The federal appeals court with jurisdiction over questions of patent law has consistently held that methods of diagnosing a disease or other biological condition violate the Supreme Court’s ban on patenting “natural phenomena.” A recent decision reaffirmed this position (in the veterinary sphere), and for the first time in many years clearly articulated the test that a method of diagnosis fails: In the court’s opinion, mere diagnosis of a disease is not a “tangible and useful” result. However, due to the history of this test, it is of questionable value to patent stakeholders.
Diagnosis without Treatment Is Banned from Patenting
Readers of this blog are aware that the Supreme Court decided that a method of determining whether a patient receiving a drug is overdosed or under-dosed was banned from patenting in Mayo Collaborative Services v. Prometheus Laboratories, Inc., for the stated reason that the method was nothing more than a recognition of a “natural phenomenon” (i.e., that the artificial drug in question is effective at certain dosages and toxic at other dosages). The U.S. Court of Appeals for the Federal Circuit (CAFC) has interpreted Mayo to ban patents on methods of diagnosis, but to allow methods of medical treatment that depend on a diagnosis (i.e., personalized medicine). This trend, and the cases that define it, were blogged about in late 2018 in “Patenting Diagnostics and Biomarkers Six Years After Mayo.”
Since 2018, the majority of a triumvirate panel of the CAFC decided that a method of diagnosing previously un-diagnosable cases of myasthenia gravis by detecting a newly discovered biomarker fell under the Supreme Court’s Mayo ban (Athena Diagnostics, Inc v. Mayo Collaborative Services, LLC). The longest serving judge in the CAFC, Pauline Newman, offered a lengthy and thorough dissent. She emphasized that the patented method of diagnosis was new, used a wholly unrecognized approach, and produced a “tangible and useful result.” The “tangible and useful result” standard was taken from the earlier decision in Rapid Litigation Management Ltd., v. Cellzdirect, Inc., in which the CAFC upheld the patent-eligibility of a method of freezing cells. Because effectively preserving cells was considered a “tangible and useful result,” the court allowed the patent in that case to stand.
Diagnosis and Genotyping Not “Tangible and Useful”
The CAFC has again applied the “tangible and useful result” standard in the recent case of Genetic Veterinary Sciences v. LABOKLIN GmbH & Co. KG. In Genetic Veterinary Sciences the patent at issue claimed methods of diagnosing the canine disease known as hereditary nasal parakeratosis, a disease that causes unsightly crusting and fissures in the dog’s nose. The claims were directed to genotyping the SUV39H2 gene, which was discovered to cause the disease. Dependent claims included limitations for specific sequencing techniques, all of which had previously been known and used to sequence other genetic loci. A unanimous panel of the CAFC decided that the invention, as claimed, was not eligible for patenting because the invention was nothing more that the recognition of a natural phenomenon, notwithstanding claims to specific techniques such as PCR (or even the use of specific DNA primers). In comparing this invention to the cell cryopreservation technique in Cellz Direct, the court concluded that “Here, the Asserted Claims provide no tangible result save the observation and detection of a mutation in a dog’s DNA. While a positive and valuable contribution, these claims fall short of statutory patentable subject matter.”
A New Standard of Patent Eligibility?
The CAFC seems to be relying on a test for patent eligibility that rests on shaky ground. The “tangible and useful result” test is actually an old standard, first established by the CAFC in the State Street Bank case. Although this standard was never explicitly overturned, Associate Justice Stephen Breyer has written disparagingly of it in his concurring opinion in Bilksi v. Kappos and his dissent from the refusal of the petition for certiorari in Labcorp v. Metabolite Labs. The USPTO’s internal procedure forbids the use of this standard, as the USPTO interprets Supreme Court precedent as incompatible with it. The CAFC’s recent reliance on a standard that is apparently disfavored by the Supreme Court would seem to be setting the scene for yet another Supreme Court reversal of CAFC precedent. It could be risky for patent stakeholders to rely on this test to evaluate the patent-eligibility of inventions for two reasons. First, the CAFC is notorious for internal divisions, and a panel of different judges from those on the Veterinary Sciences panel might reject the “tangible and useful result” test. Second, this Supreme Court reverses the CAFC frequently, and it is foreseeable that the “tangible and useful result” test could be the subject of such a Supreme Court reversal. Apart from the potential demise of the test, it is anything but clear when an invention produces “tangible and useful” results based on the CAFC’s decisions. Why does a method freezing cells produce a tangible and useful result, but not a method of genotyping dogs? Until questions such as these are resolved, the “tangible and useful result” test remains of dubious value to the regulated public.