The United States Patent and Trademark Office (USPTO) has issued revised guidance to its examiners relating to determination of patent eligibility under 35 U.S.C. §101. This “Interim Guidance” provides more specific advice for evaluating claims directed to any technical field, but is of particular relevance to patent applications includes “nature-based” and biotechnology technologies. The previously issued guidelines included a multifactor approach which resulted in a great deal of uncertainty about the appropriate standard for examination of “nature-based” products. While no bright line rule yet exists, the newly issued Interim Guidance does provide a simpler two-step analysis framework for consideration of issues related to patent eligibility.
In 2014, the USPTO has issued to its examination corps two sets of examination instructions relating to patent eligibility under §101. First, on March 4, 2014, the USPTO issued a “Procedure For Subject Matter Eligibility Analysis Of Claims Reciting Or Involving Laws Of Nature/Natural Principles, Natural Phenomena, And/Or Natural Products” (the “Myriad-Mayo Guidance”). Earlier this week, on December 16, 2014, the USPTO issued new Guidance on Patent Subject Matter Eligibility (the “Interim Guidance”) that supersedes the Myriad-Mayo Guidance.
The Myriad-Mayo Guidance received overwhelming public criticism and the USPTO itself admitted that that it raised several controversial issues while being unnecessarily broad. The Interim Guidance was long-anticipated by practitioners in the biological and pharmaceutical arts, as the complicated framework of the Myriad-Mayo Guidance is now replaced by a more straightforward analysis. According to the Interim Guidance, patent eligibility of a claim including a nature-based product is determined under a two-step test.
First, an examiner determines whether the claim is directed to “a product of nature” exception (e.g., a law of nature or a naturally occurring phenomenon). This analysis requires comparing the nature-based product in the claim to its naturally occurring counterpart (or a closest naturally occurring counterpart) in its natural state to identify “markedly different” characteristics based on structure, function, and/or properties. Even a small change can render the claimed nature-based product “markedly different.” The Interim Guidance notes that “[c]are should be taken not to overly extend the markedly different characteristics analysis to products that when viewed as a whole are not nature-based” and directs examiners to utilize a streamlined analysis approach “[f]or claims that recite a nature-based product limitation (which may or may not be a ‘product of nature’ exception) but are directed to inventions that clearly do not seek to tie up any judicial exception. In such cases, it would not be necessary to conduct a markedly different characteristics analysis.”
Functional Differences May Avoid 2nd Step
The Interim Guidance addresses some difficulties identified in public comments regarding the “markedly different” analysis. In particular, the Interim Guidance specifies that “functional characteristics and other non-structural properties can evidence markedly different characteristics.” In the prior Mayo-Myriad Guidance, “only structural changes were sufficient to show a marked difference.” Now, a claim directed to a “nature-based product” can avoid the “significantly more” analysis of the 2nd step if the claimed product has any “markedly different” characteristics from the naturally occurring product, where “structure, function, and/or other properties” are to be considered when making the “markedly different” determination.
One example presents a purified protein as being patent eligible because there is a resultant change in characteristics sufficient to show a marked difference from the product’s naturally occurring counterpart. Moreover, the Interim Guidance states that “[w]hen the nature-based product is produced by combining multiple components, the markedly different characteristics analysis should be applied to the resultant nature-based combination rather than its component parts.” Thus, a combination of nature-based products may be patent-eligible if it has markedly different characteristics than any naturally occurring counterparts of the combination or the individual components.
Moreover, the Interim Guidance excludes a process claim from the markedly different analysis for nature-based products used in the process, “except in the limited situation where a process claim is drafted in such a way that there is no difference in substance from a product claim (e.g., ‘a method of providing an apple.’).” This is a welcome change from the previous guidance such that that process claims usually will not raise eligibility issues for reciting nature-based products.
Only if no “markedly different” characteristics are found, the analysis proceeds to the second step of determining if the claim recites additional elements that amount to “significantly more” than the judicial exception when the elements of the claim, considered both individually and as an ordered combination. The “significantly more” finding is based on what has been termed as an “inventive concept” based on the Supreme Court’s Alice decision. The guidance emphasizes that “[i]ndividual elements viewed on their own may not appear to add significantly more … but when combined may amount to significantly more than the exception.”
Furthermore, when rejecting a claim during examination, the Examiner is asked to “identify the exception by referring to where it is recited . . . in the claim and explain why it is considered an exception. Then, if the claim includes additional elements, identify the elements in the rejection and explain why they do not add significantly more to the exception.” Thus, the Interim Guidelines provide that “[i]f there are no meaningful limitations in the claim that transform the exception into a patent-eligible application, such that the claim does not amount to significantly more than the exception itself, the claim is not patent-eligible.”
While the additional examples in the Interim Guidance of limitations provide a simpler scheme, it does not provide a bright line test for what is and is not patent eligible. Such a bright line rule appears unlikely to be forthcoming from the courts in the near future. Patent practitioners and applicants can take some comfort, however, in the broader base of potential arguments available for rebutting a rejection based on alleged lack of patent eligibility. A study on patent applications released this summer by BIO and Bloomberg BNA found that roughly 40% of reviewed claims similar to the ones under scrutiny in Mayo and Myriad received a Section 101 rejection. However, under the Revised Guidance, some of these rejected claims would be patentable subject matter.
The take away for practitioners and applicants is to present claims that highlight such features and/or that truly add meaningful limitations recited in a manner that does not give the appearance of precluding any way of practicing a concept that is amenable to characterization as one of the judicial exceptions. The new analysis focuses on the claims as a whole and on the “markedly different” properties of the claimed subject matter as compared to the natural counterpart product. However, the Interim Guidance provides what appears to be a more workable framework. While the Interim Guidance may be helpful to many applicants with claims involving natural products, it does not provide much discussion of diagnostic or personalized medicine method claims. The USPTO may be waiting for further guidance from the Federal Circuit on these types of claims, and until then includes only the Prometheus claims in its examples.