Intellectual property issues in personalised medicine

In our personalised medicine focus month, Katherine Bonter discusses the developments and challenges in personalised medicine relating to intellectual property and commercialisation.

Value chains for developing and commercializing drugs and molecular diagnostics are currently evolving, due to the disruptive scientific and technological advances that have made personalized medicine (PM) possible1. A value chain integrates value creation and encompasses the strategies and business models used by the organizations involved2. Compared to traditional pharmaceutical development value chain, the PM value chain is increasingly non-linear and requires more integration of activities across different organizations. Organizations implicated include pharmaceutical companies, diagnostic companies, hospitals and research institutes. PM has increased the diversity of roles played by these organizations and shifted their capacity to generate and contribute value.

For all organizations participating in value creation in PM, intellectual property (IP) is an important consideration. Robust IP strategies are essential for an effective value chain. However, IP strategies for molecular diagnostics (MDx) are not well established and recent U.S. patent litigation, specifically Mayo v. Prometheus Labs and Association for Molecular Pathology v. Myriad Genetics, has affected the enforceability of granted patents, best practices for claiming biomarker inventions and have significant implications for innovation in PM. The patentability of methods that relate to correlations between natural phenomenon, such as a gene variant or metabolite (a biomarker), and clinical phenotypes was considered in both Prometheus and Myriad. In March 2012, a Supreme Court decision found that the Prometheus claims, directed to methods of optimizing the dose of a drug based on measures of the level of a specific metabolite, were directed to a non-patentable law of nature. In the Myriad case, the courts considered the patentability of therapeutic screening methods, diagnostic methods and isolated DNA and cDNA molecules, related to BRCA genes associated with breast cancer. U.S. Federal Court decisions in 2011 and 2012 both found Myriad’s DNA, cDNA and therapeutic screening claims valid and their diagnostic method claims invalid. In June 2013, the U.S. Supreme Court upheld Myriad’s cDNA claims and found claims to genomic DNA as non-patentable subject matter.

“Important side issues have been raised in light of the ongoing gene patenting controversy…”

These decisions have influenced biomarker invention claiming practices. Prometheus claimed a method of detecting a drug metabolite and using a correlation between the metabolite and an effective dose to optimize the dose administered. The optimizing step was articulated as a wherein clause, in brief, wherein the level of metabolite indicates a need to increase or decrease the dose. Claiming the practical consequence of the biomarker correlation / natural phenomenon in this way was previously common practice. Currently, claims that relate to a natural correlation will need to include a specific pre-solution activity, a specific post-solution activity or both to be considered patentable3. For example, a specific way of analyzing the biomarker (pre-solution) or a specific action taken after the correlation is determined (post solution) such as a treatment step4. A study of 2,300 granted U.S. patents, directed to genotyping methods, found that: 79% are likely patent ineligible, in view of Prometheus, because the claims do not recite either a specific pre- or post-solution activity; 20% recite a specific pre-solution activity and are possibly patent eligible; 0.63% recite a specific post solution activity and are possibly patent eligible; and only 0.72% recite both a specific pre- and post-solution activity and are likely patentable5.

Important side issues have been raised in light of the ongoing gene patenting controversy including the potential impact of ‘gene patents’ on the use of whole genome sequencing. A 2005 Science article concluded that 20% of human genes are patented6. This finding was frequently cited as support for the idea that gene patents block innovation and that licensing fees needed for comprehensive gene sequencing methods would slow progress. More recently an analysis of the patents considered ‘gene patents’ in the 2005 article found that 26% of these patents did not claim a DNA molecule or genotyping method, 69% claimed a DNA molecule and 5% claimed a genotyping method7. Of the 69% that did claim a DNA molecule these were directed to primers, cDNA and vectors that would not likely be infringed by whole genome sequencing methods. Of the 5% that claimed genotyping methods these were primarily directed to sequencing methods that would not likely be infringed by next generation sequencing technologies. These data provide strong evidence that gene patents do not currently pose a threat to whole genome sequencing.

“Diagnostic tests account for only 5% of hospital costs, yet influence 60 -70% clinical decisions.”

Molecular diagnostic (MDx) tests are a key element of PM, however value capture in this area is challenging and high risk as IP strategy, regulatory approval, payor coverage and clinical adoption are unpredictable and often ill defined8. Estimating the net present value (NPV) of a test, justifying investment, can be difficult even for a test that is near to market. For example, an approved and reimbursed test can take up to 8 years for physician adoption as a result, an investment of 40 – 50 M in a MDx test that sells for 2,500 – 3,500 corresponds to a 10 year NPV range of $0 – 15 M9. Adding to this challenge, diagnostics are undervalued and typically not paid for based on clinical value like drugs. Diagnostic tests account for only 5% of hospital costs, yet influence 60 -70% clinical decisions. Rewarding the true value provided by MDx tests, and clarifying paths to and requirements for success, is necessary for investment and innovation in PM. Doing so will require the development to effective intellectual property strategies that enable alignment and integration of value creation in personalized medicine.


1. Clayton Christensen, The Innovators Prescription, A Disruptive Solution for Health Care, 2009.

2. Hansen, MT and Birkinshw, J Harvard Business Review, The Innovation Value Chain, Harvard Business Review, 2007,

3. Haanes E. et al. Stealing fire: a retrospective survey of biotech patent claims in the wake of Mayo v. Prometheus. N Biotechnology, 30, 758-60, (2012).

4. USPTO 1012 Interm Procedure for Suject Mtter Eligibility Analysis of Process Claims Involving Laws of Nature

5. Haanes E. et al. Stealing fire: a retrospective survey of biotech patent claims in the wake of Mayo v. Prometheus. N Biotechnology, 30, 758-60, (2012).

6. Jensen, K. & Murray, F. Intellectual property. Enhanced: intellectual property landscape of the human genome. Science 310, 239–240 (2005).

7. Holman, C. Debunking the myth that whole-genome sequencing infringes thousands of gene patents. Nature biotechnology 30, 240–4 (2012)

8. Keeling, P., Roth, M. & Zietlow, T. The economics of personalized medicine: commercialization as a driver of return on investment. N Biotechnol 29, 720-31 (2012).

9. Davis, J. et al. The microeconomics of personalized medicine: today’s challenge and tomorrow’s promise. Nature reviews. Drug discovery 8, 279–86 (2009).


About the author:

Katherine Bonter has worked as a Director at the Centre of Excellence in Personalized Medicine (CepMed) for the past 3 years. CepMed is a Centre of Excellence in Commercialization and Research funded by the Canadian Federal Government and industry partners. During this time, her efforts have focused on promoting the development of partnerships and projects, which can be leveraged to accelerate innovation in personalized medicine and attract funding. Prior to joining CepMed, Katherine worked for 15 years in the biopharmaceutical industry for 4 small to medium sized early stage companies, primarily in business development and intellectual property (IP). Her areas of expertise are competitive intelligence, IP portfolio management, IP strategy and personalized medicine. Currently, she is leading a 4 year GE3LS research project funded by Genome Canada as part of Large-Scale Genomics projects funded early in 2013. This project aims to systematically analyze business models, value chains, stakeholder interactions and partnering in the context of innovation in personalized medicine.

How can intellectual property issues in personalised medicine be overcome?