At Managing IP's US Patent Forum in Washington, DC last week, several panelists were outspoken in their criticism, saying they were “horrified” by the new guidance for examiners.
“I think the guidelines that were promulgated by the Patent Office are horrifying to the pharmaceutical and biotech industry,” said speaker Sherry Knowles, principal at Knowles Intellectual Property Strategies.
“That is probably the nicest thing I could say about them. According to the utility guidelines that came out in March this year, not only is no natural product not patentable in the US, arguably derivatives of natural products may also not be patentable. That is a clear change in the law.”
And Joseph Contrera, patent counsel at Johns Hopkins Technology Transfer, said the USPTO is ignoring the part of the statute that referred to discoveries. “I think horrified is a minor adjective I would use when I read those guidelines," he said. "It occurred to me that now I know how the USPTO is getting rid of its backlog because that is pretty much everything we do at Hopkins. I don’t know how the Patent Office got from we are not going to patent a particular gene to we are not going to patent any natural product."
Managing IP interviewed Andrew Hirshfeld (right), deputy commissioner for patent examination policy at the USPTO, to get a detailed response.
He noted that Myriad “completely changed examination practice” and revealed that the USPTO is encouraging public input and is planning a roundtable to receive feedback on the issue.
Hirshfeld said the guidelines address the Myriad decision in the framework of other Supreme Court rulings on the patent-eligibility of natural things, including Chakrabarty, Mayo, and Funk Brothers.
Hirshfeld explained the USPTO has to consider Myriad in the context of the other cases because of Myriad’s reliance on Chakrabarty to determine the eligibility of natural products and the judges’ reference to Mayo to support Myriad’s argument that naturally occurring things are not patent eligible.
He noted that examiners may have to assess claims involving more than one type of judicial exception and therefore needed guidance on how to examine such claims.
"One reason for treating the cases together in the guidance is the reliance in Myriad on Chakrabarty as 'central' to the eligibility inquiry with respect to natural products, and its citation to Mayo in support of its statement that there is a 'rule against patents on naturally occurring things'," said Hirshfeld. "Another reason is that many claims presented by applicants concern two or more different types of judicial exceptions, for example both natural products and laws of nature, and so our examiners needed guidance on how to examine these types of claims.
"In particular, the guidance brings together the outcomes of both Myriad and Mayo in its expression of the 'significantly different' standard for eligibility."
Regarding Contrera’s statement that the USPTO is ignoring the part of the statute that referred to discoveries, Hirshfeld said the agency has no choice but to adopt the Supreme Court’s interpretation of the law.
“Our interpretation of 101 is based on the Supreme Court, which has refused to consider all ‘discoveries’ eligible,” he said. “So we have to go with how the Supreme Court has interpreted the statute.”
Here are the full answers from Hirshfeld in response to Managing IP’s questions (in bold):
Are the panelists correct in their interpretation of the guidelines?
I’d like to start by noting that we welcome public feedback on our new guidance. Myriad completely changed examination practice, and it was critical that we issue that new guidance as soon as possible. As in the past, however, we are encouraging public input, and that input could lead to updated guidance in the future. For example, we have just started planning a public roundtable designed to give the public an opportunity to share their thoughts and engage in discussion. As soon as we have the logistics finalised we’ll formally announce the event and encourage public participation.
Based on the article, there are inaccuracies in the panelists’ interpretation. For example, the article states, “She said the guidelines include a number of questions to find out if something is patentable. The first is: is it a natural product and whether it includes chemicals derived from natural sources such as antibiotics and proteins.” This is inaccurate.
Our guidelines set forth the following three questions: (i) Is the claimed invention directed to one of the four statutory patent-eligible subject matter categories: process, machine, manufacture, or composition of matter?; (ii) Does the claim recite or involve one or more judicial exceptions?; and (iii) Does the claim as a whole recite something significantly different than the judicial exception(s)?
Is the USPTO ignoring the part of the Section 101 statute that states, “Whoever invents or discovers…”?
Our interpretation of 101 is based on the Supreme Court, which has refused to consider all “discoveries” eligible. So we have to go with how the Supreme Court has interpreted the statute. A few informative passages follow.
Myriad @ 2117:
Groundbreaking, innovative, or even brilliant discovery does not by itself satisfy the §101 inquiry. In Funk Brothers Seed Co v Kalo Inoculant Co, 333 US 127, 68 S. Ct. 440, 92 L. Ed. 588, 1948 Dec. Comm'r Pat. 671 (1948), this Court considered a composition patent that claimed a mixture of naturally occurring strains of bacteria that helped leguminous plants take nitrogen from the air and fix it in the soil. Id., at 128-129, 68 S. Ct. 440, 92 L. Ed. 588. The ability of the bacteria to fix nitrogen was well known, and farmers commonly "inoculated" their crops with them to improve soil nitrogen levels. But farmers could not use the same inoculant for all crops, both because plants use different bacteria and because certain bacteria inhibit each other. Id., at 129-130, 68 S. Ct. 440, 92 L. Ed. 588. Upon learning that several nitrogen-fixing bacteria did not inhibit each other, however, the patent applicant combined them into a single inoculant and obtained a patent. Id., at 130, 68 S. Ct. 440, 92 L. Ed. 588. The Court held that the composition was not patent eligible because the patent holder did not alter the bacteria in any way. Id., at 132, 68 S. Ct. 440, 92 L. Ed. 588 ("There is no way in which we could call [the bacteria mixture a product of invention] unless we borrowed invention from the discovery of the natural principle itself"). His patent claim thus fell squarely within the law of nature exception. So do Myriad's. Myriad found the location of the BRCA1 and BRCA2 genes, but that discovery, by itself, does not render the BRCA genes "new . . . composition[s] of matter," §101, that are patent eligible.
Mayo @ 1293:
Thus, the Court has written that "a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter. Likewise, Einstein could not patent his celebrated law that E=mc2; nor could Newton have patented the law of gravity. Such discoveries are 'manifestations of . . . nature, free to all men and reserved exclusively to none.'" Chakrabarty, supra, at 309, 100 S. Ct. 2204, 65 L. Ed. 2d 144 (quoting Funk Brothers Seed Co v Kalo Inoculant Co., 333 U.S. 127, 130, 68 S. Ct. 440, 92 L. Ed. 588, 1948 Dec. Comm'r Pat. 671 (1948)).
"Phenomena of nature, though just discovered, mental processes, and abstract intellectual concepts are not patentable, as they are the basic tools of scientific and technological work." Gottschalk v. Benson, 409 U.S. 63, 67, 93 S. Ct. 253, 34 L. Ed. 2d 273 (1972). And monopolization of those tools through the grant of a patent might tend to impede innovation more than it would tend to promote it.
Mayo @ 1301:
These statements reflect the fact that, even though rewarding [***33] with patents those who discover new laws of nature and the like might well encourage their discovery, those laws and principles, considered generally, are "the basic tools of scientific and technological work." Benson, supra, at 67, 93 S. Ct. 253, 34 L. Ed. 2d 273. And so there is a danger that the grant of patents that tie up their use will inhibit future innovation premised upon them, a danger that becomes acute when a patented process amounts to no more than an instruction to "apply the natural law," or otherwise forecloses more future invention than the underlying discovery could reasonably justify.
Chakrabarty @ 309-310:
This is not to suggest that § 101 has no limits or that it embraces every discovery. The laws of nature, physical phenomena, and abstract ideas have been held not patentable. See Parker v Flook, 437 U.S. 584 (1978); Gottschalk v Benson, 409 U.S. 63, 67 (1972); Funk Brothers Seed Co v Kalo Inoculant Co, 333 U.S. 127, 130 (1948); O'Reilly v Morse, 15 How. 62, 112-121 (1854);Le Roy v Tatham, 14 How. 156, 175 (1853).Thus, a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter. Likewise, Einstein could not patent his celebrated law that E=mc<2>; nor could Newton have patented the law of gravity. Such discoveries are "manifestations of . . . nature, free to all men and reserved exclusively to none." Funk, supra, at 130.
Judged in this light, respondent's micro-organism plainly qualifies as patentable subject matter. His claim is not to a hitherto unknown natural phenomenon, but to a nonnaturally occurring manufacture or composition of matter – a product of human ingenuity "having a distinctive name, character [and] [*310] use." Hartranft v Wiegmann, 121 U.S. 609, 615 (1887).The point is underscored dramatically by comparison of the invention here with that in Funk. There, the patentee had discovered that there existed in nature certain species of root-nodule bacteria which did not exert a mutually inhibitive effect on each other. He used that discovery to produce a mixed culture capable of inoculating the seeds of leguminous plants. Concluding that the patentee had discovered "only some of the handiwork of nature," the Court ruled the product nonpatentable:
"Each of the species of root-nodule bacteria contained in the package infects the same group of leguminous plants which it always infected. No species acquires a different use. The combination of species produces no new bacteria, no change in the six species of bacteria, and no enlargement of the range of their utility. Each species has the same effect it always had. The bacteria perform in their natural way. Their use in combination does not improve in any way their natural functioning. They serve the ends nature originally provided and act quite independently of any effort of the patentee." 333 US, at 131.
Here, by contrast, the patentee has produced a new bacterium with markedly different characteristics from any found in nature and one having the potential for significant utility. His discovery is not nature's handiwork, but his own; accordingly it is patentable subject matter under § 101.
Can you offer some insight into the USPTO’s thinking behind the guidelines?
The guidance addresses Myriad in the framework of other Supreme Court decisions on the eligibility of natural things, including Chakrabarty, Mayo, and Funk Brothers. One reason for treating the cases together in the guidance is the reliance in Myriad on Chakrabarty as “central” to the eligibility inquiry with respect to natural products, and its citation to Mayo in support of its statement that there is a “rule against patents on naturally occurring things.” Another reason is that many claims presented by applicants concern two or more different types of judicial exceptions, for example both natural products and laws of nature, and so our examiners needed guidance on how to examine these types of claims.
In particular, the guidance brings together the outcomes of both Myriad and Mayo in its expression of the “significantly different” standard for eligibility. The “significantly different” standard addresses the Supreme Court’s two pathways to eligibility for claims reciting certain judicial exceptions such as natural products: (1) the 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), as set forth in Chakrabarty and Myriad; and (2) the claim includes elements or steps in addition to the judicial exception that practically apply the judicial exception in a significant way, e.g., by adding significantly more to the judicial exception, as set forth in Mayo.
Similarly, the factors that weigh toward or against eligibility are all derived from Supreme Court decisions on patent eligibility, including Funk Brothers, Flook, Diehr, Chakrabarty, Mayo and Myriad. All of the factors were articulated by the Court in one or more of these cases, in connection with its eligibility determinations of particular claims reciting or involving laws of nature, natural phenomena, or natural products.
As for the examples, they were drafted to explain the concepts of “significantly more” and “markedly different” in a variety of technologies and in connection with different claim types (e.g., product and process claims). Some of the examples are taken directly from the case law mentioned above, and others were drafted to further clarify the idea of “significantly more” and “markedly different”.