Testing firms land counterpunch

Issues joined in Myriad suits

It’s been a rocky road for women who need, and can’t afford, genetic testing for breast cancer, but answers — and counterclaims — filed this week to lawsuits brought in the federal court in Utah should go a long way towards resolving, once and for all, whether Myriad Genetics will be able to protect its high-priced monopoly.

Two companies sued by Myriad after they announced they would offer their own lower-priced tests for the BRCA1 and BRCA2, genes that — if present — cause a significantly elevated risk of breast and ovarian cancer, filed their answers this week, charging Myriad with trying to monopolize the market in violation of federal antitrust laws.¹

Ambry Genetics of Aliso Viejo, California, and Gene by Gene of Houston, Texas — parent company to Family Tree DNA — each filed their answers to Myriad’s complaints in the United States District Court for the District of Utah. In them, each has denied infringing any of Myriad’s patents and has counterclaimed against the monopoly.²

These lawsuits have their origin in work done in the 1990s by various researchers on which Myriad won the race to the Patent Office: it secured patents on two human genes called BRCA1 and BRCA2, genes that — if present — cause a significantly elevated risk of breast and ovarian cancer.

The patents gave Myriad the sole right to test women for the presence of those genes. So armed, the company went after academic and medical researchers to stop them from trying to test for the genes and jacked the price of its test up to as much as $4,000.

In June of this year, the U.S. Supreme Court struck down key elements of the Myriad patents: it ruled unanimously in the case of Association for Molecular Pathology v. Myriad Genetics that “a naturally occurring DNA segment is a product of nature and not patent eligible merely because it has been isolated.”³

Ambry and DNATraits, a division of Gene by Gene, immediately announced after the Court’s ruling that they would begin offering much less expensive BRCA1 and BRCA2 testing. Bennett Greenspan, President of Gene by Gene, said at that time that “the Supreme Court was very clear that gene sequences, even when isolated, cannot be patented. In light of this ruling we are pleased that we can now offer Americans the benefit of this more affordable test that we have already successfully offered to overseas clients.” The DNATraits testing was priced at $995, a fraction of the Myriad testing.

And it was the threat of those lower-priced tests that led Myriad to file suit in July, alleging that the tests infringe other patents in ways not affected by the Supreme Court decision.

In their answers, the two companies:

• flatly deny infringing any patents owned by Myriad or its partners;
• challenge the validity of the asserted patents under three separate sections of the federal patent statute;
• challenge the underlying patentability of the materials key to the asserted patents; and
• challenge the enforcement of the asserted patents on the basis of patent misuse.⁴

But the two defendants went beyond merely answering the complaint; both have counterclaimed for antitrust violations.

Gene by Gene’s counterclaim alleges, in part:

Myriad has in bad faith brought this lawsuit against Gene by Gene on patent claims that it knows are invalid under two Supreme Court decisions and Federal Circuit authority. In doing so, Myriad continues a practice of using sharp and overreaching practices to wrongfully monopolize the diagnostic testing of human BRCA1 and BRCA2 genes in the United States and to attempt to injure any competitor who dares to challenge Myriad’s monopoly, including Gene by Gene. These practices include (1) using research funded by public money to file patents over alleged inventions that the Supreme Court and the Federal Circuit have confirmed never should have been patented, (2) using those patents to intimidate and chill competition in the BRCA1 and BRCA2 genetic screening markets in the late 1990s to ensure monopoly profits, and (3) taking patients’ personal BRCA1 and BRCA2 genetic sequence data and depriving the public of access to that data to inhibit competition.⁵

Ambry’s counterclaim adds one more allegation, that Myriad’s practices include “using sales and marketing tactics with genetic counselors and payors to intentionally misrepresent the accuracy and reimbursement of Ambry’s BRCA1 and BRCA2 diagnostic tests.”⁶

Each company also claims that Myriad violates federal antitrust law:

Myriad is willfully maintaining its monopoly through exclusionary conduct … including through the bad faith enforcement of its facially invalid patents. … Due to Myriad’s anticompetitive conduct, customers must pay significantly higher prices for Myriad’s products in the relevant market, often nearly twice as high as the price of … competitors. Myriad’s bad faith and illegal enforcement of the asserted patents has ensured that customers have virtually nowhere to turn but Myriad and its monopoly-priced products.⁷

We’re clearly in for a dogfight over human genetic testing, who gets to profit — and by how much.

For myself, I’m rooting for the consumer: for each and every individual woman who needs this testing and faces the Myriad pricetag.

SOURCES