A Long Shot
Senator Patrick Leahy, Chairman of the Senate Judiciary Committee wrote to Dr. Francis Collins asking NIH to exercise its march-in rights to force Myriad Genetics to license its BRAC genetic tests for breast and ovarian cancer. In the letter, Senator Leahy writes, "Myriad's patents were based in part on federally-funded research. Federally-funded research is playing an increasingly important role in our patent system. The Bahy-Dole Act encourages the commercialization of inventions created with federal funds by permitting the recipient to take title the inventions, generally without reimbursing the government.
"But the Bayh-Dole Act also gives the government tools, known as "march-in-rights," to provide greater access to the subject invention in appropriate situations. The government can require the patent holder to grant a license to the patent on reasonable terms. If the patent owner refuses, the government can directly license the patent in limited circumstances, including if it is necessary to alleviate health and safety need which are not reasonably satisfied" by the patentee."
The short version of March In Rights is that If the patent holding organization is not diligently proceeding to commercialization, the government has march-in rights and can force the organization to license the patents upon reasonable terms to the government or other organizations. Basically this means that if a research and development organization isn't commercializing the technology in a patent and another organization decides it wants to use the technology, the government can make the patent assignee license the technology under terms that it deems to be fair and reasonable.
While Myriad genetics lost its case before the Supreme Court on the patentability of the gene itself, the patent it holds for the complementary DNA (cDNA) is valid. Association for Molecular Pathology vs. Myriad Genetics, Inc., was argued before the Supreme Court April 15, 2013. Under the June 13 ruling, synthetic genes, such as complementary DNA, are eligible for patents, but naturally occurring genes or mutations are not. Senator Leahy, like many others are unhappy about the monopoly Myriad holds on the genetic test for the presence of the BRAC gene indicating breast and ovarian cancer and more importantly the fact that it costs $3,000-$4000 to have the test done. A cost that is prohibitive for many patients. There are also issues about the ability of the patient to get a second opinion because the test can only be done by Myriad. The March In rights angle is interesting and will certainly be contentious.
A very high barrier
Bayh-Dole — 35 USC Section 203 states,
(1) action is necessary because the contractor or assignee has not taken, or is not expected to take within a reasonable time, effective steps to achieve practical application of the subject invention in such field of use;
(2) action is necessary to alleviate health or safety needs which are not reasonably satisfied by the contractor, assignee, or their licensees;
Myriad Genetics, Inc. (NASDAQ-MYGN) is a publicly traded company has a $2.4B market cap, an a per share price hovering around $30/share. It's business is genetic testing. They have clearly taken within a reasonable time, effective steps to achieve practical application of the subject invention in such field of use. The firm commercialized its patented technology, created a going concern, and is making money. It has hired employees most of whom have highly specialized skills, it pays taxes. The Senator's letter states that the test is an important tool in early detection of breast cancer, a statement which confirms the commercial value of Myriad test products and services. So it will be hard to claim that the company didn't meet the timely commercialization requirement.
On the matter of alleviating healthier safety needs not reasonably met by Myriad, they will need to show that there is a health or safety need that are not reasonably satisfied by Myriad. The Senator's letter does not question the efficacy of the test or raises problems that would indicate a safety risk to the public or the practitioners of the invention. What is at issue here is the price and a desire on the part of patients to have access to a different provider.
There have been only four previous march-in petitions made under Bayh-Dole all of which were made to NIH. In the past, NIH has been adverse to intervening in the market. One of the petitions was focused on NORVIR, a prescription drug used to treat AIDS. NIH denied the petition citing that NIH should not address the issue of drug pricing, only Congress. In the same petition, NIH found that there was no evidence that health and safety needs were not adequately met by the patent holder, Abbott.
In the case of Myriad, the test is available, there is no evidence of clinical issues that would indicate that they are creating a health or safety issue in how they conduct the tests or in the quality of the results. Senator Leahy's letter notes the importance the test. Again, the issue here seems to be with the monopoly exclusionary rights of a business built around a patented technology. That monopoly is the essential benefit of the patent and the business built around it.
If past history is a barometer for the future, NIH will set a very bar and it is unlikely that it will be able to intervene in a matter that seems purely economic. It looks like all the letter may accomplish is to put more pressure on Myriad Genetics to license their genetic test methods and to lower the price of this essential test. Civil society groups focused on providing greater access to this important test may be disappointed by the outcome but it is worth the fight for women and to bring awareness of the sometimes unforeseen consequences of a patent monopoly. This is a no joy situation.