Supreme Court Decision on Scope of Patent Protection - Sullivan ...

<strong>Supreme</strong> <strong>Court</strong> <strong>Decision</strong> on Scope of
Patent Protection
March 22, 2012
<strong>Supreme</strong> <strong>Court</strong> Holds Pharmaceutical Treatment Method Without
“Inventive” Insight Unpatentable as a Law of Nature
SUMMARY
In a decision that is likely to have significant implications across the healthcare spectrum, including
biotech, diagnostics and medical devices, on March 20, 2012, the U.S. <strong>Supreme</strong> <strong>Court</strong> held that two
patents claiming methods for optimizing the therapeutic efficacy of drugs by monitoring metabolized
byproducts in a patient’s bloodstream are ineligible for patent protection under 35 U.S.C. § 101 because
they seek to claim fundamental laws of nature. Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566
U.S. ___ (2012).
In a unanimous decision, the <strong>Court</strong> continued the trend from its decision in Bilski v. Kappos, 130 S. Ct.
3218 (2010), spurning the “machine-or-transformation test,” which was the pre-Bilski standard for
determining patentability under § 101 and which the Federal Circuit had applied in Mayo both before and
after the Bilski decision. Instead, the <strong>Supreme</strong> <strong>Court</strong> instructed that “to transform an unpatentable law of
nature into a patent-eligible application of such a law, one must do more than simply state the law of
nature while adding the words ‘apply it.’” The <strong>Court</strong> held that a patentable process incorporating a natural
law must also claim “an ‘inventive concept,’ sufficient to ensure that the patent in practice amounts to
significantly more than a patent upon the natural law itself.” Although the <strong>Court</strong> did not clearly articulate
any new test in addition to the machine-or-transformation test, which it still declared “useful,” it concluded
that the patents at issue overreached by claiming fundamental laws of nature and virtually any application
of those laws, and that whatever the patents claimed beyond those fundamental laws was not sufficiently
inventive to qualify them as eligible subject matter under § 101.
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BACKGROUND
Under U.S. patent law, four independent categories of inventions or discoveries are eligible for patent
protection: “process[es],” “machine[s],” “manufacture[s],” and “composition[s] of matter.” 35 U.S.C.
§ 101. The scope of these expansive terms is limited by the long-standing rule excluding from
patentability “laws of nature, physical phenomena, and abstract ideas.” Diamond v. Chakrabarty, 447
U.S. 303 (1980). “Phenomena of nature, though just discovered . . . are not patentable, as they are the
basic tools of scientific and technological work.” Gottschalk v. Benson, 409 U.S. 63, 67 (1972).
In Mayo, the patents at issue claimed methods for treating autoimmune diseases with a class of drugs
that had been used in that role for many years. Because patients metabolize these drugs at different
rates, the same dosage can be too potent in one patient, risking harmful side effects, and too weak in
another patient, rendering it ineffective. The patents at issue claimed steps of (1) “administering” the
drugs, and (2) “determining” the levels of drug-related metabolic byproducts in the patient’s body,
(3) “wherein,” according to a physiological correlation that exists naturally and was disclosed in the
patent, certain levels indicate a need to increase or decrease the dosage for subsequent administration.
Prometheus, the sole licensee of the patents, sells a diagnostic test that incorporates the patents. The
Mayo Clinic purchased Prometheus’s test for a period of time, but then began using its own test that
employed similar treatment guidelines based upon the same naturally existing correlation. Prometheus
then sued the Mayo Clinic for patent infringement. The district court granted summary judgment to the
Mayo Clinic based on § 101. The Federal Circuit reversed, twice, holding that the patent was valid under
§ 101. It found that the claims passed the machine-or-transformation test because the administration and
metabolism of the drug “transformed” the body of the patient to whom it was administered, and the
chemical testing required to determine metabolite levels in blood samples “transformed” those samples.
THE SUPREME COURT’S DECISION
The <strong>Supreme</strong> <strong>Court</strong> first concluded that the patents in fact claimed laws of nature. The <strong>Court</strong> explained
that, “[w]hile it takes a human action . . . to trigger a manifestation of this relation in a particular person,
the relation itself [between drug metabolites and clinical efficacy] exists in principle apart from any human
action.”
The <strong>Court</strong> then articulated the broad exclusionary principle that “[i]f a law of nature is not patentable, then
neither is a process reciting a law of nature.” Nevertheless, the <strong>Court</strong> recognized tension between this
principle and the purposes of the Patent Act, in that “too broad an interpretation of this exclusionary
principle” would preclude patenting anything, because “all inventions at some level embody, use, reflect,
rest upon, or apply laws of nature.”
Addressing this, the <strong>Court</strong> looked to its decisions in Diamond v. Diehr, 450 U.S. 175 (1981), and Parker v.
Flook, 437 U.S. 584 (1978), both of which concerned patenting laws of nature. The <strong>Court</strong> noted that
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<strong>Supreme</strong> <strong>Court</strong> <strong>Decision</strong> on Scope of Patent Protection
March 22, 2012

those cases reached different outcomes because the method claimed in Diehr included steps — in
addition to the law of nature — that “transformed the process into an inventive application of the formula,”
while the claims in Flook included “no ‘inventive concept’” beyond the natural law.
The <strong>Court</strong> explained that the “danger . . . of patents that tie up” laws of nature is “acute” in two
circumstances: first, when patents claim nothing “more than an instruction to ‘apply the natural law,’” and
second, when a patent “forecloses more future invention than the underlying discovery could reasonably
justify.” Thus, patents that specifically invoke a law of nature need to present “additional features that
provide practical assurance that the process is more than a drafting effort designed to monopolize the law
of nature itself.” The breadth or narrowness of the “law of nature” encompassed by a patent does not
matter, because “even a narrow law of nature . . . can inhibit future research,” and “judges are not
institutionally well suited to . . . distinguish[ing] among different laws of nature.”
In rejecting the claims at issue, the <strong>Court</strong> concluded that, beyond a law of nature, the claims described
only a “well-understood, routine, conventional activity, previously engaged in by those in the field.” The
drugs at issue had been used to treat these same conditions for decades, and scientists “routinely
measured metabolites” when assessing their efficacy. Moreover, because these well-understood steps
were necessary for any person to apply the natural laws in question, “the effect is simply to tell doctors to
apply the law somehow when treating their patients,” using routine steps that were not improved upon by
the patent. In short, the claims were not patentable because they encompassed a law of nature, and the
additional steps were not sufficiently inventive to impart patentability.
While rejecting the Federal Circuit’s application of the machine or transformation test, the <strong>Supreme</strong> <strong>Court</strong>
nevertheless appeared to preserve that test as “an important and useful clue.” It held that the Federal
Circuit applied the test incorrectly because the particular transformations on which the Federal Circuit
relied were either “irrelevant” or not required.
IMPLICATIONS
The decision in Mayo may well have broad implications in a variety of fields because, as the <strong>Court</strong> noted,
all patented inventions in some sense rest on or apply laws of nature. The decision may, in particular,
implicate many existing patents in the biotech, medical diagnostics and pharmaceutical fields. However,
the precise effect will depend on a close reading of the Mayo decision and a detailed examination of the
particular claims. Claim analysis will be required to determine, among other things, whether the steps of
the claim beyond any law of nature are sufficiently “inventive” to impart patentability under § 101.
The Mayo decision also suggests an answer to a question raised by conflicting decisions in the Federal
Circuit: should analysis of subject matter eligibility under § 101 precede other conditions of patentability
such as novelty or obviousness contained in other provisions of the patent statutes (e.g., §§ 102, 103)?
Compare Dealertrack v. Huber, Nos. 09-1566, 09-1588, 2012 WL 164439 (Fed. Cir. Jan. 20, 2012)
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<strong>Supreme</strong> <strong>Court</strong> <strong>Decision</strong> on Scope of Patent Protection
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(Linn, J.) (noting that § 101 is a “threshold” inquiry (quoting Bilski), over dissent by Judge Plager), with
MySpace, Inc. v. GraphOn Corp., No. 2011-1149, 2012 WL 716435 (Fed. Cir. Mar. 2, 2012) (Plager, J.)
(“[C]ourts should avoid reaching for interpretations of broad provisions, such as § 101, when more
specific statutes, such as §§ 102, 103, and 112, can decide the case.”). In Mayo, the <strong>Supreme</strong> <strong>Court</strong>
acknowledges that “the § 101 patent-eligibility inquiry . . . might sometimes overlap” with other inquiries,
but appears to favor addressing § 101 first, because shifting the inquiry to later sections “risks creating
significantly greater legal uncertainty.”
* * *
Copyright © Sullivan & Cromwell LLP 2012
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<strong>Supreme</strong> <strong>Court</strong> <strong>Decision</strong> on Scope of Patent Protection
March 22, 2012

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<strong>Supreme</strong> <strong>Court</strong> <strong>Decision</strong> on Scope of Patent Protection
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