D’Arcy v Myriad Genetics Inc.

On 7 October 2015, the High Court of Australia unanimously allowed Ms D’Arcy’s appeal from the Full Federal Court decision in D’Arcy v Myriad Genetics Inc (2014) 224 FCR 479 (‘D’Arcy’), holding that Myriad’s claims to isolated nucleic acids were not patentable subject matter.

The decision relates to Australian Patent 686004, which includes claims to methods of diagnosing a predisposition for breast and ovarian cancer, as well as claims to isolated nucleic acids related to those methods. The claims to the methods, probes, cloning and expression vectors, and host cells, were not in issue. The High Court, whose decision relates to whether under Australian law, claims directed to isolated nucleic acids were a “manner of manufacture”, and therefore patentable subject matter.

Prior to the High Court decision, a Full Federal Court had held that isolated nucleic acids were different to the gene comprising the nucleic acid sequence as it exists in nature, and that the isolation of the nucleic acid lead to an economically useful result – the treatment of breast and ovarian cancers. The Full Court concluded that the isolated nucleic acid, including cDNA, was an artificially created state of affairs of economic benefit, and was therefore patentable.

While the patent expired on 11 August 2015 at the end of its term, the High Court held that the invention claimed in the relevant claims (a nucleic acid coding for a BCRA1 protein with one or more specified variations indicative of susceptibility to breast cancer and ovarian cancer) did not fall within the concept of a manner of manufacture.

In making this finding the Court focussed on the significance of the genetic information in the nucleotides of the claims rather than the isolated nucleotides being a tangible product per se, stating:

‘Despite the formulation of the claimed invention as a class of product, its substance is information embodied in arrangements of nucleotides. The information is not “made” by human action. It is discerned. That feature of the claims raises a question about how they fit within the concept of a “manner of manufacture”. As appears from s 6 of the Statute of Monopolies, an invention is something which involves “making”. It must reside in something. It may be a product. It may be a process. It may be an outcome which can be characterised, in the language of NRDC, as an “artificially created state of affairs”. Whatever it is, it must be something brought about by human action.’

D’Arcy v Myriad Genetics Inc.
D’Arcy v Myriad Genetics Inc.

Consideration was also given to whether the isolated nucleic acids were an ‘artificially created state of affairs’, in relation to which the Court commented:

Ms D’Arcy also engaged with the finding by the Full Court that the isolated nucleic acids were patentable as “an artificially created state of affairs”. Engaging with that criterion in this case places the question of patentability in too narrow a frame. It invites debates about the application of categories such as “products of nature” versus “artificially created products” which may be distracting from the central issue, that is whether an essential integer of the claims, the genetic information, takes them outside the category of that which can be “made”. But even if the criterion of an “artificially created state of affairs” were to define the area of discourse in this case, the fact of the existence of the requisite mutations or polymorphisms is a matter of chance. It is not something “made”. It is not “artificially created”.’

The Court held that while the invention claimed might strictly be classified as a product of human action, it was the existence of the information stored in the relevant sequences that was an essential element of the invention as claimed:

‘Although it may be said in a formal sense that the invention as claimed, referring to isolated nucleic acids, embodies a product created by human action, that is not sufficient to support its characterisation as a manner of manufacture. The substance of the invention as claimed and the considerations flowing from its substance militate against that characterisation. To include it within the scope of a “manner of manufacture” involves an extension of that concept, which is not appropriate for judicial determination.’

The finding that the features of the claims and their ‘substance as an invention’, related to ‘sequence information’, led to the conclusion that patentability would not serve the purposes of the concept of “manner of manufacture”. The Court also attached the same informational characteristics to cDNA.

It was initially unclear whether the decision would have a broad or narrow impact on the biotechnology industry.

On 16 October 2015, IP Australia issued their proposed practice for applying Myriad for public consultation.

The proposed practice indicates that on the basis of the decision, the Commissioner considers the following are not patent eligible and will not accept claims for:

> Naturally occurring (human or nonhuman) nucleic acid sequences encoding polypeptides or functional fragments thereof – either isolated or synthesised cDNA

> Naturally occurring human and nonhuman coding RNA – either isolated or synthesised.

The Commissioner proposes the following remain patent eligible on the basis that they do not merely represent information coding for a polypeptide:

> Naturally occurring isolated regulatory DNA (e.g. promoters, enhancers, inhibitors, intergenic DNA)

> Isolated non-coding (e.g. “Junk”) DNA and isolated non-coding RNA (e.g. miRNA)

> Naturally occurring isolated bacteria

> Naturally occurring isolated virus

> Isolated polypeptides, including isolated polyclonal antibodies

> Synthesised/modified polypeptides

> Chemical molecules purified from natural sources (e.g. new chemical entities, antibiotics, small molecules)

> Isolated cells, including isolated stem cells

> Probes

> Primers

> Isolated interfering/inhibitory nucleic acids (e.g. antisense, ribozymes)

> Monoclonal antibodies

> Fusion/chimeric nucleic acids

> Transgenes comprising naturally occurring gene sequences

> Vectors/microorganisms/animals/plants comprising a transgene.

Given the practice is focused on nucleic acids that merely represent information coding for a polypeptide, the practical impact of the decision is likely to be less of a concern to the Biotechnology sector than some feared.

Consultation on the proposed practice closed on Friday 6 November 2015, and we are awaiting issuance of the final practice.

Interim measures

IP Australia has also begun issuing correspondence in relation to patent applications with claims to isolated nucleic acids that are under examination.

For applications approaching their acceptance deadline with claims to isolated nucleic acids, the Commissioner has indicated that she is still considering how the technology is impacted by the decision of the High Court, and depending on the outcome of this consideration it may be necessary to raise an objection to these claims. The correspondence proposes options for the applicant to consider in the interim:

‘… file amendments to the application to clearly remove any subject matter of concern,

allow the application to remain pending in its present form (noting that the application will lapse if the final date for acceptance is reached), or

file a divisional application in order to keep this matter pending and the applicant may consider applying for fee waivers for such applications.’


In the case of Oppositions to grant involving applications with claims to isolated nucleic acids, IP Australia have been issuing correspondence indicating that the High Court decision in D’Arcy may be relevant to the determination of the opposition and inviting both parties to provide written submissions on the relevance of the decision to the claims. The correspondence indicates the hearing officer will take into consideration any submissions made in coming to a decision. We are yet to have any opposition decisions issue on such claims following the decision in D’Arcy.

Interestingly, the Office has also begun citing D’Arcy in support of the approach taken in Research Affiliates LLC v Commissioner of Patents [2014] FCAFC 150, of examining the ‘substance of the invention’ in considering the patentability of a scheme or abstract idea implemented on a computer (see General Electric Company v Ausrail Technologies Pty Ltd [2015] APO 67 at paragraph 103):

‘The Full Court decided that the implementation of a scheme or abstract idea, which itself would not be considered to be patentable subject matter, would not be rendered patentable subject matter through implementation on a computer. The substance of the invention is determined not as a matter of form but involves an analysis of the alleged inventive step compared to the prior art. This approach of examining the ‘substance’ of the invention was also mentioned in D’Arcy …’.

It appears that examination of the substance of the invention, rather than just the form of the claims, will be an important part of considering whether an invention as claimed can be characterised as a manner of manufacture.

BSc(Hons) MCommrclLaw PhD FIPTA GAICD

Mark’s work focuses on the preparation and prosecution of patent applications in Australia and internationally, due diligence, freedom to operate and invalidity advice for the pharmaceutical, biotechnology, health and medical device industries.