Evolving Case Law Necessitates New Due Diligence Considerations When Evaluating Life Science Startups
Laura R. Gordon, Ph.D. and Ronald C. Kern, Jr., Ph.D. are associates in the Philadelphia office of BakerHostetler. Their practices focus on patent prosecution and client counseling in the life science, biotechnology and pharmaceutical arenas.
Investors beware: Although patent properties remain a key safeguard against infringing competition and a valuable asset for all life science startups, recent court decisions have made it more challenging than ever to secure patent protection for certain advances in diagnostics and personalized medicine.
In a series of decisions issued in 2012, 2013 and 2014, the Supreme Court drastically narrowed the scope of subject matter that can be patented in the United States (patent-eligible subject matter). The life science industry was hit particularly hard by these and subsequent decisions from the district courts and the U.S. Court of Appeals for the Federal Circuit (Federal Circuit), which have continued to whittle away at the scope of patent-eligible subject matter in such areas as diagnostics and personalized medicine. Recently, however, the Federal Circuit issued a number of decisions that strengthen its own precedent regarding the patent-eligibility of method of treatment claims, and both the Supreme Court and Congress have expressed interest in continuing to shape patent-eligibility considerations.
Diagnostics and personalized medicine
In the landmark decision Mayo Collaborative Servs. v. Prometheus Labs., Inc., the Supreme Court held that diagnostic claims – specifically claims directed to “relationships between concentrations of certain metabolites in the blood and the likelihood that a thiopurine drug dosage will prove ineffective or cause harm” – are not patent eligible. The Federal Circuit has continued this trend in recent decisions, for example finding that claims to a method for detecting a paternally inherited nucleic acid of fetal origin in plasma from the pregnant mother are directed to a natural law and are not patent eligible.
Most recently, the Federal Circuit ruled that the May 2016 Subject Matter Eligibility Guidance issued by the United States Patent and Trademark Office (USPTO Guidance) – which is used by many applicants as a model for claim drafting – is not binding on the courts and may even present ineligible model claims. Specifically, the Federal Circuit rejected efforts by patent owner/appellant Cleveland Clinic to avoid a finding of patent-ineligibility by restyling diagnostic method claims as “techniques” for detecting a correlation between protein levels and a disease state. The court’s unwillingness to accept the patent-eligibility of diagnostic method claims – even those claims that are rephrased as a process of detection rather than the product or natural correlation per se – directly contradicts the position taken by the USPTO Guidance. Cleveland Clinic, although designated as a non-precedential opinion, deepens the growing divide between administrative and judicial interpretations of patent-eligibility and is sure to be an unwelcome development for patent applicants who have been modeling diagnostic method claims on the USPTO Guidance since 2016.
The patents at issue, U.S. Patent No. 9,575,065 and U.S. Patent No. 9,581,597, describe diagnostic tests for determining the risk of developing cardiovascular disease (CVD) by measuring the level of a naturally occurring hemeprotein, myeloperoxidase (MPO), in a patient’s blood. The patents describe the breakthrough finding that “blood MPO levels strongly correlate with risk of coronary artery disease but not with traditional risk factors for coronary artery disease.” But the specification and prosecution history “plainly concede” that the process steps used to measure MPO levels in the blood were “well-known in the art.”
The court determined that the claims of both patents are not patent-eligible because they are directed to “the natural law that blood MPO levels correlate with atherosclerotic [cardiovascular disease].” In so finding, the court was unpersuaded by Cleveland Clinic’s argument that the claims are directed to patent-eligible techniques for detecting elevated levels of MPO in the blood. According to the court, the claims merely “recite applying known methods to detect MPO levels in plasma, comparing them to standard MPO levels, and reaching a conclusion: that the patient’s blood MPO levels are elevated in comparison to a control group.” The “rephrasing of the claims does not make them less directed to a natural law.”
The court was equally unpersuaded by Cleveland Clinic’s argument that the claims do not recite a natural law because the phenomenon could only be observed by using certain laboratory techniques. As articulated by the court, “Inadequate measures of detection do not render a natural law any less natural.”
Furthermore, the court found that the claims “contain no additional inventive concept.” Even though it had never been shown that MPO was present at elevated levels in blood samples from patients with atherosclerotic CVD, the court rejected the premise that “using a known technique in a standard way to observe a natural law can confer an inventive concept.”
Cleveland Clinic argued that the district court did not give appropriate deference to the USPTO Guidance, especially patent-eligible Example 29-Claim 1, which recites:
1. A method of detecting JUL-1 in a patient, said method comprising:
a. obtaining a plasma sample from a human patient; and
b. detecting whether JUL-1 is present in the plasma sample by contacting the plasma sample with an anti-JUL-1 antibody and detecting binding between JUL-1 and the antibody.
The court stated that “[w]hile we greatly respect the PTO’s expertise on all matters relating to patentability, including patent-eligibility, we are not bound by its guidance.” Indeed, the court found Example 29-Claim 1 to be “strikingly similar” to a claim invalidated for being directed to unpatentable subject matter in Ariosa Diagnostics, Inc. v. Sequenom, Inc. The court offered the explanation that, where the techniques used to detect the protein (JUL-1) were conventionally applied, “[t]he only remaining non-conventional element of each claim is the discovery that the protein is present in the bodily sample, and the discovery of a natural law cannot by itself provide the requisite inventive concept.”
Methods of treatment
Recently, the Federal Circuit has viewed “method of treatment” claims more favorably than diagnostic and personalized medicine claims. In Vanda Pharma. Inc. v. West-Ward Pharm. Int’l Ltd., which was decided in 2018, the Federal Circuit ruled that claims directed to methods of treating patients with schizophrenia were patent-eligible even though the claims required that the patient is genotyped to determine if they have a “poor metabolizer genotype” and then treating the patient based on those results. In that decision, the court focused on the treatment aspect of the claims (i.e., a method of using a specific drug to treat schizophrenia), which was said to make the claims patent-eligible. Since that decision, the Federal Circuit has appeared to push for the patent-eligibility of method of treatment claims, focusing on whether the claims as a whole are directed to methods of treating a subject and/or whether the claims recite some type of dosing regimen. The Supreme Court, however, has expressed interest in the Vanda decision, recently requesting the views of the U.S. solicitor general on this exact issue. Time will tell the fate of method of treatment claims.
A question to consider with method of treatment claims is who will ultimately infringe these claims. Because companies are not treating patients, infringement of method of treatment claims by a competitor will likely depend on whether that competitor induced someone to perform the treatment. Knowledge of a startup company’s business model as well as that of its competitors will factor into this analysis.
Life science companies that are looking to secure patent protection must work with knowledgeable counsel to strategically develop patent filings that have the best chance of surviving prosecution at the Patent Office and any challenges in court. At the same time, it is more important now than ever for investors and other early-stage partners to critically evaluate the technology of life science companies, including proposed and pending patent filings, as inventions that were said to be patentable yesterday could very well be non-patentable today.
 566 U.S. 66 (2012).
 Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371 (Fed. Cir. 2015).
 “Cleveland Clinic” collectively refers to Cleveland Clinic Foundation and Cleveland HeartLab Inc.
 Cleveland Clinic Found. v. True Health Diagnostics LLC, No. 2018-1218, 2019 WL 1452697, at *4 (Fed. Cir. Apr. 1, 2019) (“Cleveland Clinic”).
 Id. at *1.
 Id. at *2.
 Id. at *5.
 Id. at *4.
 Id. at *5.
 Id. at *6.
 788 F.3d 1371 (Fed. Cir. 2015).
 887 F.3d 1117 (Fed. Cir. 2018).