hitting. It shares the view of the many other stakeholders who have submitted comments that the USPTO has misinterpreted the explicitly narrow holdings of the Myriad and Mayo cases, applying them to a far broader range of subject matter than was ever intended, and overstepping the bounds of the role with which the office has been entrusted.

“However well-intentioned, the result of this guidance is the creation of new substantive law that neither Congress nor the courts have endorsed, that creates undue burdens on patent applicants operating in the biopharmaceutical field, and which has already left a trail of confusion and uncertainty that, if not corrected, will take years for the courts to sort out,” Novartis said.

“Subject matter eligibility cuts to the very heart of the patent system and law-making in this area has a profound impact on the scope and direction of innovation.”

“On all counts, the loser is innovation and its expansive array of beneficiaries, including patients who, like us, depend on the strong incentives that patents provide to ensure a robust future of medicine.”

The conclusion of the submission, signed by Corey Salsberg, senior legal counsel, IP litigation and policy, at Novartis International AG, was that subject matter eligibility cuts to the very heart of the patent system and that law-making in this area has a profound impact on the scope and direction of innovation.

“Such an undertaking should be left to Congress and the courts, whom the public has entrusted with this role, and in all events cannot be taken lightly,” said Novartis. “We believe it only proper for the office to withdraw its inconsistent guidance, and to issue new guidance only after careful reflection and due consideration of the points raised above and in other stakeholders’ comments.

“Should the office maintain its present approach, we at least request that it duly and carefully consider our and others’ suggested revisions,” it added.

Blunt responses

Away from the corporate sector, there were similarly forthright submissions from academic and research institutions, including one from four relevant US bodies: the Association of University Technology Managers, the Council on Governmental Relations, the Association of American Universities and the Association of Public and Land‐Grant Universities.

“We are deeply concerned about the USPTO guidance memorandum and its unwarranted, as well as legally inconsistent, broad changes in examination practice,” their letter said.

“The ability of our members to bring the benefits of research to the public is significantly decreased if patents on valuable and meritorious university technology cannot be obtained. Secure and predictable protection is a prerequisite for our licensees to justify substantial investments in commercialising university discoveries.

“The guidance adversely and unnecessarily impacts our ability not only to license and commercialise future discoveries and inventions, but also the validity of many existing patents for products, particularly in life science areas which make up the majority of university patents,” it added.

Six law firms and around 40 individuals added their voices too, and again there was broad agreement. As an example, the Washington DC-based Sutherland Asbill & Brennan LLP added to the criticism.

“Joining in the apparent consensus of most IP experts in this practice area, it is our firm belief that the USPTO’s guidelines are based on an incorrect and overly broad interpretation of what no longer may be deemed patent-eligible subject matter based on relevant Supreme Court decisions discussed herein,” said its submission.

“In the words of the Mayo court: ‘This court has repeatedly emphasised a concern that law not inhibit future discovery by improperly tying up the use of laws of nature and the like. Rewarding with patents those who discover laws of nature might encourage their discovery’,” added the letter, which was signed by Sutherland associate Jana Nelson.

“In addition to the guidance being based on a fundamentally flawed analytical framework, it directly conflicts with the USPTO’s constitutional mandate to promote science and the useful arts. Notably, by restricting the scope of patent-eligible subject matter the guidance threatens to effectively suppress innovation in industries relating to biotechnology and biopharmaceuticals,” it added.

The USPTO has said it will issue an update to the guidance “once it has carefully considered all feedback and the developing law regarding subject matter eligibility”.