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Actress Angelina Jolie said in May she had a double mastectomy after Myriad's tests showed she had a gene mutation linked to breast cancer.

Supreme Court limits gene patents

WASHINGTON - The U.S. Supreme Court on Thursday restricted the ability of companies to patent human genetic sequences, issuing a mixed ruling in a case that raised questions about thousands of biotechnology, agricultural and drug patents.

The justices unanimously ruled that parts of Myriad Genetics Inc.'s patents on genes linked to breast and ovarian cancer improperly covered natural phenomena. Other parts, the court said, involve enough human intervention to be eligible for legal protection.

The decision left both sides of the debate with grounds for claiming victory. It forces a change at the federal patent office, which has been awarding gene patents since 1982. That's a victory for doctors' groups and patient advocates that accused Myriad of using its patents to block clinical testing and research.

"Because of this ruling, patients will have greater access to genetic testing and scientists can engage in research on these genes without fear of being sued," said Sandra Park, an attorney with the American Civil Liberties Union, which sued to challenge the Myriad patents.

"This is a win fundamentally" for Myriad, wrote Michael Yee, an analyst at RBC Capital Markets in a note to clients after the ruling. Potential competitors for Myriad's main hereditary breast and ovarian cancer risk test "remain unlikely to launch at risk" because the company has 24 patents on its gene tests that remain in force, he wrote.

Actress Angelina Jolie said in May she had a double mastectomy after Myriad's tests showed she had a gene mutation linked to breast cancer.

Biotechnology, agriculture and drug industries backed Myriad in the case, telling the court that gene patents have led to valuable treatments. The decision will have implications for the growing field of personalized medicine and efforts to map the human brain and discover new uses for embryonic stem cells.

Genes are encoded strands of nucleotides in different sequences that are responsible for inherited traits. Myriad's patents covered sequences in the form known as "isolated DNA" after they have been removed from the body.

"Myriad did not create anything" with isolated DNA, Justice Clarence Thomas wrote for the court. "It found an important and useful gene, but separating that gene from its surrounding genetic material is not an act of invention."

At the same time, Thomas said synthetic molecules known as complementary DNA, or cDNA, can be patented because they require a significant amount of human manipulation to create. Those molecules are stripped-down versions of the genetic sequence within the body, including only the parts of the gene that can encode proteins.

"The lab technician unquestionably creates something new when cDNA is made," Thomas wrote. Thomas' reasoning largely followed the position of the Obama administration.

The decision creates a balance between researchers and businesses, said Matthew Dowd of Wiley Rein in Washington, who submitted a brief on behalf of James Watson, the co-discoverer of the structure of DNA. Watson, a Nobel Prize winner for his discovery who helped found the Human Genome Project, objected to patenting of the isolated DNA.

"It does free up and ensure the free use of human genes, which are naturally occurring products," Dowd said in an interview. "At the same time, it will probably be viewed as providing enough incentive for those scientists developing biotech inventions."

A group of doctors, patients and researchers challenged the Myriad patents, arguing that isolated DNA is identical to the coding that exists naturally in the body. Those supporting the challenge included the American Society of Human Genetics, the American Medical Association and AARP, which represents older Americans. Lawyers at the ACLU and the Public Patent Foundation in New York represented the challengers.

Myriad argued that isolated DNA has a different physical structure and chemistry than genes within the body. Biotechnology companies contended that they have been getting patents on genes for 30 years, and can't attract investment dollars unless they can protect their research from competitors.

Salt Lake City-based Myriad in 1994 won a race among five research groups to pinpoint the genetic sequences associated with DNA mutations that indicate hereditary risk for breast and ovarian cancer. Myriad then developed tests for the mutations.

Gene databases and technology to analyze them can be the key to medical discoveries and more efficient ways of providing treatment. Annual U.S. spending on medical DNA testing will rise to $25 billion in the next decade from $5 billion in 2010, according to UnitedHealth Group Inc., the biggest for-profit health insurer in the nation.

Genetic testing is a hallmark of the growing field of personalized medicine, in which doctors determine whether a patient is susceptible to a particular disease or would be more responsive to certain medications.

The dispute came to the court in an emotionally charged package, with patient advocates accusing Myriad of standing in the way of breast cancer diagnosis and treatment. The company at one point demanded that the University of Pennsylvania stop clinical testing of cancer patients.

The U.S. Court of Appeals for the Federal Circuit largely sided with Myriad, saying isolated DNA could be patented.

Robert Langreth in New York contributed to this story.