Washington Editor

WASHINGTON – A day after the Supreme Court ruled that a lower court's standard for determining the patentability of all business methods was too narrow, the high court sent back to the U.S. Court of Appeals for the Federal Circuit for further consideration a separate methods patent case involving a test used to determine proper drug dosing.

In Bilski v. Krappos, which the Supreme Court heard last November, the justices last week ruled that two businessmen's method of hedging risks in commodities was too abstract to be patentable. But the high court also said the Federal Circuit had incorrectly determined that the so-called machine-or-transformation test was the sole test for deciding the patentability of all business methods. (See BioWorld Today, Aug. 10, 2009, Nov. 11, 2009, and June 29, 2010.)

In light of its ruling in Bilski, the Supreme Court wanted the Federal Circuit to take another look at its decision in Mayo Collaborative Services v. Prometheus Laboratories Inc., in which the appeals court in September 2009 had ruled that the machine-or-transformation test had been met, meaning the invention in the case was tied to a particular machine or apparatus or it transformed a particular article into a different state or thing.

The Supreme Court in its grant-vacate-remand (GVR) order in Prometheus was not necessarily saying that the lower court got it wrong or was even trying to tell the Federal Circuit how it should rule, said Dan Bagatell, a partner and co-chair of the appellate practice group at the Phoenix offices of Perkins Coie LLP.

"It's just telling them now you have more information, now you have our decision telling you that the machine-or-transformation test is not the only test under Section 101 [of the Patent Act], and you may wish to reconsider," he told BioWorld Today.

The Federal Circuit, Bagatell said, may reissue its opinion in some modified form reaching the same result or it could reach a different conclusion.

San Diego-based Prometheus is the sole and exclusive licensee of two patents that claim methods for calibrating the proper dosage of thiopurine drugs, which are used for treating certain autoimmune diseases.

Although the drugs have been marketed for years, the patents claim methods that seek to optimize therapeutic efficacy while minimizing toxic adverse effects.

Prometheus' PRO-PredictRx test uses a three-step approach to dosing, in which the drug is administered, the level of the drug is then determined and then a decision is made about whether the next dose should be lower, higher or the same.

But the Mayo Clinic challenged the patentability of Prometheus' test, and reported that it planned to use and sell its own similar test. Prometheus sued in 2004, claiming patent infringement.

As the case has played out through the courts process, Prometheus has argued that its therapeutic methods have met the machine-or-transformation test.

The Federal Circuit agreed, stating that the firm's invention was the series of transformative steps that optimizes efficacy and reduces toxicity of a method of treatment for particular diseases using particular drugs.

Tom DiLenge, general counsel for the Biotechnology Industry Organization, noted that the Prometheus suit is "much more on point for the biotechnology industry" than Bilski. Had the Supreme Court not ruled as it did in Bilski, "the spillover effect on cases like Prometheus could have been grave," DiLenge said.

The Bilski decision, he contended, reaffirmed Section 101 of the Patent Act's "broad subject matter eligibility," which is a "real victory for biotechnology and many other industries."

DiLenge said he expected the Bilski and Prometheus rulings to have a positive impact on a case involving Myriad Genetics Inc.'s patents for the BRCA1 and BRCA2 genes, which was recently appealed to the Federal Circuit. (See BioWorld Today, Feb. 8, 2010, March 31, 2010 and June 21, 2010.)

"We are hopeful that the Federal Circuit will reverse the district court in that decision," DiLenge said. In its ruling, which essentially invalidated certain Myriad BRCA gene patents, the U.S. District Court for the Southern District of New York "just got it wrong," he insisted.

But Thomas Meyers, a partner and head of the intellectual property practice at Boston-based Brown Rudnick LLP, argued that Bilski does not change the Myriad ruling. "Those things are still not patent eligible," he said of the BRCA genes involved in the suit, known as Association for Molecular Pathology v. U.S. Patent and Trademark Office, which was brought last year by the American Civil Liberties Union and a coalition of patients, pathologists, genetic researchers and other scientists.

Meyers contended that there was nothing in the Supreme Court's Bilski opinion that would "make one think that the result of the BRCA case was incorrect."

Regarding District Court Judge Robert Sweet's ruling in the Myriad case, he added that "I won't say it was decided correctly, because that is another issue."

For now, Meyers said, "We don't have a whole lot of clear guidance, other than the fact that it appears that the machine-or-transformation test, while not exclusive, is very useful, and if you meet the machine-or-transformation test, you are probably patent eligible."

But he also pointed out that the Patent Act has many other requirements beyond Section 101 that must be met.

"Just because you pass that first test, does not necessarily mean you are going to get a patent," Meyers said. But, he said, companies that get past the machine-or-transformation test are "at least in the game."