Australia Court Says Isolated DNA Patent Eligible, Slams SCOTUS

Yesterday it was reported that the number of Americans submitting a claim for unemployment rose again this week. This morning news broke that the U.S. economy added only 142,000 jobs during the month of August, which was far less than the 225,000 jobs expected to be added during August. According to the Wall Street Journal, “around 60,000 people dropped out of the labor force in August, pulling the labor-force participation rate down to 62.8%.” Job creation at these levels are barely enough to keep up with the population growth, and a far cry from the 300,000+ jobs created that would signal a truly healthy and healing economy.

On the very same day that the U.S. jobs report shows unexpectedly weak growth, the Federal Court of Australia issued a ruling directly opposite to the ruling rendered by the United States Supreme Court relative to gene patents. In Yvonne D’Arcy v. Myriad Genetics, Inc., the Federal Court of Australia ruled that Myriad’s claims to isolated DNA are patentable under the laws of Australia. That is the correct ruling, and it is the ruling the U.S. Supreme Court should have reached in Association of Molecular Pathology v. Myriad Genetics. As the patent eligibility laws of the U.S. become increasingly inhospitable to high-tech innovative businesses we can expect more job losses and worse news for the U.S. economy on the horizon.

As I recently explained in Erosion of Patent Rights Will Harm the U.S. Economy, the United States became the dominant world power in the biotechnology industry because of an expansive view of patent eligibility.  Thanks to the U.S. Supreme Court’s decision in Diamond v. Chakrabarty, which ruled that genetically modified bacteria could be patented, the biotechnology industry was born. In fact, Chakrabarty was critical to the very foundation of the U.S. biotechnology industry. “By finding that subject matter derived from nature is eligible for patenting if it is modified by man into something new, useful and unobvious, the Court provided assurance to biotech companies and their investors that emerging technologies are protected by the patent system even if they could not have been foreseen when the system was created 200 years earlier,” explained Jim Greenwood, President and CEO of the Biotechnology Industry Organization, in June 2010 on the 30th anniversary of the decision.

It is well documented throughout history that companies will locate in countries where the technology and innovations they are working on enjoy the most protection. Innovation just doesn’t happen, it requires hard work, real dedication and in the biotech sector a lot of funding over a prolonged period of time from investors. And let’s be perfectly honest — without the investments in these early stage companies the innovations that the public and media want open to society would never have happened. The testing and screening that the ACLU and others are arguing to be open wouldn’t have existed.


Innovation is not inevitable and anyone that tells you otherwise is simply lying to themselves or ignoring history and the human condition. Incentive is necessary to drive innovation; both from the inventor side and from the investor side. Paradigm shifting innovation occurs where solid technology can be meaningfully protected. This causes investors to be interested because of the potential competitive advantage, which means they provide the capital necessary to move forward. And let’s not kid ourselves, the innovations we want in the pharmaceutical and biotechnology sectors require investment of hundreds of millions of dollars, if not tens of billions of dollars in some cases. No one in their right mind would provide that kind of funding without some expectation of a suitable return on the investment — no one!

With the decision earlier today from the Federal Court in Australia it becomes inescapably clear that the United States is no longer a stable, welcoming business climate for a large portion of the biotechnology industry. Change won’t happen overnight, but in the wake of this decision biotechnology companies, particularly start-up companies, will increasingly move to or simply form in Australia and other countries that recognized the patentability of these important innovations. This is terrible news for an already lethargic U.S. economy. The biotechnology sector had been one of the brightest spots in a terribly under performing broader economy. The median salary for those employed in the biotechnology sector ranges from $70,000 to $99,000 depending on the size of the company. Those are high paying jobs that far exceed the low wages for the service jobs that are overwhelmingly those that are being created during the Obama recovery.

But the most interesting aspect of this story isn’t the fact that there will be a sucking sound of jobs leaving the U.S. as our laws become increasingly inhospitable to biotechnology companies. Instead, what is particularly interesting is that the Federal Court of Australia went out of their way to slam the United States Supreme Court. The last five substantive paragraphs of the ruling of the Federal Court of Australia are compelling:

214. The isolation of the nucleic acid also leads to an economically useful result – in this case, the treatment of breast and ovarian cancers. This is surely what was contemplated by a manner of new manufacture in the Statute of Monopolies. As Moore J explained in the Federal Circuit, ‘it is not the chemical change alone, but that change combined with the different and beneficial utility which leads me to conclude that small isolated DNA fragments are patentable subject matter’.

215. The US Supreme Court rejected the claim over isolated nucleic acids for much the same reasons as those pressed by the appellant in this case. It is difficult to reconcile that Court’s endorsement of the reasoning in Chakrabarty, with its rejection of isolated nucleic acid as eligible for patentability. With respect, the Supreme Court’s emphasis on the similarity of ‘the location and order of the nucleotides’ existing within the nucleic acid in nature before Myriad found them is misplaced. It is the chemical changes in the isolated nucleic acid which are of critical importance, as this is what distinguishes the product as artificial and economically useful.

216. The fact that, hypothetically, if the isolated DNA sequence were replaced into the cell it would express the same proteins is irrelevant. Following Chakrabarty and NRDC, the isolated nucleic acid has ‘markedly different characteristics from any found in nature’; Myriad did not merely ‘separate that gene from its surrounding genetic material’. It should make no difference that in Chakrabarty there was an “addition” (of the plasmids) to the natural product (the bacterium); this is not the appropriate test. Myriad’s claim, properly considered is not, as the US Supreme Court considered, concerned ‘primarily with the information contained in the genetic sequence [rather than] with the specific chemical composition of a particular molecule’.

217. The reasoning of Lourie and Moore JJ of the Federal Circuit is persuasive. It accords with the High Court’s reasoning in NRDC and Microcell. The US Supreme Court accepted that cDNA is patentable. It rejected the isolated nucleic acid of claim 1 because it accepted wrongly, with respect, that the isolated nucleic acid is a “product of nature”. In any event, that exclusion is not in accordance with the principles of patent law in Australia and has been specifically rejected as a reason for exclusion in NRDC.

218. The isolated nucleic acid, including cDNA, has resulted in an artificially created state of affairs for economic benefit. The claimed product is properly the subject of letters patent. The claim is to an invention within the meaning of s 18(1) of the Act.

Additionally, the Federal Court of Australia also directly took on the absurd notion that isolating DNA is akin to snapping a branch off a tree. The Federal Court of Australia explained:

In the decision of the US Court of Appeals for the Federal Circuit, Bryson J (dissenting) drew on a metaphor, likening an isolated nucleic acid and a branch being snapped off a tree. That is inapposite. The branch has not changed – it is simply divorced from the tree, whereas the chemical and physical makeup of the isolated nucleic acid renders it not only artificial but also different from its natural counterpart.


Warning & Disclaimer: The pages, articles and comments on do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of

Join the Discussion

30 comments so far.

  • [Avatar for step back]
    step back
    September 9, 2014 12:51 pm

    Gene, obviously you found a bunch of engineering student geeks sitting around a coffee house sipping the broth of the java beans and you asked them to fix the problem with a mere weekend’s worth of coding on a geriatric computer. No sooner did you give them the abstract idea then did they make it so. It all goes to prove that the Magnificent Nine (aka SCOTUS) were right all along. None of this can be patent worthy! (Said with tongue in cheek of course.)

  • [Avatar for step back]
    step back
    September 9, 2014 12:45 pm

    Eureka. It works.

  • [Avatar for step back]
    step back
    September 9, 2014 12:45 pm


  • [Avatar for Gene Quinn]
    Gene Quinn
    September 9, 2014 12:23 pm


    FYI. I believe I have rectified the comment problem and see why all comments were being sent to spam. Comments should be appearing immediately except in rare cases where they are being held due to the spam filter capturing them.


  • [Avatar for step back]
    step back
    September 9, 2014 08:25 am

    NWPA @22

    SCOTUS has lost respect not only in the esoteric realm of patent law but also in the broader arena of general law.

    Consider for example, the invisible friend under whom business people claim to work as mere employees, the venerable Mr. Corporation.

    When you show up at the office and demand to speak face to face to Mr. Corporation, the proclaimed minions of his eminence apologize that he cannot be seen or spoken to at the moment but as his “agents” they are anointed to speak on his behalf.

    Based on such antics, SCOTUS has declared that Mr. Corporation is people too, He breathes, he bleeds, he fears for his life and yes, he has a Constitutional right to “speak” by means of dispersal of monetary papers. See the Citizens United case.

    Therefore if SCOTUS believes in the physical existence of a “speaking” Mr. Corporation, what could possibly stop them from believing that claims reciting physical inventions are no more than pointers into a world of mere abstractionisms?

    The age of scientifically enlightened judges is over and we are already backing our way into the second Medieval era. If you too can see a breathing, hearing, speaking Mr. Corporation marching in the parade next to the naked Emperor then you too have entered the acid-tripped world of Go Ask Alice.

    For the musical tribute to our times, check out this video:

  • [Avatar for Anon]
    September 8, 2014 08:46 am


    Are comments made over the weekend still in the filter, or are they lost?

  • [Avatar for New Anon]
    New Anon
    September 8, 2014 05:17 am

    Australia has one critical difference – the greatest definition ever as to what constitutes an “invention” – the “manner of manufacture” of the Statute of Monopolies of 1624 and the body of case law that has amplified it. It was the Australian High Court’s decision in NRDC’s Application that exploded any attempt to restrict the concept. As the High Court put it:

    “It is, we think, only by understanding the word “product” as covering every end produced, and treating the word “vendible” as pointing only to the requirement of utility in practical affairs, that the language of Morton J.’s “rule” may be accepted as wide enough to convey the broad idea which the long line of decisions on the subject has shown to be comprehended by the Statute.”

    This magesterial decision remains the bedrock of Australian law, and I can’t imagine the High Court overturning it.

  • [Avatar for Anon]
    September 7, 2014 09:03 am


    Interesting juxtaposition between two errant views: Zaldar from the professed scientific perspective, and Paul Cole from the professed legal perspective.

    Each incorrect in their end synopsis.

    As I pointed out missteps of Paul’s, and Gene has pointed out a few missteps of Zaldar’s, one item that draws my attention is that both Paul and Zaldar misconstrue what the Court is doing. And in a sense, so does Gene.

    By this I mean that Gene mistakes the legal notion of the Product of Nature doctrine to be a too literal “the exact product must be in nature” scientific rule. As I pointed out to Paul, recognizing what the Court is doing requires a synthesis of its multiple teachings on patent law, and in that manner, the Court is indeed painting very broadly, and not at all in a narrow sense (one does not use the section 101 and eligibility if one wants to paint narrowly – this is one reason why followers of the rule of law are upset with the Court’s methodology, and as Gene points out, rightly so).

    But more to the point that I think Gene is missing: the Court is not basing its reasoning on any “scientific truth.” Yes, it is a pity that the Court appears to care less about such. Rather, the Court is using its bully pulpit to make a broad value-based doctrinal stand: patents are meant for some, dare I say, flash of genius that takes building blocks from the warehouse belonging to all men and does something more. Mere isolation itself is not enough. Such is only removing the items from the warehouse. Yes, the Court does recognize that structure has been changed (an error of Paul’s as well as Zaldar’s), but the Court is saying that such change – even if it is creating something that does not exist on its own in nature – is not effectively changing what is claimed from what is in nature. The claim is not enough because the change (a real change is indeed present and recognized) is not the “right kind” of change, the product claimed is effectively the product in nature. To approximate Judge Hand’s view: the change here is not a change in kind, but merely one of degree.

    While touching on a different judicial maxim, the takeaway is analogous: “effectively” merely snipping something out of something else (here) is not enough (and yes, I do recognize the argument that snipping here does create the ability to use the item differently) – just like in Prometheus, recognizing the law of nature at work and merely saying “apply it” was not enough. Enough for what – that is a fair (and far better question) – but to get to that question, I think that a particular set of different questions ring loudly:
    enough for whom?
    Enough for Congress?
    Enough for the country?
    Enough for a Court that wants a different set of laws than the ones Congress wrote?

    Ah, but this set of questions are a political set dealing with law making authority. In direct contrast to Paul’s takeaway, this set is very broad and decidedly not narrowly focused, and the series of Court cases – when viewed together (as I would posit that they must) paint a vastly different legal picture than the one that Paul Cole (and even Gene Quinn) have painted. I am reminded of the proverb of several blind-folded wise men led to different parts of an elephant, and guessing as to the animal by holding only a particular part of the animal. The Supreme Court in Myriad may have been the trunk, the ear, or the tail, but its series of 101 rulings are the elephant (in the room). Just as in Myriad, isolating is not enough.

  • [Avatar for NWPA]
    September 7, 2014 06:03 am

    @stepback >>the Court merely invites its own destruction.

    I agree that in patent law the SCOTUS has lost all respect. I think too that Obama to my mind has lost all my respect despite voting for him twice. The recent Fed.Cir. appointments are clearly ones meant to burn the system down. Lee is no better.

  • [Avatar for MaxDrei]
    September 7, 2014 05:45 am

    Reading Zaldar above, and thinking about “found in nature” I’m reminded of the comments of the English patent judge Robin Jacob about the rain forest in Brazil to the effect that, if you want to hide a leaf, where better than in the rain forest of Brazil.

    It is all very well telling everybody that the cure for disease X is coded on one particular leaf in the forest, visible under X-ray. If you can’t say which one of the leaves it is, that coding is not accessible to anybody, and neither then is the cure . The leaf with the coding on it is “found in nature”, no question, but is that enough reason to deny a patent for a claim to the coding on the leaf?

    In controversial cases, the precise terms of the claim are all-important. The court in Australia was considering a different claim, I understand.

  • [Avatar for Paul Cole]
    Paul Cole
    September 7, 2014 02:10 am

    @ Zaldar

    There are three things you need to do:

    (1) Read Justice Thomas’ opinion in Myriad VERY, VERY CAREFULLY;
    (2) Mark the passages which set out his HOLDINGS;
    (3) Realize that the Justice iis an English Literature major and used the words with precision to indicate what he meant.

    If you do these simple and straightforward things you appreciate that the holding of Justiice Thomas was VERY NARROW AND SPECIFIC.

    This is not rocket science, but an ability to read and care and attentioon helps.

  • [Avatar for Anon]
    September 6, 2014 10:13 pm


    I see three not so small errors in your post at 4 above.

    1) “isolation of the BRCA1 full length gene at least had not been reported in the specification as filed” – just not so.

    2) “Justice Thomas therefore looked at the claim as pure information” – absolutely false. While he does talk about information, that alone is by no means the only thing he talks about, and he talks about structure repeatedly – and in pertinent part, contrasts the allowability of cDNA by way of structure. Perhaps you confuse Scalia’s concurrence which differs from the words of Thomas when you posit that no difference in structure was a driver in the decision.

    3)” unappreciated fact sensitivity of these decisions….you will see that he went to considerable trouble to make an extremely narrow and conservative ruling.” – this is perhaps your biggest blunder, as you confuse the application of law to the facts of the case with the law that can be taken away from the case. It is more than abundantly clear that the take away is expressly not limited to merely “isolated” DNA – but that the takeaway has to do with the Products of Nature doctrine, and that doctrine is – as others note – extensive. Elsewhere, I believe that you have posted that many are living in denial – with all due respect, I think that description pertains here to your view.

    What you also seem to miss is the larger scale historical perspective of the decision coming as it does on the heels of the Prometheus case and the take away there of that “enough” must be done to effectively have something more. The takeaway from the Myriad was not – in fact – a focus purely on “information” as you posit, but rather, that the invention as claimed, even being structurally different, was just not different enough. I would also point out that this rings true in that not all cDNA has been cleared for patent eligibility either – note the discussion on short strands.

  • [Avatar for Gene Quinn]
    Gene Quinn
    September 6, 2014 06:13 pm


    You can disagree all you want but at the end of the day everything I’ve ever written about the Myriad case, their patents and technology is 100% true. I will also caution you that on IPWatchdog we demand truth. You are entitled to your own opinion, but you are not entitled to make up facts or lie about things, as you do in your comment and I discuss more fully below. So if you want to comment here in the future please endeavor to be truthful and refrain from making false statements of fact.

    You say: “The chemical differences between the DNA in the entire genome and the isolated DNA are incredibly small.”

    That isn’t the relevant legal question, which is probably where you go astray right from the start. The scientific reality, whether you want to believe it or not, is that isolated DNA does not occur in nature and, therefore, it cannot in any way be considered a product of nature despite what SCOTUS said otherwise. In other words, the fact that SCOTUS reaches an erroneous and scientifically inaccurate decision doesn’t change scientific reality.

    You say: “More fundamentally however the claim in Myraid was not to an isolated DNA it was simply to the DNA.”

    You are, of course, factually wrong. How or why you would say or believe such an easily proved falsity is curious. This makes everything else you say irrelevant and nothing but falsehoods built on an untruth. Take a look at the claims please, for example see:

    What is claimed is: An isolated DNA coding for a BRCA1 polypeptide, said polypeptide having the amino acid sequence set forth in SEQ ID NO:2. See

    What is claimed is: An isolated DNA molecule coding for a BRCA2 polypeptide, said DNA molecule comprising a nucleic acid sequence encoding the amino acid sequence set forth in SEQ ID NO:2. See

    You say: “The cDNA did not exist in nature before. The DNA did.”

    True, but it is also true to say that the isolated DNA did not exist in nature before it was isolated. You simply cannot argue that scientific truth. Of course, your argument is duplicitous because you ignore this truth by fabricating a lie that the Myriad claims were not to isolated DNA despite the clear, plain and unambiguous terms of the claims. Even SCOTUS acknowledged the claims were drawn to isolated DNA.

    You say: “you are getting the science here wrong.”

    No, it is YOU who are getting the science wrong.

    You say: “The DNA sequence that Myraid tried to patent in any concentration existed in nature before they tried to patent it.”

    Again, a lie. Simply not true.


  • [Avatar for step back]
    step back
    September 6, 2014 05:03 pm

    Courts do not have armies.
    All they have is their words.

    Early on, the wiser of the judges understood that a court gains respect only if it articulates the reasoning behind its decision and it is the force of logic and fact that gains the court respect and from that the power to compel the public to follow its edicts.

    The US Supreme Court opinions in Myriad, in Alice, in Citizens United all lack logic, facts and rational thought process. By consistently putting out nonsense decisions like these, the Court merely invites its own destruction.

  • [Avatar for Anon]
    September 6, 2014 04:00 pm

    MaxDrei at 11,


    Not at all given what is actually happening around us. Mr. Cole’s position may be calling out for reason, but the reality (which is much more risky to ignore) is that such reason would need to be heeded from both sides of the issue.

    It is abundantly clear that such is simply not possible.

  • [Avatar for NWPA]
    September 6, 2014 03:36 pm

    @13: anon. Thanks for that. Wow, Ms. Lee is a slickster. She talks just like the Google people I know. Not by the way silicon valley, but Google. Scary person to have that wants to burn our system down. I can’t believe they let her get away with all those non-answers.

  • [Avatar for zaldar]
    September 6, 2014 02:44 pm

    Honestly I disagree here simply from a chemical perspective. You are an engineer gene not a chemist. The chemical differences between the DNA in the entire genome and the isolated DNA are incredibly small. From your quotes it seems that the Australian court is placing emphasis on the fact that it is economically useful. This is not the test in America. Many things that are economically useful are not patentable – discovered wild plants for example. Mixtures of wild bacteria.

    Chakrabarty is certainly reconcilable as the inclusion of the plasmid is WHAT MAKES the item not the same as what is in nature. The bacteria as a whole is now a new thing. Simply cutting something out of the DNA and isolating it is NOT making a new thing. Cutting it out, putting it in a bacterium and making a new bacterium that does not exist in nature is certainly new.

    More fundamentally however the claim in Myraid was not to an isolated DNA it was simply to the DNA. Thus the DNA in a chemically different environment (like in a bacteria) would still be covered. This was incredibly broad and ridiculous and goes way beyond the vitamin A cases where a purified version of the chemical (to a specific purified state) was what was patented. The cDNA did not exist in nature before. The DNA did. If we are going to be serious about the “if it exists in nature it can not be patented” limitation this case was decided correctly.

    Much like the idea that putting a computer program on a computer makes a “new” machine (which would mean putting a tape in a tape player makes a new machine” you are getting the science here wrong. Yes the chemistry is mildly different if you compare the structures between the un-cut DNA and the cut DNA but so is the chemical structure between a branch and a tree. Simply cutting out the sequence from surrounding sequence is not enough of a difference from the natural product. Just like changing one base might not be enough of a difference.

    Australia may have a different standard that focuses more on economic utility I do not know their law, and their different standard may lead to more industry there. That however is a different discussion. Our standard is that if it exists in nature and is not made by man it can not be patented. The DNA sequence that Myraid tried to patent in any concentration existed in nature before they tried to patent it, especially when it is considered as information and not as a chemical (but as discussed above even when it is considered as a chemical). I would certainly LIKE DNA to be patentable – as it would lead to a larger likely hood of work for me as a biochemical patent lawyer….but that doesn’t change that under our law (where items in existence in nature before patenting or mixtures like in funk brothers of items in existence in nature before patenting) they are not patentable. The conclusory statements with no analysis of WHY in the Australian decision (which I hope I can read somewhere in its entirety) are not persuasive.

  • [Avatar for Anon]
    September 6, 2014 02:13 pm

    Follow up to my post at 1, (and even though it was painful to listen to the political self-grandstanding of several committee members), at about an hour and twenty minutes in per Rep. Collins:

  • [Avatar for Gene Quinn]
    Gene Quinn
    September 6, 2014 12:02 pm


    I did crow a lot when the Federal Circuit got the Myriad decision correct. It seems hardly inappropriate to celebrate it when a court gets both the science and law correct. It also seems completely appropriate to point out that SCOTUS got Myriad totally wrong both on the science and the law. SCOTUS made so many inconsistent and intellectually dishonest statements in Myriad. It was refreshing to see that the Federal Court of Australia pointed out all the fallacies of the SCOTUS decision. It was also very nice to see them agree with what I’ve been saying ever since, which is that there is no way to reconcile Chakrabarty with Myriad.

    According to Mark Summerfield who blogs at Patentology it is possible this case will be reviewed by the High Court of Australia, but unlikely. See:

  • [Avatar for MaxDrei]
    September 6, 2014 05:01 am

    Fail fast, in order to succeed eventually? Sounds a bit risky to me. Can’t you instead succeed directly, and much faster, by revealing to the USPTO, in its current consultation process, the narrow correct way to construe Myriad?

    Paul Cole, above, is already active in that consultation process. He has a track record of success at the USPTO, in changing the MPEP. Get active, give him support now.

  • [Avatar for rudy]
    September 5, 2014 07:45 pm

    Don’t count your chickens, you crowed a lot when the CAFC ruled in Myriad, and they got overruled. May still happen in Australia’s High Court.

  • [Avatar for Moocow]
    September 5, 2014 04:54 pm

    Rick — the US Myriad decision is having a lot more impact on the biotechnology industry than most people would think. Justice Thomas’s careless language about his court’s “long-standing rule against patents on naturally-occurring things” has directly and predictably led to rejections now, in the USPTO, of patent applications on vaccine compositions, industrial enzymes, antibiotic and other medicinal molecules, and a host of other inventions having nothing to do with genes and diagnostics. This is actually going on right now. Biotech companies have closed down research programs on such things because they can no longer get patent protection.
    As far as Australia is concerned, I agree that nothing will change. In Australia, access to genetic testing is available to anyone who needs it under its universal health care system, Myriad’s patents aren’t enforced and there are multiple providers offering testing. Researchers have a robust experimental use exemption. The biotech research and investment climate in Australia is exactly as favorable as is was before this opinion. It’s the climate in the U.S. we should be concerned about.

  • [Avatar for Vance Proust]
    Vance Proust
    September 5, 2014 04:54 pm

    Interesting, much as the CAFC slammed judge Sweet. Let’s see how it plays out on appeal before we get too excited.

  • [Avatar for Gene Quinn]
    Gene Quinn
    September 5, 2014 03:09 pm


    First, I don’t think any of this should be happening, but I think recognizing that it is happening, what that means and trying to figure out strategies for the long haul is prudent.

    Second, I agree with you 100%. Things with biotech and software are clearly headed in an objective bad direction. Destruction of the U.S. patent system at large is the agenda, and biotech and software are just what is in focus at the moment. I think we should put our foot on the accelerator and fail at this stupid experiment as quickly as possible. Fail so bad, so fast, so large that even Members of Congress only interested in getting reelected can understand the consequences.


  • [Avatar for Gene Quinn]
    Gene Quinn
    September 5, 2014 03:05 pm

    Rick G-

    The problem with your analysis as I see it is that DNA sequences that are isolated are by definition different than and modified from what occurs in nature. So the Supreme Court reasoning collapses on itself through inconsistencies and scientific impossibility.

    The supreme Court did say that cDNA is patent eligible, but went on to say that it is only patent eligible if it is not identical to what occurs in nature. Most in the industry are ignoring that part of what the Supreme Court said, but the word “except” has a very real and accepted meaning. So when they say cDNA is patent eligible “except” that means it is not always patent eligible. This presents real problems for the future of personalized medicine because by definition cDNA is man made and not made or capable of being made in nature. Even the Supreme Court recognized that truth. However, if you make something that is man-made and identical to what is in nature no patent for you under Myriad. That will severely stunt research into artificial organs, which out of necessity really need to be identical to nature.

    Furthermore, I think your reading of Myriad is inconsistent with the USPTO reading of Myriad in their proposed guidelines. The USPTO went much further than even SCOTUS. We will see what ultimately comes out in the next few months, but given that the Obama Administration is anti-patent and they want to keep health care costs down I think it is foolish to think that the Myriad/Mayo guidelines will be anything other than a disaster when they are finalized.

    As for whether Myriad had little impact on biotech, that also is not true. About one-third of the biotech industry couldn’t care less. One-third thinks they are better off because it took claims away from Myriad. One-third of the industry that deals in the innovations akin to the Myriad innovation are in a world of hurt. Those are the companies that will be most easily attracted to more hospitable climates. That would be bad from a jobs perspective, but also from a health perspective given that those companies are the ones working on diagnostics.

  • [Avatar for Rick G.]
    Rick G.
    September 5, 2014 02:37 pm

    Thanks for the update. As I understand it, there is still a possibility for appeal here.

    Just so the point doesn’t get lost amongst the frightening scenarios you presented, the specific holding of the US Supreme Court Myriad decision [DNA sequences merely isolated from nature, and not otherwise modified, are ineligible for patent protection] had very, very little impact on biotechnology. Myriad, as everyone knows, is still out there sueing its competitors as if nothing happened. That’s primarily because the fraction of biotech companies whose existence depended on obtaining IP protection for merely isolated DNA sequences is very small indeed.

    I highly doubt Australia is going to see a big surge in the establishment of foreign-owned companies who control the right to isolate or synthesize naturally occurring DNA sequences because “they were first to isolate them.” It’s possible. I would expect that if that happened there might be some pushback from the public.

    Thanks again for the update!

  • [Avatar for Paul Cole]
    Paul Cole
    September 5, 2014 02:28 pm

    Res ipsa loquitur, as they say.

    What is significant is the unappreciated fact sensitivity of these decisions. The Australian Full Court bought into the isolated chemical molecule concept because that was in fact what was claimed. The US Supreme Court refused to do so, (see the minority opinion in the CAFC also) because although the claim said “isolated”, isolation of the BRCA1 full length gene at least had not been reported in the specification as filed. Justice Thomas therefore looked at the claim as pure information, not a chemical compound.

    Much confusion has been created by superficial analysis and bad lawyering. The prejudice is that the Supreme Court intends to make a broad, widely significant ruling. If you read the ruling of Justice Thomas carefully, you will see that he went to considerab le trouble to make an extremely narrow and conservative ruling. KSR was a narrow conservative ruling, so was Myriad, but both were badly misunderstood.

  • [Avatar for NWPA]
    September 5, 2014 01:59 pm

    Wow, it starts. Other countries will be happy to take our industries from us. I am not sure exactly how it will play out, but burning down our patent system is going to cause a lot of pain.

    One thing people don’t discuss enough is Germany.

  • [Avatar for EG]
    September 5, 2014 01:29 pm


    Bravo to the Federal Court of Australia! This slam of SCOTUS’ decision in Myriad reminds me of SCOTUS’ decision in Kelo v. City of New London where a bare majority of Justices turned our 5th Amendment “Takings Clause” on its head. Many State Supreme Courts (including my own in Ohio) rejected the holding in Kelo under corresponding versions of the 5th Amendment in the respective State Constitutions.

  • [Avatar for Anon]
    September 5, 2014 12:55 pm

    Recall Gene, my stated “hope” of the Alice decision – to stem the tide of anti-patent rulings, much like Chakrabarty did so earlier in history.

    I fear that while some of our regular posters may be correct in taking issue with you as to what should be happening – if Alice were to be taken on a very short leash, what is actually happening is the very worst of my fears.

    I dread saying this, but I am now hoping that things actually do get much much worse. Maybe we should all embrace (at least in the short term) the full logical consequences of what is unfolding.

    I hope things get so ridiculously worse that Congress has no choice but to stand up, take notice, and take action.

    I will note that at least one member of the judiciary member in Congress (as shown in the recent Miss Lee exchange) was livid to think that a broad scale assault against “software” may be an outcome of the Alice case. The response given by Miss Lee was pure noncommittal fluff. The response we see in reality is something quite different.

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