December 3, 2012
Last Friday, the Supreme Court granted certiorari in two cases of interest to the business community:
Federal Food, Drug, and Cosmetic Act—Federal Preemption of Design-Defect Claims
In PLIVA, Inc. v. Mensing, 131 S. Ct. 2567 (2011), the Supreme Court held that state-law failure-to-warn claims against generic-drug manufacturers were preempted by the Federal Food, Drug, and Cosmetic Act (FDCA), which prohibits generic-drug manufacturers from making any changes to the FDA-approved labeling of their products. On Friday, the Supreme Court granted review in Mutual Pharmaceutical Co. v. Bartlett, No. 12-142, to resolve a circuit split over whether the Court’s decision in Mensing extends to state-law design-defect claims, given that the FDCA similarly restricts alterations in the design (i.e., composition) of generic drugs. The Court will decide whether the First Circuit erred in concluding that no conflict existed for preemption purposes where the petitioner could have complied with both state and federal law by withdrawing its product from the market. The Court implicitly rejected this rationale for labeling requirements in Mensing.
Petitioner Mutual Pharmaceutical manufactures the generic drug sulindac, an anti-inflammatory medication. Respondent Bartlett filed suit in New Hampshire state court, alleging that she was injured as a result of ingesting the medication; she asserted several tort theories, including design defect and failure to warn. Mutual removed the case to federal court and argued that Bartlett’s claims were preempted, but the district court rejected that argument. A jury returned a $21 million verdict on Bartlett’s design-defect claim. The First Circuit affirmed, holding that Mensing applies solely to failure-to-warn claims. Bartlett v. Mut. Pharm. Co., 678 F.3d 30 (1st Cir. 2012).
Although the First Circuit acknowledged that the FDCA does not permit a manufacturer to change the composition of a generic drug any more than it permits the manufacturer to alter the warnings, the court nonetheless held that states might be allowed to require generic-drug manufacturers to refrain from marketing FDA-approved products “despite what the Supreme Court made of similar arguments in the labeling context” in Mensing. Id. at 37. The First Circuit’s holding conflicts with decisions of the Fifth, Sixth, Eighth, and Ninth circuits, all of which have held that Mensing applies to design-defect claims.
Bartlett is significant for the business community because its resolution will clarify the scope of generic-drug makers’ potential liability under state tort law for allegedly defective products that were approved by the FDA.
Absent extensions, amicus briefs in support of the petitioner will be due on January 21, 2013, and amicus briefs in support of the respondent will be due on February 20, 2013. Any questions about the case should be directed to Hank Bullock (+1 212 506 2528) or Lauren Rosenblum Goldman (+1 212 506 2647) in our New York office.
Patent Law—Patentability of Human Genes
Federal patent law broadly permits an inventor to patent “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” 35 U.S.C. § 101. Interpreting this language, the Supreme Court has long held that “‘[l]aws of nature, natural phenomena, and abstract ideas’ are not patentable.” Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1293 (2012) (quoting Diamond v. Diehr, 450 U.S. 175, 185 (1981)). On Friday, the Supreme Court granted certiorari in Association for Molecular Pathology v. Myriad Genetics, Inc., No. 12-398, to decide whether the identification and isolation of a particular human gene is patentable under § 101.
Within each human cell are chromosomes of deoxyribonucleic acid (“DNA”), which have a double-helix shape corresponding to matched pairs of nucleotides. Particular sequences of nucleotides represent the “codes” for building cellular proteins. Together, sequences of particular protein codes are termed “genes.” Naturally occurring alterations—mutations—in genes are known to result in certain diseases or increased risk of developing a disease.
In the 1990s, Myriad Genetics identified two human genes, BRCA1 and BRCA2, linked with increased risks of breast and ovarian cancer. Myriad then filed for patents on (1) molecules of nucleotide sequences comprising the isolated genes, removed from a chromosome and with half the double-helix removed; (2) molecules of nucleotide sequences comprising solely the “coding” portions of these genes (“cDNA”); (3) any sequence from BRCA1 or BRCA2 of at least 15 nucleotides; and (4) methods for comparing an individual’s DNA to known mutations in BRCA1 or BRCA2 linked with increased risks of breast and ovarian cancer.
Upon identification of BRCA1 and BRCA2, numerous physicians began offering tests to determine whether their patients possessed a mutation in one of these genes associated with higher risks of cancer. This process involved use of or comparison with the nucleotide sequences that Myriad patented. Citing these patents, Myriad Genetics sent these doctors letters requesting that they cease offering the tests to patients unless they used Myriad’s labs to make the genetic comparison. A number of these doctors, along with other physician groups, filed suit for a declaratory judgment that Myriad’s patents were invalid. The district court agreed and invalidated the patents.
On appeal, a panel of the Federal Circuit substantially reversed, with each of the judges filing a separate opinion. Judge Lourie wrote that the isolated genes, patented cDNA, and nucleotide sequences differ chemically from the BRCA1 and BRCA2 genes as they exist within human chromosomes. Therefore, Judge Lourie concluded, the patents in question were not merely describing “laws of nature” or naturally existing phenomena. Judge Moore concurred, observing that the U.S. Patent Office had created settled expectations by permitting patents for isolated genes since at least 2001. Judge Bryson dissented, arguing that merely identifying a gene and isolating it from a chromosome was not sufficiently transformative to remove the discovery from the laws-of-nature exception to patentability.
The Supreme Court granted a petition for certiorari from the plaintiffs, vacated the Federal Circuit’s decision, and remanded the case for reconsideration in light of the Supreme Court’s recent decision in Mayo. On remand, each judge issued substantially the same opinion as before on the questions of the patentability of isolated genes and cDNA sequences. The judges agreed that Mayo was not relevant to whether they were “laws of nature.” But in light of Mayo, which addressed patents on methods of performing tasks and comparisons, the judges agreed that the vast majority of Myriad’s patents describing methods for comparing a patient’s genes to the known nucleotide sequences and DNA molecules were invalid.
Plaintiffs again petitioned for certiorari, raising three questions, including whether human genes are patentable. In response, Myriad conceded that human genes, as they exist within the body, are not patentable. But, Myriad argued, the proper question was whether it was possible to patent a distinct set of molecules, separate from a chromosome and with only half the DNA’s double-helix. Numerous medical and physician groups filed amicus briefs in support of the petition. The United States did not file an amicus brief with respect to the petition, but had previously filed an amicus brief in the court of appeals arguing that the isolated genes are not patentable while the cDNA molecules are. The Supreme Court granted review solely on the question whether human genes are patentable.
The case is of significant interest to many members of the business community. Most concretely, it may directly affect the medical and pharmaceutical industries, as well as research institutions: Since the U.S. Patent Office first started issuing patents on isolated genes, it has approved numerous requests for such patents on genes associated with a wide variety of diseases and risk factors. In clarifying the “laws of nature” and “natural phenomenon” exceptions to § 101, the Supreme Court’s decision may also affect all businesses that make use of basic scientific principles in their patented inventions.
Absent extensions, amicus briefs in support of the petitioners will be due on January 14, 2013, and amicus briefs in support of the respondent will be due on February 14, 2013. Any questions about the case should be directed to Tim Bishop (+1 312 701 7829) or Jeff Sarles (+1 312 701 7819) in our Chicago office or Charles Rothfeld (+1 202 263 3233) in our Washington office.
Today, the Supreme Court invited the Solicitor General to file a brief expressing the views of the United States in the following case of interest to the business community:
Law v. Siegel, No. 12-5196: The question presented is whether the Ninth Circuit erred in allowing the bankruptcy trustee to surcharge the debtor’s constitutionally protected homestead property?
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