invisible-man
1 December 2012Americas

Myriad: Keeping a low profile

“To be honest it came out of the blue: it was a complete shock,” says Ben Jackson of the lawsuit that landed on US biotech company Myriad Genetics’ doormat in May 2009. Led by the American Civil Liberties Union (ACLU), the suit claimed two of the company’s prized gene patents are invalid, unconstitutional and stifle diagnostic testing and research.

Jackson, senior director of legal affairs at Myriad, is referring to the opposition to the firm’s claims over isolating and detecting the BRCA1 and BRCA2 genes, which are strongly linked to most forms of breast and ovarian cancer. With the patents, Myriad can exclusively perform tests that could help determine future treatment of the diseases. The ACLU, wary of what it sees as impinging on human liberty, argues the genes are products of human nature—and should not be patented.

While the suit was unexpected, it was soon billed within the biotech industry as a potential landmark case. At least one life sciences specialist predicted that it would become one of the most important legal battles in the history of the industry. John Sterling, editor of Genetic Engineering & Biotechnology, said it would be a “watershed” event—with the ACLU challenging the entire concept of human gene patenting.

Three-and-a-half years later—and after several twists and turns—the end seems to be in sight. In August 2012 the US Court of Appeals for the Federal Circuit backed Myriad for the second time, after the Supreme Court had remanded the case on appeal.

It ruled that the company’s composition claims to isolated DNA molecules and its method claims to screening potential cancer therapeutics are patent-eligible. It concluded, however, that Myriad cannot patent its claims over comparing or analysing DNA sequences. For the second time the ACLU is appealing to the US Supreme Court, which can choose to reject the case.

When assessing the decision on composition claims Jackson is, unsurprisingly, pleased that the court refused to change the rules on patent eligibility: “It’s pretty straightforward: isolated DNA molecules are markedly different from what exists in nature, having a distinct name, character and use. The court found that our claims are limited to molecules that meet these tests: they are manmade molecules that are not the same as those found in the human body. I think that is the correct test.”

He adds that the ACLU’s arguments on method claims over screening potential therapeutics were “even more misplaced than the other claims. They are clearly patent-eligible and recite the physical steps of manipulating cells, treating them with a material and physically measuring their activities with, or without, exposure to that material. That one wasn’t even a close call”.

“THE COURT CONSTRUED THE WORD ‘COMPARING’ NOT TO INCLUDE ANY SORT OF PHYSICAL LABORATORY OR COMPUTATIONAL ANALYSIS—SO IN THIS RESPECT THE RULING WILL NOT BE MUCH OF A HINDRANCE.”

But, in contrast to predictions from others, he doesn’t see the current gene patent cases having a dramatic effect on the industry. “The heyday of gene discovery is long passed. In June 2000, the Human Genome Project published the first draft of the human genome and that created a large source of prior art for anyone trying to claim the new discovery of genes.” The project, overseen by research institutes in countries including the US and UK, was completed in 2003 and identified virtually all of the 20-25,000 genes in human DNA.

“Even though there are a lot of existing so-called gene patents, I think that as we go forward over the next 10 years or so, the number of unexpired gene patents will drastically reduce. As far as the discovery of new, wild-type genes goes, most of that essentially stopped in about 2000. So you can count 20 years from there, and any gene patents for wild-type human genes going beyond, say 2020, will be very few and far between.”

To reinforce his point about the minimal impact of the ACLU suit, Jackson says the disputed patents at stake will expire by December 2015. So, as far as the case’s lasting impact or importance goes, he doesn’t see much in it. “That is, in the field of human genetics. In other fields, where new genetic discoveries are still being made, such as bacteria, plants and animals, it could be a different story.”

In the decision in August, it was a case of two out of three victories for Myriad. The court denied the company the right to patent method claims over comparing or analysing DNA sequences. The judges ruled that such claims include “no transformative steps and cover only patentineligible abstract, mental steps”.

While Jackson disagrees with the conclusions, he says the implications of this decision may also be rather low key. “The court understood the claims to encompass activities that could be fully performed in the human mind—and had a problem with that, striking them down. In that sense, it could end up being a fairly narrow decision because a typical patent claim does not encompass activities that are purely mental. I don’t know if it will really have that much impact.”

He adds that the court construed the word ‘comparing’ not to include any sort of physical laboratory or computational analysis—so in this respect the ruling will not be much of a hindrance. “I don’t think that patent claims of that structure with that alleged defect are going to be very common.”

Jackson’s attempts to play down the lawsuit’s importance for the future of gene patenting reflect, to a large degree, the company’s low profi le. To date, it has litigated only in the US and Jackson admits that Myriad has been “pretty fortunate” with court battles.

“The ACLU suit is the first one in a very long time that’s been of consequence and, once it’s done, I don’t know if we will see much more. At least, I don’t foresee anything. I don’t know why this is, but I think we have quietly gone about providing an excellent test that helps doctors and patients to understand the risk of hereditary cancer.”

Solutions for clinical problems

As with any company building a business around patents, such tests have their beginnings in the research and development (R&D) process. Myriad has a “pretty large” R&D group that is well funded, Jackson says. “Our scientists think about clinical problems that need solutions, and when they identify a problem—and that might follow literature searches—they devise a study and look for an academic partner to collaborate on that study.”

Almost all studies Myriad carries out involve this collaboration, mainly because large hospitals and academic institutions are the primary source of patient samples that are vital for the research. He says if compelling data that warrant further research emerge from the study, Myriad devises further studies, either refining the first set of results or, if the data are good enough, clinically validating that discovery to show that it works.

After that first study—where the discovery is made—Myriad begins thinking about filing its first patent. “I have regular meetings with senior members of staff and we evaluate whether to file a patent application. In most cases we do. Because we do all of our prosecution in-house, our costs of filing a US provisional patent application are very low. So we file a lot of those.”

A US provisional filing is not examined but enables companies to fully disclose their inventions and obtain a priority date for that invention. “Typically, that will come within a few months of the discovery but, in some cases, it could be weeks. After the provisional, you have one year to file a US utility application that would be examined. In the full application, you claim priority back to the date of the provisional filing.”

During that interim year Myriad carries out more studies to confirm that the discovery is a “true scientific phenomenon and that we have discovered something of value (scientifically and clinically)”. “If, during that year, the science is borne out, we file either a US utility patent application or a Patent Cooperation Treaty application,” Jackson says, which provides a streamlined approach for filing patents in multiple jurisdictions.

To date Myriad owns, or licenses, 193 patents that constitute a diverse group, according to Jackson. “But everything relates to molecular diagnostics— gene expression signatures; panels of genes the expressions of which can be measured to determine some sort of clinical feature of a patient. Prognosis for cancer is one we are working on a lot, and more platform or technical inventions—ways in which we do sequencing. It’s a broad range.”

One of the most pressing questions Myriad must answer is whether to license patents as well as relying on its own inventions. Jackson says the company has an active licensing programme, with the company usually signing a new deal every quarter.

This decision-making process, he says, can be long but the ultimate drivers are the science and the market. “Those are fairly objective realms, especially the science. If the science is compelling, it can drive a decision pretty quickly. It then comes down to whether it’s a market that is worth our time and investment. Again, that’s fairly easy to assess—there are lots of objective ways to try to assess that market.”

“FOR PEOPLE WHO WILL LISTEN WITH AN OPEN MIND, WE HAVE A GREAT OPPORTUNITY TO PROVIDE A COMPELLING RESPONSE TO THE ACLU’S SIMPLISTIC RESPONSE.”

The typical sources of licensing agreements are small start-ups and universities, and Jackson says there are “definite” advantages of working with others. One is that although the company has a “very robust” R&D group, resources are limited. By looking externally at small start-ups and universities, and the technologies they are developing, Myriad can broaden the range of potential products it can develop. “In some cases the technologies that come to us are fairly mature—so we don’t have to do all of the initial discovery. In other cases the technology is truly nascent and there is a lot of work that needs to be done.”

On the flip side for Myriad, if it licenses technologies that others have developed to a large degree, there can be a risk that the work does not meet the company’s standards. “So we might have to revisit some of that initial work. There’s a heavy amount of due diligence that needs to be done to ensure that the background work was done properly.”

He says there are also the “general issues” of having to answer to a licensor, especially in the case of universities, which typically will not hand over patent prosecution for a technology. Myriad does 99 percent of its patent prosecution in-house but when it licenses patents, it gets a lot of “pushback from those parties”, Jackson says.

“I think that universities like to hold their patents closely to control the prosecution themselves. I like to think this is not because of questions over our competence in prosecuting patents. I think it’s a very important asset for them, and even though they are giving away an exclusive licence they don’t want to hand over control of that asset. Smaller companies are often more openminded about handing over patent prosecution.”

For Myriad’s consumers, the primary disadvantage of licensing is that it increases the ultimate cost of the product. If it’s developed in-house, typically there won’t be a royalty burden or, if there is, it will be minimal. Under licensing, there will be a royalty burden—upfront payments that are put at risk if the particular technology doesn’t work out. “So, overall, there is a significantly higher cost for licensed technologies.”

During discussions of Myriad’s approach to R&D and licensing, one word keeps coming up: “typical”. Myriad sees itself as a normal biotech company, one that seeks to distance itself from any kind of controversy. This is especially true of the company’s response to the ACLU, which has led protests against Myriad that use slogans such as “hands off my genes”.

“For people who will listen with an open mind, we have a great opportunity to provide a compelling response to the ACLU’s simplistic approach. This response should be: ‘don’t worry, we’re not patenting your genes’. We are doing a little bit but we are being cautious, and being very deliberate about how we respond to erroneous and demonstrably untrue allegations.”

While Myriad’s response may be only tentative, it stands much firmer on its view of the benefits it believes its tests bring. “The patents in this case have allowed greater patient access than if this case was not exclusively provided by Myriad. As much as the other side wants to paint Myriad as a bad apple and an example of what’s wrong with the system, I would say the opposite: these BRCA patents and Myriad’s handling of them show exactly how the patent system should work.”

For a company that likes to keep a low profile, Myriad has been firmly in the spotlight for more than three years. But with the unpredictable nature of the ACLU lawsuit so far, it is certainly not a given that the most recent favourable decision for Myriad will allow it to ease back into the day job any time soon.


More on this story

Americas
15 April 2013   Myriad Genetics will deliver an oral argument at the US Supreme Court today defending its patents covering isolated human gene sequences linked to breast and ovarian cancer.

More on this story

Americas
15 April 2013   Myriad Genetics will deliver an oral argument at the US Supreme Court today defending its patents covering isolated human gene sequences linked to breast and ovarian cancer.