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Patent Baristas

The Biotechnology Industry Organization believes that fully realizing the promise of biotechnology requires a comprehensive national strategy that fine-tunes some policies and overhauls others.

BIO’s set of policy proposals address two vital needs: 1) the need to re-engineer the biotech economic model, and 2) the need to re-invent the idea-to-market pathway for biotech cures and other products.

Below is that plan:

Policies to Stimulate a Bio-based Economy

The “Bio-based Economy” refers to economic activity and jobs generated by:

  • the use and conversion of agricultural feedstocks to higher value products;
  • the use of microbes and industrial enzymes as transformation agents or for process changes; and
  • the production of bio-based products and biofuels.

The proposals below seek to elevate the concept and awareness of the bio-based economy and highlight the outstanding job creation and rural/rust belt economic development potential of industrial biotechnology and biorefinery commercialization.


Reauthorization and Enhancement of the Biomass Crop Assistance Program (BCAP)

BCAP is the key program encouraging and facilitating farmers and landowners to produce new purpose grown energy crops (PGECs) for advanced biofuels and bio­based products. Beyond reauthorizing the program through December 2017, we can further enhance it by:

  1. Ensuring funds are directed primarily to production of next generation crops for biofuels and bioenergy;
  2. Establishing a dedicated funding mechanism for awarded contracts;
  3. Providing for eligibility of non-food Title I crops; and
  4. Clarifying eligibility of certain other PGECs.

Federal Crop Insurance for Purpose Grown Energy Crops Currently, there is no formal federal crop insurance program available to producers of new PGECs. Requiring the U.S. Department of Agriculture’s Risk Management Agency to finalize its ongoing feasibility study of developing a crop insurance program for certain biofuels and bio-product feedstocks – and appropriately funding the Commodity Credit Corporation -would enable the formal establishment of such a program.

Feedstock Sustainability Enhancement Grants The continued development of domestic sources of energy, including for biofuels and renewable chemicals, depends upon the sustainable availability of consistent, high yield, good quality feedstocks. Establishing a grant program through the U.S. Departments of Agriculture and Energy would enable the funding of demonstration projects that utilize practices to enhance biofuel and bioenergy feedstock sustainability.

Codifying and Expanding the Definition of Renewable Chemicals

Many of the programs in the 2008 Farm Bill’s Title IX renewable energy programs are not available to renewable chemicals and bio-based products, despite their profound potential benefits to rural America. Codifying a more expansive definition of eligible renewable chemicals and bio-based products would enable enhanced participation of renewable energy projects in programs such as the Biorefinery Assistance Program and Rural Energy for America Program.


Tax Credit for Production of Qualifying Renewable Chemicals

Renewable chemicals and bio-based plastics represent an important technology platform for reducing reliance on foreign oil, creating green U.S. jobs, increasing energy security, and reducing greenhouse gas emissions. By providing a renewable chemicals tax credit in the form of a federal income tax credit for domestically produced renewable chemicals, Congress can create jobs and other economic activity and can help secure America’s leadership in the important arena of green chemistry. The credits would be general business credits available for a limited period per facility, and taxpayers would be subject to a competitive application and review process to ensure conformance with legislative intent.

Tax Code Reforms to Increase Availability of Advanced Biofuels and Facilitate Energy Security

Current tax law on advanced biofuels does not provide an ordered pathway toward U.S. energy security. Policymakers can help incentivize bringing commercial volumes of affordable advanced biofuels to market in the near term by amending the current tax code to:

  1. Extend the Cellulosic Biofuel Production Tax Credit through 2016 and add eligibility for algal biofuels;
  2. Allow advanced biofuel facility developers the option of electing to receive an investment tax credit;
  3. Provide for eligibility of biorefinery retrofit projects;
  4. Provide eligibility to federal Section 1603 Grants in Lieu of Tax Credits program; and
  5. Extend and expand eligibility for cellulosic biofuel property accelerated depreciation.


Strategic Biorefinery Initiative and Offtake Authority

Development of domestic sources of renewable biofuels and bio-based products would yield substantial energy security benefits. The Department of Defense is uniquely positioned to help accelerate production and deployment of these vital products through establishment of a Strategic Biorefinery Deployment Program to finance construction of the first five commercial military advanced biofuel biorefineries. Under such a program, a biorefinery “fly-off” would identify and fund construction of the most promising projects. The authority to enter into long-term (up to 15 years) offtake agreements for procurement of advanced biofuels for military use would further enhance the Department of Defense’s ability to facilitate development of domestic sources of renewable biofuels.


Repurpose and Retrofit Grant Program for Expanding Production of Advanced Biofuels

Repurposing or retrofitting existing idled or underutilized U.S. manufacturing facilities is one of the most time and cost effective ways to build out the advanced biofuels and renewable chemicals sector. Establishing a federal matching grant program through the U.S. Department of Energy to fund up to 30% of costs would facilitate investments in such repurposing and retrofitting projects while helping to rapidly expand U.S. production capacity for advanced biofuels and renewable chemicals.

Synthetic Biology for Enhanced Sustainability of Biofuels and Renewable Chemicals

The advancing field of synthetic biology has the potential to enhance greatly both the economic and environmental sustainability of fuels and chemicals manufacturing. Establishing a Synthetic Biology Research and Development Grants Program through the U.S. Department of Energy would support research that could help enable the cost-effective sustainable production of advanced biofuels, renewable chemicals and other technologies that reduce or minimize greenhouse gas emissions, including biological processes for removing carbon dioxide from the atmosphere.

Industrial Bioprocess R&D Program

The use of industrial biotechnology for the production of renewable chemicals and bio-based products is enabling dramatic improvements in industrial energy efficiency as well as a host of renewable alternatives to traditional petrochemical-based products. Establishing an Industrial Bioprocess Research and Development program through the Department of Energy would fund projects in industrial biotechnology for renewable chemicals, bio-based products, and renewable specialty chemicals.

See also:

BIO: Unleashing the Promise of Biotechnology (pt.1)
BIO: Unleashing the Promise of Biotechnology (pt.2)
BIO: Unleashing the Promise of Biotechnology (pt.4)

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When you’re networking with more than 15,000 of your closest friends at the BIO International Convention in Washington, DC, you’re bound to meet an interesting person or two.  I met more than that.

At this year’s convention, I met either the most interesting person I’ve ever met or the craziest person I’ve ever met.  Or both.  Meet Robert Cantrell of Think IP Strategy.

PB: Robert, you have been an IP Strategist, MBA, author on business and military strategy, a professional shark photographer and now a documentarian of the world’s most dangerous sharks.  Just what haven’t you done?

RC:  Hi Stephen.  I have not and probably will never go bungee jumping off a bridge.  Every risk needs to have a purpose.

PB: So, you were sitting around one day and you said, “Hey, I could make a movie about swimming with dangerous sharks.”  How did that come about and did your friends and family think this was a good idea?

RC:  This part was easy.  My friends and family are highly supportive because they have seen my still photography work with sharks and have wanted me to combine that with my writing.  They had been encouraging me to do this.

PB: Is there something about the Oceanic Whitetip Shark that made you want to swim with them in the dark?

Robert CantrellRC:  Conventional wisdom was that you do not dive with oceanic whitetip sharks at night.  Jacques Cousteau called them “The most dangerous of all sharks.”  These are the sharks that historically have shown up at open ocean disasters such as the sinking of the USS Indianapolis in 1945, made famous by the monologue of Quint (Robert Shaw) about living through the experience in the movie Jaws.

There is a famous night sequence in the 1970 shark documentary Blue Water, White Death, by Peter Gimbel, that showed multiple oceanic whitetip sharks feeding at night.  Peter’s team shot that sequence from within shark cages.  Peter said that he regretted that the team had not left the cage at night…they had been the first team to venture out during the day.  That documentary had an influence on me growing up, and this was an opportunity to answer that regret as best we could with multiple oceanic whitetip sharks at night.

PB: How long did it take to prepare for the project?

RC:  It took ten months from concept approval in August 2010 to wrapping up filming in June 2011.  Post-production is in progress now.

PB: Did you have certain expectations going into this project? Did you have anything specific in mind that you knew you wanted to include in the day you filmed?

RC:  Things happened remarkably as expected, even with challenging weather, which is a big wildcard.  I had been on site with the oceanic whitetip sharks before, so I knew what everything was going to look like and how the sharks were likely to behave.  I also knew everyone I asked to participate in the shoot – 10 people in total from camera to crew – and we had people predisposed to work well with each other and offer creative suggestions.  We had three contingencies: 1. A story line if we succeeded with the night dive.  2. A story line if the night dive did not happen.  3. An alternative tiger shark shoot if we found no oceanic whitetip sharks at all.  As it was, we shot a rather extensive storyboard plan pretty much as written, with only a few additions and deletions as new or better opportunities presented themselves.

Now, emulating movie making, we want to make sure that every clip of dialog we use, every narration, and every picture shown has a purpose to drive the story forward.  We have an overabundance of material will help us in this – many documentaries actually find themselves short of material.

PB: What is the most amazing thing you’ve learned working on All Fins On?

RC:  This shoot reinforced several strategy principles I teach in my strategy courses – and itself quite resembled the best part of small unit military planning I used to do, albeit with multiple cameras instead of weapons.  The whole planning and operation was an exercise in, piece-by-piece, reducing the uncertainties I could control so that we could focus on the uncertainties we could not control…such as whether we would find any oceanic whitetip sharks at all.  It became organized flexibility at its best.

PB: It’s clear that you have a genuine appreciation of sharks that seems to come from personal experience. What kind of animals did you grow up with, and what kind of relationship did you have with them?

RC:  We always had a family dog, and I have often had tropical fish.  Since I left college, I have been on the road too much to make keeping a dog practical, however, the fish do fine with an automatic feeder.  The more I see the wild, however, the more I regret that any animal that would not voluntarily stick around should have any confines at all…including people.

PB: Veteran nature film producer Chris Palmer wrote a book entitled Shooting In The Wild.  He takes an in-depth look at the world of wildlife filmmaking to expose the ethical dilemmas faced by filmmakers who manipulate, fabricate, and deceive – all in the name of presenting nature “realistically.” The book has been generating a fair amount of media buzz with its recounting of staged animal sequences to coax certain behaviors, use of captive animals from animal farms or zoos, and even animal abuse – all for the sake of “getting the shot.”  Did you face such dilemmas in shooting All Fins On?

RC:  I read this book just prior to the shoot.  To bring the oceanic whitetips around, we necessarily had to offer them an incentive.  While we did not feed them per say, we did put crates with fish parts in the water to provide a scent for them to investigate.  An occasional scrap would float free that they would snap up.  Given that scent, the sharks were always free to swim in, investigate us, and either stay around or leave as they chose.  One individual shark stayed with us for four days straight and participated in our night dive.

PB: As you know, this is Shark Week on the Discovery channel. Do you think these kinds of ratings boosting, shark as a scary, man-eating menace shows hinder conservation efforts? And do you watch?

RC:  Here you get to a central point of this documentary.  The easiest way to make a shark documentary to generate high ratings is to talk about one or more shark attacks, do a few interviews, recreate the scene, add a few shark clips, and done.  The second easiest is to go to tried and true shark hot spots and see whether sharks will eat this or that.  Discovery’s dilemma is that they are a commercial enterprise, and like it or not, shark conservation movies don’t sell well to the general public.  We hope to offer an alternative anchored on solid storytelling and a cinematic presentation that provides the commercially saleable tension and fear that many people want with their shark stories along with a positive message that we actually need sharks for healthy oceans and our own survival as a species.  Even a survivor of the USS Indianapolis we interviewed who lost a good friend to a shark right beside him thought that for the generations following to understand their story, they also need to see their shark.

PB: Finally, says that Shark Attack 3: Megalodon is the worse shark movie ever.  Your thoughts?

RC:  I have not seen this movie … if it went beyond Jaws 4, that is actually a cinematic accomplishment.  For anyone who does not know, Megalodon is the giant extinct predatory shark known by the hand sized fossil teeth.

I work with a literary manager/producer in California, Ken Atchity, who helped one of his clients sell another Megalodon story, Meg, optioned to Hollywood for 1 million dollars. He is co-owner and manager of the Louisiana Wave Studio where an upcoming 3D shark thriller was filmed that will no doubt pack theaters called Shark Night 3D. In contrast, a single night showing of the well-done shark conservation movie, Shark Water, in Washington D.C. attracted all of four people, including me. That is the challenge that makes this project particularly exciting and important. I don’t think it has to be an either or proposition … I believe you can succeed with sharks commercially if you offer a realistic presentation of the shark and build it around a compelling and true story. Sharks are not monsters out to get us, nor are they benevolent beings. They are just sharks. Shark Night 3D may be so over the top, then, that people can enjoy the terror of the movie without seeing it as real life … a factor in Jaws since that movie did make it all seem too real for many people.

PB: Robert, thank you so much for your time today.  Good luck with your movie.

RC:  Thank you.


Robert Cantrell has written a number of articles and papers on intellectual property.  This includes his recently published book, Outpacing the Competition: Patent-Based Business Strategy (Robert Cantrell: Wiley 2009).  This book blends patent strategy, business strategy, and classical strategy into a comprehensive whole, with the overall theme that those businesses capable of proficiently assessing their situations, deciding on courses of action, and taking action, win most competitive contests.

Several of his written works are in use at the national and service war colleges as well as in the intellectual property field to include the top selling book Understanding Sun Tzu on the Art of War.

Robert is the founder of Center For Advantage, a provider of tools for strategy, innovation, and sales workshops, training, and problem solving. He is on the faculty of Patent Resources Group, where he teaches Patent Strategy for Business. And he was last seen developing a cure for cancer.

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The Biotechnology Industry Organization believes that fully realizing the promise of biotechnology requires a comprehensive national strategy that fine-tunes some policies and overhauls others.

BIO’s set of policy proposals address two vital needs:

1) the need to re-engineer the biotech economic model, and
2) the need to re-invent the idea-to-market pathway for biotech cures and other products.

Below is that plan:

Small Business Tax Incentives

Removing Financing Restrictions: Section 382 Net Operating Loss Reform

Section 382 of the Internal Revenue Code restricts the usage of net operating losses by companies that have undergone an “ownership change.” However, small biotech companies are unintentionally caught in its scope due to their reliance on outside financing and investment deals. Exempting net operating losses generated by qualifying research and development by a small business from Section 382 and redefining “ownership change” to exclude certain qualified investments (like those in rounds of venture financing) would enable small biotech companies to increase their value when preparing for mergers or initial public offerings.

Nearly a third of small U.S. biotech companies
have been approached to move their R&D
offshore, and CEOs named China
and India as two prime destinations.

Source: Therapeutic Discovery Project Post-Award Survey.
Penn Schoen Berland, prepared for BIO.

Incentives for Non-Investor Capital

Increasing R&D Investment: Tax Holiday on Repatriated Investments in Small Biotechs Many small biotechnology companies rely on collaborations with large multi-national corporations to fund their research and development. A repatriation tax holiday on funds brought back to the United States from abroad would incentivize these large companies to repatriate earnings they are holding overseas and give them the ability to invest in and collaborate with small biotechs conducting groundbreaking research here at home.

Rewarding Innovative R&D Businesses: U.S. Innovation Box

Many Western European countries have implemented reduced corporate tax rates on income stemming from certain types of intellectual property. Allowing for a reduced corporate rate on this type of income would make investment in U.S. biotechnology more attractive and competitive, and would provide innovative companies with a greater return on their R&D expenses — allowing them to undertake more research projects here in the United States.

Most big pharmaceutical companies have
significant cuts to research and
development activities.

Source: Reuters: “Analysis: Big Pharma strips down
broken R&D engine,” 11 May 2011.

Supporting Industry Collaborations: Section 197 Amortization Reform

Small biotechs typically have intangible assets that are amortizable under Section 197 of the Internal Revenue Code. Reforming that law to provide for faster cost recovery for intangible assets acquired by investors would encourage large company investors to invest at an earlier stage in small biotech companies’ research.


BIO: Unleashing the Promise of Biotechnology (pt.1)
BIO: Unleashing the Promise of Biotechnology (pt.3)
BIO: Unleashing the Promise of Biotechnology (pt.4)

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Despite the urgent need for scientific breakthroughs in biotechnology, current government policies are holding back the potential and promise of the scientific potential that resides in the thousands of biotech companies.

The Biotechnology Industry Organization had looked at the changes to our policy environment that would incentivizes companies to develop the breakthrough cures, treatments, enhanced agricultural products, vaccines and biofuels.
BIO notes that biotech research and development is a particularly high-risk undertaking because of the substantial start-up costs, lengthy experimentation period, and possibility that the technology will not prove viable.

BIO believes that fully realizing the promise of biotechnology requires a comprehensive national strategy that fine-tunes some policies and overhauls others.

BIO’s set of policy proposals address two vital needs for ensuring biotechnology innovation and industry growth:

1) the need to re-engineer the biotech economic model, and

2) the need to re-invent the idea-to-market pathway for biotech cures and other products.

Below is that plan:

I. Promoting Investment in Innovation

Congress has historically provided tax incentives to high-risk endeavors (such as oil and gas exploration, alternative energy, and high-tech start-ups) as a means for encouraging new investment. However, current tax law does not do enough to foster investment in health care, green technology, or energy-focused biotechnology companies. Given the economic and societal benefits of ensuring a robust biotech industry in the United States, it is imperative that Congress and the Administration adopt policies that recognize the unique financial structure and capital needs of biotech companies.

Features Of The Typical Biotech Company
• Unprofitable—3 or more years away from having product revenue
• Private company (70% of the biotech industry is private)
• Fewer than 50 employees
• Completed one round of venture capital financing

The proposals are designed to incentivize investors, strengthen small business, and promote innovation.

Small Business Investor Incentives

Incentivizing Small Biotech Investment: Angel Investor Tax Credit

Modeled after numerous state programs, a federal Angel Investor Tax Credit would provide an incentive for individuals to invest in emerging biotech companies researching innovative technologies. To be eligible, investors would have to invest in a company with fewer than 500 employees performing qualifying research. The credit would be equal to 50% of their investment.

Worldwide, 35% of pharmaceutical companies
outsourced projects to Asia in 2009, with
China and India the top two destinations.
Source: “Annual Outsourcing Survey,” Contract Pharma (2009)

Stimulating Private Capital for Biotechnology: R&D Partnership Structures

Due to the lengthy drug development process, small biotechnology companies often have difficulty obtaining early-stage financing for their research and development and, because they are not yet profitable, are unable to immediately use their tax assets (i.e., tax credits and losses) to offset income. The development of new partnership structures that allow a biotech company’s investors to offset their income with the company’s tax assets would significantly stimulate much needed private investment in biotechnology.

Improving Capital Gains Treatment for Small Businesses: Section 1202 Reform

Section 1202 of the Internal Revenue Code provides for a reduced capital gains rate for qualified investments in certain small business stock. However, due to the valuable intellectual property and successive rounds of financing inherent in biotech innovation, biotech companies do not meet the definition of qualified small businesses under Section 1202. Modifications to the small business definition and other changes in Section 1202 would encourage investment in research performed by capital-intensive, small biotech companies.

In India, the Biotech Industry Partnership
program provides grants and soft loans to
companies conducting high-risk research, which
has fostered a 20% annual growth rate.
Source: Global Biotechnology Report 2008, Ernst & Young

Doubling Private Funding: Matching Grants for Investments in Start-Ups

A small business early-stage investment program would provide matching grants to venture capitalists that specialize in funding small, innovative companies. The government grants would match investments in targeted small businesses, including emerging biotech companies, essentially doubling their financing by enabling seed financing to spur further investment.

Venture Capital Investing In Biotech Has Declined and Remains Largely Stagnant
• According to Pricewaterhouse Coopers, the first quarter of 2011 marked
the fewest biotech venture deals of any quarter since 2003.
• The average deal for the first round of funding in the first quarter of 2011
was $2.2 million, the smallest average size for such deals since 2005.
• In 2007, U.S. biotech companies raised $5.2 billion in venture financing.
In 2010, the industry raised just $3.7 billion in venture capital, 30% less than 2007’s total.
• The troubled IPO market and financial crisis have contributed to
the reduced size of the United States biotech industry.
The number of public biotech companies in the U.S. has decreased by 25% since January of 2008.


BIO: Unleashing the Promise of Biotechnology (pt.2)
BIO: Unleashing the Promise of Biotechnology (pt.3)
BIO: Unleashing the Promise of Biotechnology (pt.4)

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In a 2-1 decision, the Federal Circuit upheld that companies can patent genes but decided that they cannot patent methods to compare the gene sequences.

The Federal Circuit handed down a decision on the Myriad Genetics appeal from the decision of the US District Court holding that a gaggle of medical organizations, researchers, genetic counselors, and patients have standing to challenge Myriad’s patents. See:  Assoc. for Molecular Pathology v. U.S. Patent & Trademark Office, 669 F. Supp. 2d 365 (S.D.N.Y. 2009). Myriad also appealed the district court’s decision granting summary judgment that all of the challenged claims are drawn to non-patentable subject matter under 35 U.S.C. § 101.

  1. On the issue of jurisdiction, the Federal Circuit concluded that at least one plaintiff, Dr. Harry Ostrer, has standing to challenge the validity of Myriad’s patents.
  2. On the merits, the Federal Circuit reversed the district court’s decision that Myriad’s composition claims to “isolated” DNA molecules cover patent-ineligible products of nature under § 101 since the molecules as claimed do not exist in nature.
  3. The Federal Circuit also reversed the district court’s decision that Myriad’s method claim to screening potential cancer therapeutics via changes in cell growth rates is directed to a patent-ineligible scientific principle.
  4. The Federal Circuit did, however, affirm the court’s decision that Myriad’s method claims directed to “comparing” or “analyzing” DNA sequences are patent ineligible; such claims include no transformative steps and cover only patent-ineligible abstract, mental steps.

Association For Molecular Pathology v. US Patent And Trademark Office and Myriad Genetics

This whole brouhaha has to do with U.S. Patent Nos. 5,747,282; 5,837,492; 5,693,473; 5,709,999; 5,710,001; 5,753,441; 6,033,857.

The composition claims cover two “isolated” human genes, BRCA1 and BRCA2 and certain mutations in these genes associated with a predisposition to breast and ovarian cancers. Representative composition claims include claims 1, 2, and 5 of the ’282 patent:

1.  An isolated DNA coding for a BRCA1 polypeptide, said polypeptide having the amino acid sequence set forth in SEQ ID NO:2.

2.  The isolated DNA of claim 1, wherein said DNA has the nucleotide sequence set forth in SEQ ID NO:1.

5.  An isolated DNA having at least 15 nucleotides of the DNA of claim 1.

SEQ ID NO:2 depicts the amino acid sequence of the BRCA1 protein, and SEQ ID NO: 1 depicts the nucleotide sequence of the BRCA1 DNA coding region.

All but one of the challenged method claims cover methods of “analyzing” or “comparing” a patient’s BRCA sequence with the normal, or wild-type, sequence to identify the presence of cancer-predisposing mutations. Representative method claims include claim 1 of the ’999:

1. A method for detecting a germline alteration in a BRCA1 gene, said alteration selected from the group consisting of the alterations set forth in Tables 12A, 14, 18 or 19 in a human which comprises analyzing a sequence of a BRCA1 gene or BRCA1 RNA from a human sample or analyzing a sequence of BRCA1 cDNA made from mRNA from said human sample with the proviso that said germline alteration is not a deletion of 4 nucleotides corresponding to base numbers 4184-4187 of SEQ ID NO:1.

The final method claim challenged by Plaintiffs is directed to a method of screening potential cancer therapeutics. Specifically, claim 20 of the ’282 patent reads as follows:

20. A method for screening potential cancer therapeutics which comprises: growing a transformed eukaryotic host cell containing an altered BRCA1 gene causing cancer in the presence of a compound suspected of being a cancer therapeutic, growing said transformed eukaryotic host cell in the absence of said compound, determining the rate of growth of said host cell in the presence of said compound and the rate of growth of said host cell in the absence of said compound and comparing the growth rate of said host cells, wherein a slower rate of growth of said host cell in the presence of said compound is indicative of a cancer therapeutic.

The challenged claims relate to isolated gene sequences and diagnostic methods of identifying mutations in these sequences.

Declaratory Judgment Jurisdiction

The first question addressed was whether the district court correctly exercised declaratory judgment jurisdiction over this suit:

Although no bright-line rule exists for determining whether a declaratory judgment action satisfies Article III’s case-or-controversy requirement, the Supreme Court has held that the dispute must be “definite and concrete, touching the legal relations of parties having adverse legal interests,” “real and substantial,” and “admi[t] of specific relief through a decree of a conclusive character, as distinguished from an opinion advising what the law would be upon a hypothetical state of facts.” MedImmune, 549 U.S. at 127 (quoting Aetna Life, 300 U.S. at 240-41). “Basically, the question in each case is whether the facts alleged, under all the circumstances, show that there is a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.”

Myriad challenged jurisdiction on the grounds that Myriad and the Plaintiffs do not have adverse legal interests and that Plaintiffs failed to allege a controversy of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.

The Plaintiffs responded that they have standing because, not only are they undisputedly prepared to immediately undertake potentially infringing activities, but also Myriad took sufficient affirmative acts with respect to the patents in suit. Regarding the latter, the Plaintiffs cried that Myriad sued, threatened to sue, or demanded license agreements from every known institution offering BRCA clinical testing, including university labs directed by plaintiffs Kazazian, Ganguly, and Ostrer.

Under the facts alleged in this case, we conclude that one Plaintiff, Dr. Ostrer, has established standing to maintain this declaratory judgment suit. All Plaintiffs claim standing under the Declaratory Judgment Act based on the same alleged injury: that they cannot undertake the BRCA-related activities that they desire because of Myriad’s enforcement of its patent rights covering BRCA1/2.3 Only three plaintiffs, however, allege an injury traceable to Myriad; only Drs. Kazazian, Ganguly, and Ostrer allege affirmative patent enforcement actions directed at them by Myriad. Of these three, Dr. Ostrer clearly alleges a sufficiently real and imminent injury because he alleges an intention to actually and immediately engage in allegedly infringing BRCA-related activities.

The court said that Dr. Ostrer could have proceeded with his BRCA-related clinical activities without taking a license from Myriad because he thinks that the patents are invalid since  genes are patent ineligible products of nature. This put Myriad and Dr. Ostrer in adverse legal positions regarding whether or not Ostrer can engage in BRCA genetic testing without infringing any valid claim to “isolated” BRCA DNAs or methods of “analyzing” or “comparing” BRCA sequences, as recited in Myriad’s patents.

 The Supreme Court has required only that it is “likely,” rather than “merely ‘speculative,’” that the alleged injury will be “redressed by a favorable decision.” Lujan, 504 U.S. at 561. The Court has not required certainty.

Patentable Subject Matter

Under the Patent Act, “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.” 35 U.S.C. § 101.

The Supreme Court has consistently construed § 101 broadly, explaining that “[i]n choosing such expansive terms . . . modified by the comprehensive ‘any,’ Congress plainly contemplated that the patent laws would be given wide scope.” Bilski v. Kappos, 130 S. Ct. 3218, 3225 (2010) (quoting Chakrabarty, 447 U.S. at 308).

Supreme Court  precedents provide three judicially created exceptions to § 101’s broad patent-eligibility principles: “laws of nature, physical phenomena, and abstract ideas.”

Here, the Plaintiffs challenge Myriad’s composition claims directed to “isolated” DNA molecules and method claims directed to “analyzing” or “comparing” DNA sequences under § 101.

Composition Claims: Isolated DNA Molecules

Myriad argued that the district court found the claims unpatentable by (1) misreading Supreme Court precedent as excluding from patent eligibility all “products of nature” unless “markedly different” from naturally occurring ones; and (2) incorrectly focusing not on the differences between isolated and native DNAs, but on one similarity: their informational content.

Myriad argued that an isolated DNA molecule is patent eligible because it is, as claimed, “a nonnaturally occurring composition of matter” with “a distinctive name, character, and use.”

The Plaintiffs argued that claims to isolated DNA molecules fail to satisfy § 101 because such claims cover natural phenomena and products of nature. The Plaintiffs assert that to be patent eligible a composition of matter must also have a distinctive name, character, and use, making it “markedly different” from the natural product.

In sum, although the parties and the government appear to agree that isolated DNAs are compositions of matter, they disagree on whether and to what degree such molecules fall within the exception for products of nature. As set forth below, we conclude that the challenged claims to isolated DNAs, whether limited to cDNAs or not, are directed to patent-eligible subject matter under § 101.

Because isolated DNAs, not just cDNAs, have a markedly different chemical structure compared to native DNAs, we reject the government’s proposed “magic microscope” test, as it misunderstands the difference between science and invention and fails to take into account the existence of molecules as separate chemical entities.

Method Claims

The district court’s decision predated the Supreme Court’s decision in Bilski, which rejected this court’s machine-or-transformation test as the exclusive test for determining whether an invention is a patent-eligible process under§ 101, although the test remains “a useful and important clue.”

Methods of “Comparing” or “Analyzing” Sequences

Myriad argued that its claims to methods of “comparing” or “analyzing” BRCA sequences satisfy the machine-or-transformation test as applied in Prometheus because each requires a transformation–extracting and sequencing DNA molecules from a human sample–before the sequences can be compared or analyzed.

The Plaintiffs argued that these method claims are drawn to the abstract idea of comparing one sequence to a reference sequence and preempt a phenomenon of nature–the correlation of genetic mutations with a predisposition to cancer.

We conclude that Myriad’s claims to “comparing” or “analyzing” two gene sequences fall outside the scope of § 101 because they claim only abstract mental processes. The claims recite, for example, a “method for screening a tumor sample,” by “comparing” a first BRCA1 sequence from a tumor sample and a second BRCA1 sequence from a non-tumor sample, wherein a difference in sequence indicates an alteration in the tumor sample.

This claim thus recites nothing more than the abstract mental steps necessary to compare two different nucleotide sequences: look at the first position in a first sequence; determine the nucleotide sequence at that first position; look at the first position in a second sequence; determine the nucleotide sequence at that first position; determine if the nucleotide at the first position in the first sequence and the first position in the second sequence are the same or different, wherein the latter indicates an alternation; and repeat for the next position.

Method of Screening Potential Cancer Therapeutics

The Plaintiffs challenged Myriad’s method claim directed to a method for screening potential cancer therapeutics via changes in cell growth rates as directed to the abstract idea of comparing the growth rates of two cell populations and as preempting a basic scientific principle — that a slower growth rate in the presence of a potential therapeutic compound suggests that the compound is a cancer therapeutic.

The Federal Circuit disagreed:

Starting with the machine-or-transformation test, we conclude that the claim includes transformative steps, an “important clue” that it is drawn to a patent-eligible process. Bilski, 130 S. Ct. at 3227. Specifically, the claim recites a method that comprises the steps of (1) “growing” host cells transformed with an altered BRCA1 gene in the presence or absence of a potential cancer therapeutic, (2) “determining” the growth rate of the host cells with or without the potential therapeutic, and (3) “comparing” the growth rate of the host cells. The claim thus includes more than the abstract mental step of looking at two numbers and “comparing” two host cells’ growth rates.


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Welcome to another Blawg Review, hosted this week by the Patent Baristas.  We’re always glad to have people over to visit so grab a cup of joe and we’ll see what’s been going on around the blogosphere.

It’s the Dog Days of Summer, the name for the most sultry period of summer from about July 3 to Aug. 11. As is typical here, it’s currently a sultry 95 degrees in beautiful, downtown Cincinnati, Ohio, with the humidity hovering somewhere near steam bath.  Bear with us if we sometimes seem incoherent due to the heat.

This week we celebrate the slow life that comes with scorching weather.  So, unload a few burdens, give yourself the luxury of slowing down and looking for that elusive cooling breeze.

Keep It Simple, Real Simple.

“Keep It Simple”

Y’all know it’s crazy
Drivin’ me insane
I don’t wanna be a superman
I just wanna’ go somewhere and use my hands And keep it simple, real simple

~Keb’ Mo’

Keep It Simple - Keb' Mo'

Without further ado, here is this week’s review, in no particular order:


Proving You Wrong

Scott Greenfield, over at Simple Justice, writes about the felonization of just about everything.  Eddie Leroy Anderson, 68, and his son each plead guilty to a misdemeanor and got a year’s probation and a $1,500 penalty after trying to dig for arrowheads near a favorite campground of theirs (they didn’t actually find any).  Unfortunately, they were on federal land and the Archaeological Resources Protection Act of 1979, doesn’t require criminal intent and makes it a felony punishable by up to two years in prison to attempt to take artifacts off federal land without a permit.  Harvey Silverglate, notorious civil rights lawyer, says we commit three felonies a day, If you don’t believe it, see the Wall Street Journal.

wiredGC has a post by John Wallbillich on 7 Rules in a series about Zen and the Art of Legal Pricing for those who are value-billing and want the quickest bang for the buck.

Gene Quinn at IP Watchdog laments the problem of the patent troll — one who is abusing the patent right by pressing specious claims in order to shake down a defendant for payment.’s Legal Blog Watch longs for when flight plans were simpler and continued its series of Things You Can’t Do on a Plane (vol. 4).

Simple Justice ponders Kevin O’Keefe’s view of the inevitable, unconditional surrender to social media as our Overlord  Kevin says: “You’re going to lose lawyers and other professionals to competitors. Per a study by American Express, 39 percent of younger workers won’t even consider working for a company that blocks Facebook. Facebook has become the communication tool of choice for many young professionals.”


 Let Your Light Shine

Mark Bennett, at Defending People, gives a detailed and thoughtful response to the Department of Education’s “Dear Colleague Letter” stating that, under Title IX, “a school’s grievance procedures must use the preponderance of the evidence standard to resolve complaints of sex discrimination.” Sex discrimination, says the DOE, includes sexual violence.

The Volokh Conspiracy outlines the case of a woman being prosecuted for displaying plastic testicles on her car because South Carolina bans obscene or indecent bumper stickers and similar “device[s].”

zen habits points out that it is fairly simple how you can make a living doing something you’re passionate about.  Do one thing really well.  It’s really that simple. Narrow down what you do, and do it repeatedly. Learn, grow, improve, read, watch, do it some more. When you’re really good at that one thing, people will want to pay you for it, or to learn how you do it.

The Blawg Review editor is passionate about down-sizing.  mnmlist shares that when we start out with something, we usually will try everything. But as we learn, we can pare down ideas that we find out don’t matter.  We’re left with the essentials.

Head of Legal points out that the Culture, Media and Sport select committee will not be able to compel answers from Rupert and James Murdoch and Rebekah Brooks. In a sense, no one can ever compel anyone to answer questions – even by the use of torture (a power not even Parliament claims for itself). The real question is, what sanctions will you take against a silent witness?


One Friend

The UK law blog Charon QC shows us that that 70% of the population in Britain would welcome a return of the death penalty – the argument of the ‘executioneers’ is that Parliament must impose the will of the majority.  To that, Charon simply says “5 million flies eat shit, but it does not follow that shit is good for us to eat” .

Dennis Crouch at Patently-O notes that over the past year-and-a-half, 52 utility patents have issued that each cite more than 2,500 references.  It turns out that the vast majority of those patents are owned by one company –  Personalized Media Communications. PMC needs to learn to simplify.

Jackie Wright Bonilla writes on the Personalized Medicine Bulletin that the Federal Circuit decided the “ACLU/Myriad” gene patenting case, formally known as Assn. Molec. Path. et al. v. USPTO et al.  In a majority opinion by Judge Lourie, the court addressed the case on the merits, after finding that at least one plaintiff — out of a cast of thousands — had standing to sue.

Patent Docs‘ Kevin Noonan talks about the latest case in which the Federal Circuit assessed the scope of foreseeability for rebutting prosecution history estoppel, Duramed Pharmaceuticals, Inc. v. Paddock Laboratories, Inc., followed a trend started in Festo X and applied in several other doctrine of equivalents decisions by the Federal Circuit in the nine years since the Supreme Court established foreseeability as a basis for rebutting the presumption of prosecution history estoppel.

IPKat Jeremy Phillips walks us through the laborious court dealings of the Star Wars copyright litigation brought  by Lucasfilm Ltd, Star Wars Production Ltd and Lucasfilm Entertainment Co Ltd against the evil empire consisting of the man who produced military uniforms for the Star Wars movie and the company he owned.

Seattle Copyright Watch likewise has a very detailed account of the Lucasfilm case and the right to keep others from making vacuum-molded plastic Stormtrooper helmets.  Apparently, the defendant made versions of the Imperial Stormtrooper helmet and armor, some of which he sold in the U.S. at a price of between $8,000 and $30,000.

Walk Back In

In the legal credit crunch, babybarista wonders if various solicitors’ firms could begin selling off their future earnings to loan sharks.

Hugh McLeod, guest post on Copyblogger, thinks It’s the Simplicity, Stupid.  Make it easy  One thing he’s learned:  “I cannot make my subscriber list tell their friends about the newsletter, no matter how hard I try to apply my Jedi mind tricks.  All I can do is make it easy for them to share. All I can do is make it as friction-free as possible.”

HR Ninja Todd Bavol suggests keeping it simple when creating job titles in recruiting ads.   When a UK company advertised for a “nail technician”, not surprisingly the employer found himself wading through dozens of applications from beauticians when what they were actually seeking was someone to sort nails (the metal variety!) on a building site.

The WSJ Law Blog gives some social media advice in Tweeting for Lawyers 101.  A good rule of thumb for attorneys is that “if you can’t do it off-line, you can’t do it online.” says that the next time you find yourself struggling to get things done, or taking too long to accomplish menial tasks, attack your distractions to simplify things and increase productivity.  “I have not seen anyone effectively simultaneously use a laptop and a desktop, or a desktop and a iPad. If your desk is cluttered with four different pieces of technology, your mind will be just as cluttered.”

The Gender & Sexuality Law Blog notes that at the same time that “being tough on rape” seems a losing strategy for many prosecutors, they can’t be tough enough on human trafficking.


I’m Amazing

gapigvoid‘s Hugh Macleod writes about simpler times while watching Neil Armstrong stepping down the ladder of lunar landing module.  “Watching that one small step on the static-ky, shaky black and white TV, with the tinfoil on the antenna to get a slightly better reception, I realized I had been inspired in small ways to live a life that would always push against the limits of my own fears.”

Eric Turkewitz of the New York Personal Injury Law Blog writes about Watching a massive Saturn V rocket blast off to the moon can leave quite an impression on an 11-year-old.  “I think about that now as kids of the same age as I was back then are getting cell phones and iPads, texting, sexting, twittering and facebooking. Friends are now some type of amorphous concept as we live in the age of information overload.”

An Associate’s Mind thinks about how integrity is not that popular of word in the 21st century.  “Look at the general mess available on TV: reality shows, celebrity divorces, and back-stabbing politicians. Integrity has seemingly faded from the daily lexicon. But for anyone looking to develop a reputation that matters, integrity is essential.”

The Men’s Divorce Blog writes about the fatherhood-gap. The marriage-gap works as follows: couples who are wealthier and better educated tend to marry later, and stay married longer. Couples who have less education and less professional success tend to not marry and to divorce more often. Because a fragmented family is more expensive to maintain than an intact one, they tend to then get poorer still. The married thus end up much wealthier than the unmarried and the gap between them is getting wider.  The “Fatherhood-gap,” is a similar gap where Fathers from intact families are spending more time with their kids than their own fathers did. So those who have dads in the home are getting more time with those dads. Thus the gap in actual fathering time between those whose fathers live with them and those whose fathers don’t is getting wider.

With the Blawg Review editor heading to Greece soon it seems only natural to mention Koehler Law’s reminiscing about drinking Ouzo in Greece.  “There, behind the door, was a vat that must have been three feet tall.  When either Ouzo bottle was empty, the owner brought it back to the kitchen and re-filled it with the cheapest stuff he could buy.”

The Time Blawg educates us about the various forms of law blogging, including the ‘flawger’ — someone who flawgs (A legal blog without any substantive legal content that is created, monetized and promoted exclusively for profit.). Usually, a non-lawyer/social media law marketer, (but also a disbarred/suspended/unemployed/underemployed/retired/or failed lawyer who quit) who writes blawg posts about how to write blawg posts, SEO, ROI, iPads, cloud computing, top ten lists, and enjoys attending law marketing conferences and twittering about using #hashtags.


Prosperity Blues

In a a guest post by Michael Samsel, SimplyForties has a thing or 2 to say about office chairs.  “Sitting and working, hours on end, staring at the monitor, while minding the mouse and keyboard.  As this has come to define the workaday world, office furniture manufacturers seized the opportunity, quite effectively I might add, to fill the void… offering you comfort and ergonomic correctness… in such a cool way as to become fashion. ”

At the SPC Blog, Jeremy Phillips explains why Brazil should be the next country to be included in the Bucknell Book, the new Oxford University Press publication, Pharmaceutical, Biotechnology and Chemical Inventions: World Protection and Exploitation, a massive two-volume work covering no fewer than 12 jurisdictions which is edited by Duncan Bucknell (for details click here).

Jeremy also looks at pharmaceutical repackaging cases in which one case holds never mind the technicalities as to whose name appears on the packaging — look at the reality. The trade mark owner’s interest in preserving the integrity of its trade marks is unaffected and the consumer is not threatened or misled,  End of story.

If you’re passionate about downsizing but need a fixed address, you may consider the ”Keret House‘ the thinnest house in the world that will be built predominantly using a steel frame, plywood, and Styrofoam.

Think IP Strategy’s weekly selection of top Pharma & Biotech intellectual property news breaking in the blogosphere and internet includes corporate self-interest and strategic choices: Gilead licenses to Medicines Patent Pool (IP Watch) (KEI).

Spicy IP notes that the Indian Patent Act bars patents on traditional knowledge (TK), stated in very broad terms that any invention based on TK is not patentable. It appears to suggest that no patent shall be granted even if the patent application happens to be from the community owning the TK in question.

Dice noted that the law firm Proskauer has equipped more than 500 of its 700 attorneys with iPad 2’s. “At law firms, the technology spend ranks as the third-largest line item behind people and office space. Its place on the budget sheet, though, is well justified: Lawyers rely heavily on computers to deliver services that are at the core of a law firm’s business. All of this underscores the huge risk Proskauer took to adopt the newfangled iPad as a lawyer’s go-to computer.”

At Centsational Girl, Courtney Lake gives his monthly contribution on the topic of how to stage a simple and stylish brunch for your friends and family.


Keep It Simple

Profit and Laws shows why more lawyers don’t write books that try to explain the world of law to the rest of the world. And why writing it was such a challenge and why debating it is so delightful. Because law is complex and consequential and fascinating. Hard as you try to summarize and simplify, nuance gets lost in clarity. Lawyers love nuance and distrust clarity.

The EPO blog writes about the EPO’s invitation for an informal meeting with the heads of the US and Japanese Patent Offices to explore possible ways of moving towards international patent law harmonization.

Alan’s blog discusses John Maeda’s book, “The Laws of Simplicty,” which includes many gems not least those arising from Maeda’s roots in Japanese design culture, including aichaku, the “sense of attachment one can feel for an artifact” (p.69) and omakase meaning “I leave it to you”, which asks the sushi chef to create a meal especially for you (p.76).

China Law Blog discusses what you should be reading on China politics, China travel, China food, China this and China that. The quick answer is to look at the CLB blogroll.  But that’s not all.  “Just today I realized how much I enjoy and for how long I have enjoyed the Beijing Daze blog, and yet I have not once mentioned it on this blog.  Until now. Beijing Daze describes itself as “ramblings and comments about Beijing Live Music Scene, Chinese Restaurants in Beijing as well as any weird and quirky cultural ditties that i might come across!” It is heavily skewed toward Beijing’s music scene.

Legal Rebels Patrick Lamb thinks some law firm leaders are hitting a mental wall when confronted with a chance to change.  Lamb compares the situation with the Discovery Channel’s new show “Surviving the Cut.”  The shows have tracked the training of Navy Seals, Green Berets, Army Rangers and other elite units. The training is designed to separate the über-elite from the mere elite. Some who do not make it are interviewed, and almost to a person, they describe the feeling of “hitting the wall” and being able to go no further. For some, the wall is physical. For many, it is mental.  Is there a similar wall in law firms?

Next week, the ABA Journal is hosting Blawg Review #314. Blog plugs the 2011 ABA Annual Meeting and is headed to the world-class city of Toronto this summer!  The Section of Intellectual Property Law will feature an international panel examining recent actions on ACTA.

We hope you’ve enjoyed this week’s edition of Blawg Review. Nothing herein should be construed as an endorsement of any product or service. The decision on any inclusion (or not) in the review was completely arbitrary and capricious. Past performance does not guarantee future returns.

Thanks for dropping by and visiting our place. We’ll meet at your place next time.  And we won’t ask you to wear a swimsuit.

Blawg Review has information about next week’s host, and instructions how to get your blawg posts reviewed in upcoming issues.

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The effervescent Blawg Review Editor has asked Patent Baristas to host the next Blawg Review .  Having to follow the last review with the theme Nelson Mandela Day, everything I say will seem slightly more trite.

In the interest of God, Country and mercy, please send me your suggested additions to Blawg Review #313, which will be held next Monday.  Keep in mind that this week’s blog theme is “Keep It Simple”  so it would be helpful to have additional suggestions that continue that thread.

Send in your submissions via the submissions and recommended posts button: Blog Carnival submission form - blawg review

Or just send an email addressed in standard form to: post at blawgreview dot com

Submit your own best post or a recent law blog post that you would like to recommend for consideration by the host of the next issue of Blawg Review.  I’d especially like to hear from/about sites that are not perennials on Blawg Review.

Deadline for submissions shall be 11:59 p.m. Pacific Time on Saturdays for publication on Mondays.

Your email should include this info about your submission:

Email Subject Line: Blawg Review

Blawg Title:

Blawg URL:

Post Headline:

Permanent link to the post:

Trackback, if any:

Your Name: Legal Name, Username, Nickname, or Pseudonym

Description or Excerpt: *


*  It helps the host, sometimes, to know upfront how the writer would present the submission. The host shall be at liberty to present the submission, or not, or make another presentation of the post as seems appropriate to the host for that Blawg Review, with unfettered discretion.

I think we shall now go and enjoy a simple cup of tea whilst we ponder our task ahead.

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The Sherley v. Sebelius lawsuit challenging U.S. funding for human embryonic stem-cell studies was dismissed by a federal judge after an appeals court found the government-backed research is probably lawful.

U.S. District Judge Royce Lamberth, chief of the federal court in Washington, last year said the lawsuit was likely to succeed and ordered a stop to the research while the case was pending. But, the injunction was yanked by the U.S. Circuit Court of Appeals who thought the case was likely to fail.

The original suit was brought by two doctors who sought to block the U.S. Health and Human Services Department and the National Institutes of Health from spending federal funds on research involving human embryonic stem-cells.  The plaintiffs in this case, Dr. Sherley and Dr. Deisher, are scientists who conduct research using only adult stem cells. They assert that the NIH violated the Dickey-Wicker Amendment by funding ESC research projects.

Lamberth last year temporarily barred the government from funding the research, finding it probably violated the so-called Dickey-Wicker Amendment. The 1996 law bars government spending on research that damages or destroys a human embryo. Now, the United States Court of Appeals for the District of Columbia overruled, by 2-1, the district court judge’s preliminary injunction on federal funding of research using embryonic stem cells (ESCs).

The Dickey-Wicker Amendment is an appropriations rider that bars the NIH from funding:

  1. The creation of a human embryo or embryos for research purposes; or
  2. research in which a human embryo or embryos are destroyed, discarded, or knowingly subjected to risk of injury or death greater than that allowed for research on fetuses in utero under 45 C.F.R. 46.204(b) and section 498(b) of the Public Health Service Act (42 U.S.C. 289g(b)).

The court’s analysis turned on the ambiguity of the Dickey-Wicker Amendment, specifically, a lack of definition for the word “research.” The court determined that the present tense of the Amendment, with no reference to embryos that “were destroyed,” implied that the Amendment did not ban ESC research on stem cell lines in existence at the time of the Amendments enactment.

Judge Ginsburg also pointed out that Congress has continued to leave the Dickey-Wicker Amendment unchanged every year since 1996 even though Congress has had “full knowledge” that the Department of Health and Human Services has been funding ESC research since 2001.

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