Federal Circuit Court overturns district court’s ruling in the REGENEXBIO, Inc vs Sarepta case

Federal Circuit Court overturns district court’s ruling in the REGENEXBIO, Inc vs Sarepta case

The judges noted that the analogy in a previous matter was flawed and inconsistent with the undisputed scientific evidence

In an executive order, the US Court of Appeals for the Federal Circuit (CAFC) has overturned the decision of Judge Richard Andrews of the District Court of Delaware’s grant of summary judgment, which ruled that the patent claims of biotechnology company REGENEXBIO, Inc were ineligible as directed to a natural marvel.

The court observed that REGENXBIO’s and the Trustees of the University of Pennsylvania’s gene therapy patent claims were directed to a natural phenomenon, meaning occurrences without human intervention. Thus, the patent was ineligible under 35 U.S.C. § 101.

However, the unanimous decision of the Appeals Court delivered by Judge Kara Stoll, Judge Timothy Dyk and Judge Todd Hughes set aside the ruling. As a result, REGENEXBIO’s infringement suit against Sarepta Therapeutics, Inc. and Sarepta Therapeutics Three, LLC was revived.

The matter was ignited when REGENXBIO filed a patent infringement suit in the District of Delaware. It alleged that Sarepta infringed claims 1 through 9, 12, 15, and 18-25 of U.S. Patent No. 10,526,617.

The ‘617 patent, titled “Method of Detecting and/or Identifying Adeno-Associated Virus (AAV) Sequences and Isolating Novel Sequences Identified Thereby,” is directed to genetically engineered host cells that contain AAV rh.10 sequences.

REGENXBIO, the biotechnology company on a mission to improve lives through the curative potential of gene therapy, accused Sarepta of infringing the patent. It stated that the latter used the AAV variant rh.74 in cultured host cells to produce SRP-9001, a gene therapy product for Duchenne muscular dystrophy (DMD), a severe, progressive genetic disorder primarily affecting young boys, causing muscle degeneration due to a lack of the protein dystrophin.

It added that representative claim 1 of the patent recites a “cultured host cell containing a recombinant nucleic acid molecule” that encodes an AAV capsid protein sequence and further comprises a “heterologous non-AAV sequence.” This means a sequence from a different species.

The company claimed that cultured host cells were undeniably human-made and are not a natural phenomenon. A recombinant nucleic acid molecule is created by chemically splicing together nucleic acid sequences from two different organisms, it maintained.

As the dispute escalated, both REGENXBIO and Sarepta approached the district court for summary judgment on patent eligibility.

The district court granted Sarepta’s motion, holding the asserted claims ineligible as directed to a natural phenomenon. The court cited the markedly different characteristics test in the Diamond v. Chakrabarty case, wherein it was ruled that none of the individual naturally occurring components in the claims had been changed and that combining natural products and placing them in a host cell did not mean the invention was patentable.

The district court compared the claims to the ineligible invention in the Funk Brothers Seed Co. v. Kalo Inoculant Co. case.

It reasoned that taking two sequences from two different organisms and putting them together was “not different than taking two strains of bacteria and mixing them.”

Furthermore, the district court noted that the claims lacked an inventive concept under the second step of the Alice/Mayo framework known as the Mayo test. It is a two-part framework established by the Supreme Court for determining patent subject matter eligibility.

But after an appeal, the Federal Circuit Court explained that the proper inquiry, as defined by the Supreme Court in the Diamond vs Chakrabarty case, was whether the claimed composition had “markedly different characteristics and the potential for significant utility” compared to what occurred naturally.

Thus, on applying the mentioned framework, the Court of Appeals ruled that the claims were more analogous to the eligible inventions in the Diamond vs Chakrabarty case, and the complementary DNA (cDNA) claims in the Association for Molecular Pathology v. Myriad Genetics, Inc. case, than to the ineligible claims in the Funk Brothers, Myriad case and the ChromaDex, Inc. v. Elysium Health, Inc. matter

The Federal Circuit Court of Appeals thus highlighted that it was uncontested that the claimed host cells included a recombinant nucleic acid molecule that does not and cannot exist in nature. The recombinant molecule must be spliced together through human intervention from at least two different species to meet the claim limitations.

The judges explained that, as with the man-made plasmid in the Diamond vs Chakrabarty case, the claimed nucleic acid molecules, “although containing naturally occurring segments of DNA, were not nature’s handiwork.”’ Similarly, as with the cDNA claims in the Association for Molecular Pathology v. Myriad Genetics, Inc. case, “the lab technician unquestionably creates something new” on splicing together the claimed recombinant nucleic acid molecule and inserting it into a host cell.

Therefore, the Federal Circuit Court said that the district court’s analogy in the Funk Brothers matter was “flawed and inconsistent with the undisputed scientific evidence.” The court added that genetically engineering two nucleic acid sequences from separate species into a single molecule was “materially different from growing more than one naturally occurring bacterial strain in a culture where none of the bacteria undergo any change from their natural state.”

At the same time, the judges held that the district court took “too narrow a view of the asserted claims” by focusing on whether the individual components were markedly different from what was occurring naturally rather than considering the claimed “composition as a whole.”

The court thus rejected the contention of Sarepta that conventional claim limitations should be disregarded, citing the Supreme Court’s instruction that it was “inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the [§ 101] analysis.”

Additionally, the Court of Appeals for the Federal Circuit noted that unlike the claims in the Funk Brothers case, the claimed composition in this matter had undisputed “potential for significant utility.”

It stated that various embodiments of the claimed compositions “are beneficial for gene delivery to selected host cells and gene therapy patients,” a fact touted in the patent’s specification. This was in “stark contrast” to the Funk Brothers matter, where the composition functioned no differently whether the individual components were packaged together or separately.

Therefore, the judges held that the claimed host cells were not patent-ineligible claims to naturally occurring subject matter. Since the claims were not directed to a natural phenomenon under the first step of the Alice/Mayo test, the Federal Circuit Court did not need to proceed to the second step.

While reversing the judgment, the case was remanded for further proceedings.