Changes in USPTO practice will have significant impact on matter considered patent eligible

The patentability of genes and methods of medical treatment in Australia has garnered much attention of late. As detailed in recent posts, Australian Courts have confirmed the patentability of isolated gene sequences per se and methods of medical treatment.

In contrast, recent US Supreme Court decisions have placed significant roadblocks against patenting isolated gene sequences [PDF, 150KB] per se and diagnostic methods [PDF, 152KB]. However, of concern to the biotechnology and pharmaceutical industries has been the extent to which these decisions would create precedents for determining the patentability of other naturally occurring products and methods of treatment.

Guidance Memoranda

On 13 June 2013, the same day that the US Supreme Court issued its decision concerning the patentability (or lack thereof) of isolated gene sequences per se, the USPTO issued a brief Memorandum [PDF, 53KB] providing guidance to US patent examiners. The memorandum stated that, from that point forward:

  • naturally occurring nucleic acids were not to be considered patent eligible merely because they have been isolated,
  • examiners should reject product claims drawn solely to naturally occurring nucleic acids or fragments thereof, whether isolated or not, as being ineligible subject matter, and
  • claims clearly limited to non-naturally-occurring nucleic acids, such as a cDNA or a nucleic acid in which the order of the naturally occurring nucleotides has been altered (eg. a man-made variant sequence), remained eligible.

The USPTO has now issued a new Guidance Memorandum [PDF, 198KB] and an associated ‘Quick Reference Sheet’ [PDF, 87KB] for US patent examiners which contain procedures for determining whether claims, including those directed to isolated genes and diagnostic methods, are patentable.

As can be seen from the title, ‘Guidance For Determining Subject Matter Eligibility Of Claims Reciting Or Involving Laws of Nature, Natural Phenomena, & Natural Products (Guidance)’, the concerns held by the biotechnology and pharmaceutical industries have perhaps been realised. That is, the USPTO, in view of the above Supreme Court decisions, is applying this decision to broadly determine the patentability of natural phenomena (encompassing diagnostic methods and methods of treatment), and natural products whether isolated or not.

As stated in the new memorandum (emphasis added):“In summary, all claims (i.e., machine, composition, manufacture and process claims) reciting or involving laws of nature/natural principles, natural phenomena, and/or natural products should be examined using the Guidance….The examination procedure set forth in the Guidance is effective today and supersedes the June 13, 2013 memorandum to the corps…”

Contents of the new Memorandum

In short, the memorandum is divided into four sections:

  1. Overall Process for Subject Matter Eligibility Is the claim directed to one of the four statutory categories of patent-eligible subject matter (ie. a process, machine, manufacture, or composition of matter)?
    • Does the claim recite or involve a judicial exception(s) to patent-eligible subject matter (ie. abstract ideas, laws of nature/natural principles, natural phenomena, natural products)?
    • Does the claim as a whole recite something “significantly different” than the judicial exception(s)?
  2. How To Analyze “Significantly Different” – this section of the memorandum analyses the meaning of the phrase “significantly different” in a way that requires examiners to consider multiple factors for and against patentability, and whether the totality of the relevant factors supports or denies patentability. A non-exhaustive list of six factors weighing toward eligibility and six factors weighing against eligibility is provided in assistance.  As examples, a significant difference can be shown where:
    • a claim includes elements or steps in addition to the judicial exception that practically apply the judicial exception in a significant way,
    • a claim includes features or steps that demonstrate that the claimed subject matter is markedly different from what exists in nature (and thus not a judicial exception).
    • So, claims directed to merely isolated natural products, are unlikely to be considered patentable. This may have a significant impact, potentially going beyond pharmacological and biotechnological patents given that ‘natural products’ can include the following:
    • chemicals derived from natural sources (e.g., antibiotics, fats, oils, petroleum derivatives, resins, toxins, etc.),
    • foods (e.g., fruits, grains, meats and vegetables),
    • metals and metallic compounds that exist in nature,
    • minerals; natural materials (e.g., rocks, sands, soils),
    • nucleic acids; organisms (e.g., bacteria, plants and multicellular animals),
    • proteins and peptides,
    • and other substances found in or derived from nature.

    Diagnostic or treatment claims which recite steps that are routine, or at a high level of generality, are also unlikely to be considered patentable.

  3. Examples – The examples include claims directed to ‘natural products’, such as purified compounds, bacteria and DNA, compositions and methods of manufacture and treatment.- Eight examples of how to apply the new procedure to different types of claims are provided. Each example includes background information, an analysis of each claim, and a conclusion as to whether the claim is considered patentable.
  4. Form Paragraph – The last section contains a revised form paragraph to be used by patent examiners when rejecting claims that recite or involve laws of nature/natural principles, natural phenomena and/or natural products in accordance with this new procedure.

The Upside (?)

Thinking positively, the new memorandum provides useful assistance for Australian businesses seeking to protect biological and pharmaceutical inventions in the US. That is, the memorandum provides some clarity as to how patent claims may be (re)drafted to meet patentability requirements under US law. The downside is that these changes will undoubtedly have significant impact on the scope of patent protection in the US, particularly for the pharmaceutical and biotechnology industries.

It will be interesting to see if these developments in the US have any influence in Australia, and how international agreements including TRIPS impact on the USPTO’s implementation of these guidelines. It will also be interesting to see whether there is any flow on effect on the Australian Full Federal Court which is still to hand down its decision in the appeal by Yvonne D’arcy to the patentability of isolated BRCA gene sequences.