In order to understand the impact of legal decisions such as D'Arcy v Myriad Genetics Inc. [2015] HCA 35 (‘Myriad’) on genetic diagnostic testing, IP Australia commissioned the Centre for Law and Genetics at the University of Tasmania to undertake an investigation into this area. Based on previous studies, surveys, and interviews with key stakeholders, the research investigated the impacts of the Myriad decision on the cost and availability of genetic testing in Australia and their implications for genetic testing service providers.   

In October 2015 the Australian High Court in Myriad found that isolated nucleic acid sequences encoding the BRCA1 mutant polypeptide were not patentable. The case related to Myriad’s patent on genetic sequences encoding mutations that increase the likelihood of developing breast or ovarian cancer. Following the judgment, and after public consultation, IP Australia established a revised examination practice and affirmed that isolated naturally occurring nucleic acid molecules are excluded from patent eligible subject matter, unless the genetic information has been "made".

Prior to the Myriad case, concerns prevailed that gene patenting and patent enforcement would affect the pricing and provision of genetic testing due to the allocation of exclusive rights and the payment of license fees or royalties. The underlying policy dilemma was a search for balance between the encouragement of research and development (R&D) and access to genetic diagnostic testing services. 

Findings from the University of Tasmania report reveal limited evidence that the Myriad decision has had a quantifiable impact on the cost of genetic diagnostic testing in Australia. This is also the general consensus across the interviewees of the research. If the decision has had any impact, this effect is unlikely to be discernible and would be difficult to separate from the other factors impacting on cost. In many cases, technological development and competitive pressures have led to a dramatic decline in test costs.

Another important finding from the report is that, even before the Myriad decision, no long-term interruptions to genetic testing have been observed due to patent enforcement. According to the report, there were very few instances in Australia where enforcement has proceeded to the point where it has impacted on the delivery of tests. In some cases, this was primarily due to the expectation of a public backlash that would ensue should enforcement proceedings be taken. Another explanation for the fact that these moves have not been followed through is the size of the Australian genetic testing market and its largely publicly funded structure.

The research concludes that it is not feasible to conduct a comprehensive economic analysis of the impact of the Myriad decision. It would be challenging to quantify the impact of Myriad on prices charged subsequent to the decision. It is important to note that method patent claims were not involved in the Myriad case. While genes as they exist in nature are not generally regarded as patentable subject matter, methods involving such genes are potentially patentable. The report recommends that analysis of method patent claims and patent prosecution be undertaken, and it is important from a policy perspective to subject this issue to further scrutiny in the Australian context.

The report is available at: http://www.utas.edu.au/law-and-genetics/publications/occasional-papers. For details of the report, contact the Centre for Law and Genetics at contact.clg@utas.edu.au.

Published: 
19 March 2019