The Supreme Court ruled unanimously yesterday in Association of Molecular Pathology v. Myriad Genetics that a gene, such as BRCA1 or BRCA2, does not qualify for a patent. The fact that Myriad isolated the DNA is not enough to distinguish it from its in situ counterpart as the information it contains is the same. However, cDNA, a version of the gene that has been stripped of non-coding sequences is subject to patent.
With this ruling the price of most of Myriad’s tests will fall as competition enters the market (the BRACAnalysis tests are actually a number of different tests, as I read the technical specifications, only some of these depend on cDNA. The markets appeared to have been initially confused about this.). Even more importantly, the Myriad patents were broad and they prevented researchers from freely studying the BRCA1 and BRCA2 genes, from improving the tests or from developing additional applications. The giants demanded payment (video) from those who would stand on their shoulders. I think the restrictions retarded progress–as have similar restrictions–to an extent that made the patents difficult to justify.
Although I am broadly in agreement with the ruling, it’s also clear that the limited flexibility of patent law–you get a 20-year patent or nothing–and the fact that patent law is not based on patent theory (pdf) greatly hampers the ability to tailor patent law optimally. The ruling, for example, says that a firm can’t patent a gene that it discovers but it can patent the cDNA that it develops. It’s the discovery, however, that’s expensive. The development of cDNA is today a trivial step. Thus, you can patent the trivial step but not the giant leap.
You might think that the law draws a bright line between discoveries which cannot be patented and inventions which can but that’s not correct. Discoveries can be patented and the ruling goes out of its way to push back against the view that they can’t. The ruling correctly notes that a “considerable danger” is that patents on basic ideas and tools would “inhibit future innovation”. Yet the law makes no mention of these considerations and the court provides no guidance on implementation.
Coherent or not, the recent patent cases do indicate that the SC is no longer acceding to the United States Court of Appeals for the Federal Circuit–they are reestablishing control and pushing back in the right direction on the Tabarrok curve.