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The Myriad Strategy

Prof. Doug Lichtman, UCLA School of Law
November 27, 2012

In recent years, courts have struggled with the question of exactly what types of inventions should be eligible for patent protection.  On the one hand, judges consider it inappropriate to allow any single patent holder to control something so broad as a fundamental law of science, or something so fundamental as a newly discovered product of nature.  Newton, the courts remind us, was not entitled to an exclusive right over the concept of gravity, nor was Einstein given control over his recognition that E=mc2.  On the other hand, courts and the patent system also want to encourage fundamental research.  Medical care, the courts recognize, would take substantial steps forward were scientists funded at a level that would enable a more complete mapping of the human genome.  Efforts to develop alternative energy sources would similarly see a boost were basic achievements in that category more fully welcomed into the patent regime.

The legal issues here continue to play out, with major cases today still looming at the trial court, appellate, and Supreme Court levels.  In this column, however, instead of thinking about those cases directly, I want to think instead about how patent holders are responding to these uncertainties by adopting a strategy of redundant, complementary patenting.

The Safety Net

Consider, for example, the genetic engineer who, in 1972, created a type of bacterium that was useful for breaking down spilled oil.  The researcher was unsure as to whether the patent system would allow a patent on a man-made but living creature.  So, instead of putting all of his eggs in that one controversial basket, he patented his invention from a variety of perspectives.  He patented his new bacterium explicitly.  He also patented the method of producing that new bacterium.  And he patented the strategy of dropping something like straw onto an oil spill, releasing the new bacterium onto the straw, and then giving the bacterium time to float with and gradually consume the oil.

By patenting these complementary articulations of his invention, the researcher protected himself from a bad patent outcome.  If the patent on the bacterium itself were upheld, the inventor would have a lock on the central aspect of his innovative oil clean-up strategy.  If that patent were struck down, however, the researcher would still have substantial leverage, in that he would still own the best (and possibly only) way to make the bacterium, and he would similarly have exclusive rights in the big-picture strategy that made the bacterium economically valuable in the first place.

Fast forward to current times, and the company Myriad Genetics is wisely taking this same approach.  Myriad is the firm that offers for sale a test that screens patients for a particular genetic defect that in turn has been associated with an increased risk of breast cancer.  Myriad at the moment has patents on the very association that is the foundation of its test: the idea that this particular genetic defect is associated with an increased likelihood of breast cancer.  Those patents are in danger of being deemed outside of patent law’s subject matter, however, because they arguably protect a basic scientific truth.  So the company has adopted a variant of the strategy sketched above: Myriad has built an extensive portfolio of patents that protect its business from every conceivable perspective.

For example, in order to efficiently determine whether the genetic defect of interest is present in a patient sample, a laboratory needs to use special man-made probes that can in essence pull out the relevant genetic material.  Myriad patented those probes.  To use the probes, a laboratory scientist has to implement a particular protocol where the probe is used to produce an unmutated version of the gene.  Myriad patented that method too.  Similarly, to compare a healthy sample to a possibly tainted one, a laboratory needs to employ a different protocol to efficiently compare and contrast the samples.  Yes, you guessed it, Myriad has patent claims on that as well.

All of these other patents are admittedly second best.  The only sure-fire way to dominate this market is to control the fundamental relationship between the genetic defect and its medical consequence.  But, while litigation persists on that big-picture question, Myriad’s complementary patents keep the company strong.  Indeed, even on the day when the first court to consider these patents invalidated a slew of Myriad’s patent claims, the firm’s stock barely budged.  By patenting its key invention from multiple perspectives, Myriad had created a safety net that has thus far proven effective.

The above examples extol the virtues of complementary patenting in settings where the core invention might fall outside patent law’s permissible subject matter.  The strategy, however, has much broader application.  Consider, for instance, the technology company Universal Display.  Universal has developed an extensive patent portfolio related to a new type of television display.  Some of the company’s patents cover the actual material that is used to produce the display.  But other patents cover other things, like methods of producing the material, and concepts about how best to use the material to produce bright, flexible, energy-efficient consumer products.

Universal Display’s strategy of filing complementary patents has turned out to be enormously important to the business, because recent patent challenges in Europe have shown that the materials patents themselves might not be valid.  Had Universal Display focused exclusively on those patents, then, the company would today be in a difficult spot.  However, the company has adopted a Myriad-like patent strategy that should keep any damage in check.  Yes, Universal Display would be in a particularly good position if its materials patents survive.  Because of them, the only way to produce these new displays will be to license relevant materials from the company.  But, even without that, its heavily complementary portfolio should ensure that Universal remains relevant.  Anyone who uses these materials, after all, will ultimately need to deploy them, store them, power them, and the like.  And Universal Display has patented so many ideas along these lines that, even without its core materials patents, the company’s patents will simply be hard to avoid.

By |2018-06-01T14:15:11+00:00November 27th, 2012|Intellectual Property Issues|Comments Off on The Myriad Strategy