3:40 PM
 | 
Jan 25, 2019
 |  BioCentury  |  Politics, Policy & Law

101 problems with patent eligibility

Why diagnostic innovation needs Congress to fix patent law’s Section 101

The U.S. diagnostics industry is being strangled, and other life science inventions are being hobbled by, ill-conceived and contradictory patent policies. The USPTO director has signaled he wants to help, but only Congress has the power to fix the problem.

Compounding Congress’ slow pace are conflicts between the interests of the tech and biotech industries, which differ on how wide the boundaries of patentable subject matter should be.

The parties are being brought to the table by an ad hoc group that includes a former United States Patent and Trademark Office director and an influential retired federal judge, who are trying to push Congress to come up with a solution that helps life science companies without harming the tech industry.

The source of the confusion is Section 101 of the Patent Act, which creates a minimum threshold for patentable inventions. The problems were created by the Supreme Court’s interpretation of Section 101 and attempts to draw lines between discovery and invention.

"The law is in chaos through a series of Supreme Court decisions that cannot be read except as conflicting each other."

David Kappos, Cravath, Swaine & Moore, formerly USPTO

Since the 2012 Mayo Collaborative Sciences et al v. Prometheus Laboratories Inc. ruling raised questions about the patentability of diagnostic tests, it has become exceptionally difficult to get diagnostics claims issued. Those that do issue are rarely enforceable in court.

The fallout has affected investments in the space. “As a whole, the diagnostics industry has been practically destroyed by Section 101 chaos,” said Paul Michel, former chief judge of the U.S. Court of Appeals for the Federal Circuit (CAFC).

Michel argues the inability to patent diagnostic inventions in the U.S. is drying up funding, causing companies to shelve useful and effective products, and driving capital to regions with a wider gateway of patent eligibility.

With updated guidance on Section 101 issued on Jan. 7, USPTO is taking the steps within its jurisdiction to clear up confusion over patent eligibility.

Still, solving the bigger problem is out of the USPTO’s hands. The ball is now in Congress’s court, as only it and the Supreme Court have the power to widen the net for patentable inventions.

Diagnosing the problem

Section 101 was written into the law in 1952, but problems for biopharma and tech companies started in the last decade when a series of Supreme Court decisions narrowed the scope of patentable inventions to exclude three categories: laws of nature, natural phenomena and abstract ideas.

Two Supreme Court rulings on Section 101 directly impact biopharma companies by affecting protection of naturally occurring substances and diagnostic tests.

"I think it's now easier to get a bio patent in China than in the U.S."

David Kappos, Cravath, Swaine & Moore, formerly USPTO

The 2012 Mayo ruling determined that a diagnostic test qualified as a law of nature and was patent ineligible under Section 101.

The 2013 Association for Molecular Pathology v. Myriad Genomics decision determined that substances...

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