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There has long existed a debate on the patenting of genomic and biomedical data.10 Since the beginning of the COVID-19 global pandemic, healthcare advocates, governments, and scholars worldwide have expressed concern that patents would slow the manufacturing of medical supplies, vaccines, equipment, and therapies as well as distribution of supplies to those who really need them.11 On the other hand, countless scientists and researchers have called for patent protection for genomic and biomedical discoveries because patents allow pharmaceutical companies to recoup the massive investments they put into researching and developing.12 The potential patent protections of genomic and biomedical data act as incentives to spur the development of methodologies and technologies that can prevent future pandemics and foster innovation.13 In combating modern pandemics, patent law and protections for genomic and biomedical data have played a significant role in incentivizing vaccine innovation and cures related to viral infections. 14 While many assume that limiting patent protection allows for more vaccines to be produced, this assumption fails to recognize that being allowed to produce vaccines is starkly different from having the ability to produce vaccines to the same degree of effectiveness and safety.15 Creating clean and safe vaccines requires a high degree of knowledge, experience, and technological infrastructure.16 Having this knowledge, experience, and technological capability is especially important when producing vaccines based on the new mRNA technology, such as those produced by Pfizer, Moderna, and others.17 The new mRNA-based vaccines are significantly more expensive and complex to manufacture than the established vector vaccine. 18 For example, the vaccines are extremely sensitive to variations in temperatures and mostly require a constant set temperature. 19 Due to the unique challenges of manufacturing a COVID-19 vaccine, simply releasing patents will not guarantee that previously inexperienced pharmaceutical manufacturers worldwide will be suddenly able to produce clean and safe vaccines.20

Additionally, a single drug costs about $1.3 billion to $2.8 billion to produce.21 The government-initiated restriction on patent protections does not consider the complicated and cost-intensive development of drugs.22 It also fails to consider that the research and development of a medicine do not guarantee success.23 In the worst-case scenario, pharmaceutical manufacturers are expending billions of dollars to gain nothing in return.24 In the face of these multibillion-dollar R&D costs, pharmaceutical companies rely on patents to incentivize them to embark on costly and time-consuming research and development of new, breakthrough drugs.25

Admittedly, the delivery of vaccine doses has not been as widespread in developing countries as it has been in developed countries; as of June 2022, approximately 4.8 billion doses were delivered to patients in lower-income and lower-middle-income countries out of the 14 billion total doses delivered worldwide.2 But this has nothing to do with patents or any other IP rights. The causes are myriad, ranging from regulatory and trade barriers, lack of distribution infrastructure in the developing world, to vaccine hesitancy in some populations.

Thus, patents have been the basis of innumerable commercial agreements for decades in the biopharmaceutical sector. These economic activities created efficiency-maximizing supply chains, licensing of products and services to manufacture and distribute new therapeutic treatments, and ultimately formed a knowledge infrastructure in the growing biopharmaceutical sector. This preexisting commercial foundation served as the basis for the many cross-industry and cross-sector agreements that made possible the unprecedented response to the COVID-19 pandemic.17

By May 2020, less than half a year after the emergence of a previously unknown novel coronavirus eventually classified by the WHO as SARS-CoV2, the biopharmaceutical sector was researching and developing 430 unique active compounds to treat the COVID-19 illness.18 This number has almost doubled in 2 years. As of June 2022, there are now 854 unique active compounds under development, including 240 vaccines, 261 antivirals, and 353 therapeutic treatments. Almost half of these compounds under development (415) are by companies based in the U.S. (Figure 1).19

The invention, development, testing, and rollout of vaccines in response to the COVID-19 pandemic was the fastest in global history. The delivery of vaccine doses to patients in the developing world has lagged behind the developed world, but this was not caused by patents or other IP rights. There is no evidence that patents have blocked the research, development, or distribution of any vaccines for the treatment of COVID-19. The evidence is to the contrary: patents prompted the investment of billions of dollars over several decades in research and development efforts, as well as in creating a manufacturing and commercial infrastructure in the biopharmaceutical sector, that made possible the COVID-19 vaccines.

These investments were made possible given the reliable and effective patents rights secured in biotech innovations in the U.S. since the early 1980s.8 The result was the biotech revolution, driven by an explosion in biotech startups from Genentech in the early 1980s to Moderna today. The U.S. accounts for approximately 5% of the world’s total population and roughly 25% of global economic output, but over 50% of all new biotech innovations are created in the U.S.9

Taken together with the prior literature, our evidence suggests two conclusions. First, for the case of human genes, the traditional patent trade-off of ex ante incentives versus deadweight loss may be sufficient to analyze optimal patent policy design, because any effects of patents on follow-on innovation appear to be quantitatively small. Second, our evidence, together with the evidence from Williams (2013) on how a non-patent form of intellectual property on the human genome affected follow-on innovation, suggests a somewhat nuanced conclusion: while patent

protection on human genes does not appear to have hindered follow-on innovation, an alternative non-patent form of intellectual property—which was used by a private firm after its gene patent applications were largely unsuccessful in obtaining patent grants—induced substantial declines in follow-on scientific research and product development. This pattern of evidence suggests that changes to patent policy must carefully consider what strategies that firms will use to protect their discoveries in the absence of patents, and that an understanding of the relative costs and benefits of patent protection compared to those outside options is needed in order to evaluate the welfare effects of patent policy changes.

However, viewed through an alternative lens—what one might call the “disclosure” lens—this contrast is less surprising and perhaps even expected. The patent system requires inventors to disclose the claimed invention. Although theoretical models of intellectual property have tended to pay relatively little attention to the disclosure requirement, in our view this is a critical contrast between Celera’s intellectual property and gene patents. For gene patent applications, the patent system’s disclosure requirement induced explicit reporting of the claimed DNA sequence in a way that enabled open access to the sequence data underlying both accepted and rejected applications for all prospective follow-on users. In contrast, as detailed above Celera’s data were disclosed in a much more restrictive way.

Both the institutional details of our context and a growing academic literature suggest that this difference in disclosure may plausibly account for the different observed effects of Celera’s intellectual property and gene patents on follow-on innovation outcomes.50 Over the time period of our study, all DNA sequences claimed in patent applications submitted to the USPTO were disclosed in the main open-access databases (e.g., GenBank) used by researchers.51 In contrast, the no-redistribution restriction on Celera’s sequenced data meant that their data were not added to the key open-access databases that were widely used by researchers. A natural hypothesis is that this lack of open disclosure led to fewer scientific researchers analyzing Celera’s data, and that this in turn led to fewer commercializable discoveries. Consistent with this hypothesis, both the theoretical work of Aghion, Dewatripont, and Stein (2008) and other sources of empirical evidence (Furman and Stern 2011, Murray et al. 2016) suggest that limiting access to research materials may discourage follow-on research. Also consistent with this hypothesis, and with our empirical results, Galasso and Schankerman (2015) find no evidence that patent invalidations—which should induce a change in licensing requirements but no change in disclosure—increase patent citations (their measure of follow-on innovation) in the technology field that includes most of our gene patents.52

In contrast with what one would infer from a naïve comparison of follow-on innovation on patented and non-patented genes, both of our quasi-experimental approaches suggest that gene patents have not had quantitatively important effects on either follow-on scientific research or follow-on commercial investments. The estimates from our first quasi-experimental approach—comparing follow-on innovation across genes claimed in successful versus unsuccessful patent applications— document estimates which are economically small and meaningfully precise. While the estimates from our second quasi-experimental approach—using the leniency of the assigned patent examiner as an instrument for which patent applications are granted patents—are less precise, the fact that these two approaches generate similar conclusions provides additional confidence in our estimates.

When interpreting these empirical results through the lens of the well-developed theoretical literature on cumulative innovation (e.g., Green and Scotchmer 1995), several points are relevant to highlight. First, as best we can measure, very little of the follow-on innovation in this market is done by the gene patent holders, suggesting that follow-on innovation in this market will often require licensing agreements. Second, essentially all (96 percent) of the patent applications in our sample are assigned to for-profit firms, and in the vast majority of clinical trials (86 percent) both the patent assignee and the follow-on innovator are for-profit entities. Taken together, these facts suggest that cross-firm licensing contracts in this market seem to have operated at least somewhat efficiently. Consistent with this interpretation, there has been relatively little patent litigation observed in this market.

The effects of patents on R&D are also context-dependent. A study by Bhavan Sampat and Heidi L. Williams, for example, suggests that gene patents had little effect on follow-on innovation and were preferable to trade secrecy. As Sampat and Williams note, underlying criticism of gene patenting “seems to be an assumption that if genes are not patented, they would be placed in the public domain.” Patents encourage disclosure and access: patents on genes make the information encoded in them free for all to use.

Unlike the United States, some other countries continue to permit the patenting of human genes. The EU, for example, explicitly allows for the patenting of genes.

In the EU, patents are processed by the European Patent Office (EPO) in compliance with the European Patent Convention (EPC).95 The EPC dictates that “any invention” may be patented,96 but it restricts this broad grant with specific limitations—for example, by indicating that “discoveries, scientific theories and mathematical methods” do not qualify as inventions.97 However, directives passed by the EU create carveouts to these restrictions. A 1998 directive of the European Parliament, for example, clarifies that DNA sequences are to be considered inventions—and not unpatentable discoveries—so long as the claimed sequence has an industrial application, such as use in the diagnosis of disease.98 Thus, in the EU, genes qualify as valid patentable subject matter through a narrowly tailored exception to a more general bar on patenting abstract scientific principles.99

Professor Jorge Contreras’ commentary on the Patent Eligibility Restoration Act of 2022 objects to Senator Thom Tillis’ recently introduced bill. Specifically, he argues that proposed inclusion of isolated and purified human genes and other naturally occurring substances as patent eligible subject matter is unnecessary and would both stymie research and obstruct access to medicine. But the truth is these criticisms rely mostly on narrative and anecdote rather than rigorous empirical evidence. (Professor Contreras has written an article acknowledging the many narratives behind the gene patenting debate: see Narratives of Gene Patenting, 43 Fla. St. U. L. Rev. 1133 (2016)).

A different narrative – and one that better reflects both technological and economic reality – is that including purified and isolated materials as eligible subject matter under 35 U.S.C. § 101 can benefit patients, researchers, and innovation. Legislatively overruling the Supreme Court’s 2013 decision in AMP v. Myriad Genetics could boost investment in biotechnology R&D. Identifying the existence, location, and sequence of the BRCA1 and BRCA2 gene variants at issue in Myriad, for example, took decades. New biologic therapeutics can require over $1 billion to develop. Without patents these innovations might never see the light of day.

Congress could decide whether to make all uses of the genetic association protected by patent law, such that those who later invent gene therapies or biologic products to treat a condition would have to first license the right to make use of the genetic association from the genetic association patent holder. This approach would greatly increase the incentive to make genetic association discoveries, because genetic association patent holders would share in the profits from follow-on treatments. This raises the specter of impeding downstream innovation because of the need to obtain a license from the genetic association patent holder, potentially causing patent thickets. But there is reason to think that impairment of downstream research would be rare since only a single gene association patent would have to be licensed, rather than hundreds or thousands of upstream patents that must be licensed in some high-tech products like smart phones. In addition, not only would genetic association patent holders be incentivized to license so as to share in the profits from downstream treatments, but the availability of downstream treatments would also encourage more people to get tested for genetic associations, further increasing profits. This is because before a treatment is available, some people would prefer not to know if they are more likely to suffer from a disease such as Alzheimer’s. But after a treatment is available, people would have incentives to get genetic testing so that they could treat the condition if they find out they are susceptible to it because of their genes. On the other hand, if Congress is concerned about patent thickets, it could amend the patent statute in various ways to restrict the assertion of genetic association patents only to the use of those genetic associations for diagnostic testing. For example, Congress could do this by creating a statutory patentability exception for genetic association patents while leaving unaltered the current statutory language for “new” and “utility.”

PHILIP JOHNSON: Well listen, listening to Mr. Blaylock's discussion about the isolated gene, I heard an awful lot about conventional this and conventional that, and so on, which would say to me that those are novelty or obviousness concerns and it may very well be that the isolated gene and what is done with it turns out not to meet those.

And that should be enough. It's not -- what -- what we're worried about and -- and what he has already acknowledged is there are some very important things lurking in the genome that could be incredibly important for our well-being in the future. And we should want to incentivize people to look for it and to spend the time and energy and money that is needed in order to find it. And these things don't -- don't announce themselves.

A second potential hurdle—should the Supreme Court want to restore gene patentability—is that the entirety of the human genome has now been sequenced. Prior to this, researchers looking for genetic associations had to determine both which gene caused a disease and what the structure of that gene was. Now that the structure of all genes in the human body are known, researchers are no longer discovering new genetic structures.257 Thus, even if the Supreme Court had gone the other way in Myriad, it is hard to see how human genes could be patented at this point because their structure is already known, and patent law does not allow patents on known products.258 In Parke-Davis & Co. v. H.K. Mulford Co.,259 doctors already knew that tissue from the adrenal glands could have beneficial effects for certain medical conditions. Dr. Takamine discovered how to make a concentrated and purified substance from the glandular tissue, which had superior medical effects. In that case, Judge Learned Hand held that Takamine’s purified adrenaline was patentable because “it became for every practical purpose a new thing commercially and therapeutically.”260 The problem with applying this reasoning to isolated DNA sequences is that the DNA had already been isolated when it was sequenced. Thus, researchers who discover new genetic associations are discovering valuable genetic information, but they are not making any novel transformation of physical matter, because the genes have already been isolated outside of the body for sequencing. Because isolated and sequenced genes are not new, they are not patentable subject matter under § 102, even if someone discovers a useful association between gene and disease.261 Accordingly, even were the Supreme Court to overturn Myriad, it would have to also make an exception to § 102 in order for gene patents to again be patentable.

CHRISTOPHER COONS: Mr. Iancu, do you agree with Mr. Block's assessment of PERA? Um, do you think we need additional legislative language to keep patentability requirements separate, or is that already implied in existing law? Would it have the impact that he's predicting?

ANDREI IANCU: No, I disagree with him on that. I think it's PERA addresses the fact that the pure natural product itself, and the statute says, quote, "as such is not eligible." It's one of the exclusions. As soon as that is applied by human hand and human ingenuity to a practical application such as diagnosing in a diagnostic kit, a particular disease, that is human innovation and that should be eligible.

PHILIP JOHNSON: OK, well, first, as to retarding research, I couldn't disagree more. The fact of the matter is we -- first, we have the Hatch-Waxman 271 (e) (1) exemption, which allows for free research, as long as it's related to developing information for the eventual submission to the FDA. But the experience has shown that people who discover and have these inventions don't privatize them.

They naturally would like to commercialize them or at least get them spread out and used, widely. And in fact the -- when there have been very dramatic advances done in the biotechnology area, licenses have been made available because it takes a village to do all of the research that's needed in different applications.

It is important to acknowledge the point that many opponents of PERA have advanced – genes as part of the human body are not eligible and never were. PERA emphasizes that unmodified genes as they exist in the human body will remain ineligible. PERA is intended to override the Supreme Court’s decision in the Myriad Genetics case with respect to genes that have been isolated or otherwise modified by human effort. Stated differently, PERA will allow the eligibility of “genes that have been isolated, purified, enriched or otherwise altered by human activity,” provided they meet the other statutory tests for patentability. Isolating a gene to determine its specific function or the specific types of cell in which the gene expresses its particular protein often requires a lengthy study and extensive experimentation. Patents create incentives to invest time and capital in determining the correlation between a particular gene and a particular disease state, so eligibility is an essential prerequisite.

“We Know How to Prevent the Next Pandemic—But It’s Easier Said Than Done” Global Health Now, 10/27, //DH

Where does the world currently stand in terms of achieving pandemic preparedness?

COVID-19 was a catastrophe and, throughout history, humanity’s responses to catastrophes have been a nearly unbroken series of abject failures. And now, as avian influenza spreads through dairy cattle herds in multiple states, many healthcare leaders say they would not be ready if it spreads widely among humans.

Meanwhile, the Centers for Disease Control is being hamstrung by state agriculture departments and dairy farmers, as it struggles to track the virus. Politico describes this gap as “emblematic of the trust gap between key agriculture players in both red and blue states and federal health officials.”

After more than two years of discussion and negotiations, the representatives for 194 nations failed to finalize a draft of the Pandemic Agreement, an international accord meant to fix the weaknesses and global inequities in pandemic preparedness that COVID-19 revealed.

The chairs of the World Health Organization's Intergovernmental Negotiation Body (WHO INB), which convened the deliberations, conceded on May 24 that negotiators would be unable to deliver a draft accord in time for the seventy-seventh World Health Assembly (WHA), which begins on May 27 and would have been responsible for approving the treaty.

My practice does not focus on patent litigation, but I understand that Alice and Mayo have impacted patent litigation by permitting patent challengers to invalidate patents at an early stage of litigation, such as at the motion to dismiss stage, on a record with very little or no evidence other than the patent document itself. Moreover, the uncertainty surrounding the scope of the “judicial exceptions” and the willingness of courts to invalidate seemingly concrete inventions as “abstract ideas,” has incentivized challenges based on patent eligibility. PERA would reign in the use of Section 101 as a blunt instrument against patents, and would require patent eligibility determinations to be made on a more precise basis.