WASHINGTON, March 26 (Reuters) - The U.S. Supreme Court on
Monday set aside a ruling that said Myriad Genetics Inc could
patent two genes linked to breast and ovarian cancers, and
ordered further review by a lower court in light of a
conflicting ruling in a similar case.
The Myriad case has been closely watched by the biotechnology industry, with some insiders suggesting that a
ruling against gene patenting could have a devastating effect on
That includes the fledgling field of personalized medicine,
which depends on genetic tests, such as those developed by
Myriad, to match patients with specific therapies.
The justices delayed any action on the ruling by the U.S.
Court of Appeals for the Federal Circuit that Myriad has the
right to patent two human genes, known as BRCA1 and BRCA2, that
account for most inherited forms of breast and ovarian cancers.
The Supreme Court ruled last week in a separate case
involving medical diagnostics that companies cannot patent
observations about a natural phenomenon. On Monday, it asked the
lower court to revisit the Myriad case to view how it may or may
not relate to that decision.
The move is expected to delay a verdict in the Myriad case
by as much as several years. In the case of the individual
company, that may give it enough time to benefit from the use of
its contested patents. Shares in Myriad rose over 3 percent.
"Our intellectual property consultant could potentially see
a scenario where the case doesn't move its way back to the
Supreme Court for another 2 to 3 plus years, keeping the
BRACAnalysis franchise safe from competition," said Junaid
Husain, a research analyst for Dougherty & Co.
Women who test positive using Myriad's gene test, called
BRACAnalysis, have an 82 percent higher risk of developing
breast cancer and a 44 percent higher risk of ovarian cancer in
their lifetimes. Such tests could help determine a future course
The appeals court by a 2-1 vote had ruled the genes isolated
by the company could be patented because Myriad is testing for
distinctive chemical forms of the genes, and not as they appear
naturally in the body. The dissenting judge said the genes could
not be patented just because they were isolated from the body.
The patents granted to Myriad give the company the exclusive
right to perform the genetic tests. The appeals court in its
ruling in July also found that Myriad's method for screening
potential therapies can be patented.
The appeals court had overturned a ruling by a federal judge
in New York that the genes could not be patented.
HOW BIG A HURDLE?
Michael Yee, biotech analyst for RBC Capital Markets, said
the Supreme Court not taking up the case on Monday was positive
for the biotechnology industry.
Yee said he believes the courts will ultimately uphold
Myriad's patents, but does not agree that a ruling against
Myriad would upend the biotech industry, as some have suggested.
"Biotechs have patents and intellectual property for
proteins, antibodies, chemical entities and other composition of
matter patents that support development of drugs," Yee said.
While biotechs will likely continue to develop lucrative
medicines regardless of the case's ultimate outcome, a decision
against gene patenting could hurt small diagnostics companies
that depend on exclusive rights to such tests for revenue and
could slow advances in personalized medicine.
"We will likely begin to see more copycat diagnostic tests
rather than innovative tests over the next few years," according
to a report by GlobalData, which compiles and analyzes industry
The initial lawsuit filed against Myriad in 2009 claimed the
patents violated patent law, restricting scientific research and
patients' access to medical care. Some groups have protested
that patenting human DNA is immoral and unethical and impedes
The appeal to the Supreme Court was backed by a number of
organizations representing healthcare professionals, including
the American Medical Association, and other groups.
The appeal argued that the question of whether genes and the
information they convey can be patented is of "paramount
importance to the future of patent law, the advancement of
medical science and patients' health."
Gregory Castanias, the attorney representing Myriad, told
the Supreme Court that patents involving isolated DNA molecules
have been issued for nearly 30 years, resulting in significant
investment by biotechnology companies.
Castanias said the challenged patents at issue in the case
were filed more than 16 years ago. He said the appeals court's
decision was correct and the "questions presented are unique to
this case, factbound and unlikely to recur."
The Supreme Court case is the Association for Molecular
pathology v. Myriad Genetics, No. 11-725.
(Reporting By James Vicini; additional reporting by Bill
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