Ambry Genetics countersues Myriad Genetics in BRCA testing fight

Ambry

Back in June the Supreme Court unanimously ruled native DNA cannot be patented, and this invalidated Myriad Genetics’ patents on the BRCA1 and -2 genes.  Literally the same day the decision was announced, Ambry Genetics and Gene by Gene both announced they would begin offering BRCA testing.  Despite the Supreme Court’s ruling, Myriad filed lawsuits against both companies for patent infringement.  Last week Ambry responded by countersuing Myriad for monopolization and attempted monopolization.

As I stated in my previous post, the basis of Myriad’s suit against Ambry and Gene by Gene is the two companies are infringing on Myriad’s patents that utilize conventional laboratory techniques to sequence the BRCA gene and assess it for mutations, not for infringing on the BRCA gene patents themselves, which were invalidated.

In its response to Myriad’s suit, Ambry denies any wrongdoing and then goes on to advance its own counterclaims against Myriad, which I will only briefly discuss.  Those interested in more specifics can refer to the answer and countersuit itself.

Myriad Is Maintaining Its Monopoly In Violation Of The Antitrust Laws Through Its Bad Faith Enforcement Of Its Patents

Ambry states Myriad is violating the Sherman Antitrust Act by suing to protect its nearly two decade old monopoly on BRCA testing after the Supreme Court invalidated its patents.  Ambry further asserts Myriad knows its patents have been invalidated and is therefore acting in “bad faith.”

Ambry then goes on to describe how Myriad, through collaborative efforts with international laboratories and significant public funding for BRCA research, patented the BRCA1 and -2 genes for itself, and then sued or threatened to sue any labs involved in BRCA testing, including at least one of its former collaborators, so as to maintain its monopoly.

Myriad Eschews Considerations Of Affordability, Test Accuracy, And Recommendations For Genetic Testing

Ambry asserts Myriad did not attempt to make its tests more affordable nor did it follow recommendations and guidelines from the Federal Task Force on Genetic Testing, the American Society of Clinical Oncology, the National Breast Cancer Foundation or the National Action Plan on Breast Cancer regarding genetic testing for breast cancer patients.  Ambry also says Myriad claimed its BRCA tests were state-of-the-art, when in fact they allegedly missed up to 12% of mutations.

There Exists Significant Opposition To Myriad’s Business Model of Patenting Gene Sequences And Establishing A Private Database

In 2004, Myriad stopped contributing data to a public database it had itself set up in 1996 for storing “personal and family cancer histories of the patients that had purchased Myriad’s tests to understand whether they had any mutations in their BRCA1 and BRCA2 genes.”  In 2005, Myriad stated it did so so as to keep the information a trade secret.

According to Ambry, this move was opposed by “[p]oliticians, clinicians, breast cancer advocacy groups and commentators.”

As an aside, back in January I highlighted an interview the current CEO of Myriad, Dr. Peter Meldrum, did with Bloomberg that included a question as to why Myriad was not contributing data to a new public database on genetic mutations to which 48 other US companies and universities are contributing. Dr. Meldrum said data sharing simply “doesn’t make a lot of business sense.”

Myriad Is Aware That Its Asserted Claims On BRCA1 And BRCA2 Genes Are Invalid Under Recent Supreme Court And Federal Circuit Cases

Ambry states the resolution of the Mayo v. Prometheus and Association for Molecular Pathology v. Myriad cases proves Myriad is bringing this suit in bad faith.

Myriad Filed This Lawsuit To Enforce Its Invalid Patents In Bad Faith In Order To Keep Competitors From Entering The Market

Using Myriad’s own words from its Application for a Preliminary Injunction, Ambry shows Myriad’s goal in filing the lawsuit is to maintain the “status quo.”

Myriad Has Market Power And Has Harmed The Market

According to the countersuit, Ambry believes “Myriad has over 90% market share in the relevant market. Myriad possesses the power to control prices and exclude competitors.”

Ambry says Myriad is attempting to exclude it from the market by telling genetic counselors Ambry’s tests infringe on Myriad’s patents and that Ambry’s variant of unknown significance (VUS) rate is 10-30%.  A VUS is a genetic mutation with an unknown clinical significance.  Obviously, the higher the VUS rate, the less clinically helpful a test is.

In a press release, Ambry says its VUS rate is “approximately 5%.”

Because of Myriad’s aggression towards possible competitors, Ambry believes patients have been harmed, as they have been forced to pay higher charges for BRCA testing than they would have had the market been truly competitive.

Additional Counts

In addition to suing Myriad for violations of the Sherman Act, Ambry also asks the court for a declaratory judgement of non-infringement and invalidity of the 15 different patents upon which Myriad alleges Ambry infringed.

Commentary

It is very important to note AMP v. Myriad dealt with “composition of matter” claims.  Myriad, however, is suing Ambry and Gene by Gene with “method” claims, so there is technically no conflict legally with the Supreme Court decision.

If Myriad’s suit is successful, however, it will have the practical effect of undermining the Supreme Court’s decision and allow Myriad to maintain dominance in the BRCA testing industry.

These cases will obviously take quite a while to get sorted out, which is why I still believe Myriad’s primary goal may not be to win per se, but to simply tie competitors up in litigation until its BRCA patents expire, beginning in 2015.

The full answer and countersuit is here.

Comments

  1. TM says:

    The whole idea of a patent is to create a monopoly, a legal monopoly, if only for a subscribed time frame. As the US Constitution gives one the right to have a patent, and a patent by its workings creates a monopoly, this becomes an interesting defense put up by Ambry. As Justice Thomas noted at the end of the Myriad Opinion:

    “We express no opinion whether cDNA satisfies the other statutory
    requirements of patentability….” ” Nor do we consider the patentability of DNA in which the order of the naturally occurring nucleotides has been
    altered. Scientific alteration of the genetic code presents a
    different inquiry, and we express no opinion about the
    application of §101 to such endeavors. We merely hold
    that genes and the information they encode are not patent
    eligible under §101 simply because they have been isolated
    from the surrounding genetic material.” Thus leaving open the other Myriad patents.

    Additionally, the antitrust laws were created to protect consumers, not competitors. Good luck with that antitrust theory.

    • A says:

      Very good points…

      How do you think Myriad’s “method” claims will stand up after Mayo v. Prometheus? After all, Myriad is arguing the well-known and conventional methods included in its patents are somehow “novel” and should be protected. Surely it cannot believe that, which is why I believe it is merely trying to run out the clock. Do you disagree?

      Also, Ambry is claiming Myriad is harming consumers by forcing them to pay higher fees for Myriad’s tests than they would have to had Myriad not decided to enforce its patents in bad faith. Do you think this consumer harm reasonably falls under the intent of the Sherman Act? But I agree, I’m not sure how that argument will play out.

      Thanks so much.

      • Tm says:

        I do not know enough to say how the methods claims will hold up, but as I understood it, there were many other patents Myriad held that need to be addressed other than just the method claims, so this could go the way of the SCOTUS case, block one patent and they pull another from their bag of tricks.

        I agree running out the clock is a major strategy. Wouldn’t you do that also if it were your patent?

        And if “consumer harm” for an expensive test were actionable under Sherman, then why are we all be paying Brand Name pharmaceutical prices rather than generic drug prices for brand name medicines?

        Thanks

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