Myriad complications

On July 9, 2013 Myriad Genetics filed suit against Ambry Genetics in the District of Utah, Central Division for infringement of numerous patent claims in several patents which Myriad either owns or holds the license for. A copy of the complaint can be seen here   A detailed analysis of the claims asserted has been posted by Patent Docs as Myriad Genetics Files Suit Against AmbryGenetics for Genetic Diagnostic Testing of BRCA Genes .

For those of you that are not familiar with the story, Myriad Genetics has patent rights for BRCA1 and BRCA2 screening. A consortium led by the ACLU and AMA spent several years in court trying to get some of the Myriad patent claims invalidated as being directed towards non-patentable subject matter. Ambry is a "generic" competitor offering similar screening following the outcome of the earlier lawsuit.

The current complaint is in response to an announcement by Ambry that it would begin to offer BRCA testing .

One interesting thing is that Ambry offers three different types of BRCA tests, priced at $3300; $2200 and $500. Ambry also indicates that it will provide BRCA1 and BRCA2 gene sequencing and deletion/duplication results at no extra charge as part of its existing “BREAST NEXT” ($4,120); “OVANEXT” ($5,310) and “CANCERNEXT” ($5,830) NGS panels.  Those of you that have been following the Myriad saga from the district court in New York, to the Court of Appeals of the Federal Circuit (CAFC) and then to the Supreme Court (SCOTUS) are aware that the plaintiffs (including the ACLU and the AMA) were vociferous in their opinion that the patents held by Myriad were keeping the cost of BRCA1/2 testing high, to the detriment of women that wanted to know what their risk of developing breast cancer/ovarian cancer is. 

For the sake of comparison, testing by Myriad Genetics is priced at about $3000 (data from Maricopa IntegratedHealth Services).

To the best of my knowledge, neither the ACLU nor the AMA has criticized Ambry’s price schedule. 

Myriad genetics offers a financial  assistance program for uninsured patients, and a 25 month payment plan for insured patients. Ambry genetics also offers a financial assistance program. Comparison of the relative merits of the two financial assistance programs is beyond the scope of this blog.

Looking at the list prices, it is not at all clear if testing by Ambry is significantly cheaper than testing by Myriad. Even with a Ph.D. in molecular biology I’m not sure what are the differences between the $3300; $2200 and $500 tests offered by Ambry. It seems likely that the typical patient concerned about her future risk of breast/ovarian cancer has less than a Ph.D. in molecular biology. While we would all like to believe that her primary care physician can provide meaningful guidance on the differences between the $3300; $2200 and $500 tests, that is not always the case.

Hypothetically, a woman that received “bad news” from the $500 Ambry test could easily consider ponying up another  $3300 or $2200 before undergoing the double mastectomy/ovarectomy she was presumably contemplating if she took the test. This would bring the total cost into the same price range as the Myriad test or higher. 

Conversely, a woman that received “good news” from the $500 Ambry test might still be uncertain as to the reliability of the “cheap test” and  lay out  another  $3300 or $2200 to be certain she doesn’t need a double mastectomy/ovarectomy.  After all, the ACLU and AMA also stressed the importance of a woman’s right to a second opinion. Again, this would bring the total cost into the same price range as the Myriad test or higher. 

So, what did the much touted legal battle concerning the BRCA portfolio belonging to Myriad genetics actually accomplish?

Well, some patent claims were invalidated by the CAFC. Additional patent claims were invalidated by SCOTUS. 

Was this a victory for the ACLU, the AMA and the various patients and doctors that joined the suit? 

Perhaps not. 

The Supreme court decision clearly indicates :

“[a]s the first party with knowledge of the [BRCA1 and BRCA2] sequences, Myriad was in an excellent position to claim applications of that knowledge. Many of its unchallenged claims are limited to such applications.”

SCOTUS did what it routinely does. It issued a decision, accompanied by a clear statement of what that decision does not do. 

One of the things the SCOTUS decision does not do is prevent Myriad from enforcing its rights based upon any claims not invalidated by the CAFC or SCOTUS. While there is a theoretical possibility that the District of Utah, Central Division will find that Myriad is estopped by the previous lawsuit, that seems unlikely.  One reason is that Myriad is physically located in Utah and therefore enjoys a “home court” advantage.  Another reason is that Ambry was not a party to the previous lawsuit; presumably because they were not offering testing services which could be perceived by Myriad as infringing their patent claims until after the previous suit had run its (incredibly long) course. Another reason is that the claims at issue in the case against Ambry were not at issue in the previous case because there was no allegation of infringement in that case.

The previous lawsuit seems to have helped Myriad retain exclusive control of the market for several years. The current complaint against Ambry seems likely to help them retain that exclusive control for several more years. 

Kudos to those that conceived and executed the Myriad BRCA patent portfolio. One of my mentors said “A good portfolio is one that takes so much time and money to analyze that nobody will do the analysis.”  That seems to be the case here. The analysis will occur during litigation and/or licensing negotiations.

Since the initial suit against Ambry is to be heard in a friendly jurisdiction, by a jury, and since the issue of section 101 patent eligibility has already been addressed by the courts, I predict that Ambry will need to do what all accused infringers hate to do: focus on whether infringement is actually occurring at trial.

Whether Myriad will visit the CAFC and/or SCOTUS again is anybody’s guess.