Tuesday, March 27, 2012


In two cases over the last week, the US Supreme Court substantially clarified the IPR related to genes. (Good summaries here (NYT). The outcomes in both cases were decidedly anti-gene patent holders, and the biotech world is FREAKING OUT! 

The fear is that the court has greatly reduced the incentive to develop gene-based medical advances, since neither the gene-focused test or the gene-related intelligence (diagnosis or prognosis) can now be patented.

I'm 100% in disagreement with this point of view - I think the court rulings are spot on, an overdue realization of reason, and great news.

The practical impact of these decisions is that:

1) the developer(s) of therapeutics will have to take on more of the burden of gene-focused testing/diagnosis/prognosis. It will be in the best interest of any pharma to promote gene tests to include or exclude particular patients.

2) developing and rolling out personalized medicine just became a LOT easier. Imagine if a tech platform could generate heaps of patient-specific, gene-specific actionable data. (This could be a sequencing platform, a gene expression platform, or even a multiplexed PCR approach.) No longer will the platform company (or its' customers) have to cross-license heaps of gene-specific IP holders just to get their assay to market.

3) The expected value of passively held gene-IP has dropped to zero. (Sorry, patent trolls.) If you were holding Incyte or HGSI stock just for the residual value of their gene IP generated a decade ago, you were just zeroed out.

Ultimately, there are two takeaways:

1) in business, it doesn't really matter what formal granted IP you have, it matters what you do with what you know, and how you use it to meet a customer need. (I've said often (but not on this blog) that IPR is massively overrated in the biotech world.)

2)  the court established that genetic medical knowledge is no different than say temperature sensitive medical knowledge. (In the Prometheus decision, Prometheus wanted to patent the knowledge that presence or absence of a metabolyte would guide more or less application of a drug. Likewise, a patient with a temperature of say 96 degrees requires a different medical response than one with a temp of 102 degrees.) Somehow, medicine has advanced this far without being able to patent temperature diagnoses.

(Incidentally, I'm not one to regularly contribute to the ACLU, but being in agreement with their stance on gene patenting, I have contributed in a small way since 2008.)

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