On July 5, 2016, the Federal Circuit held that claims reciting methods for cryopreserving hepatocytes in U.S. Patent No. 7,604,929 ("the '929 patent") are eligible for patenting.1 The decision vacated a lower court's holding that the claims are invalid because they are directed to a patent-ineligible "law of nature" and that the patented process lacks an inventive concept.2 A United States Patent and Trademark Office (USPTO) memorandum to patent examiners indicated that the case provides clarification on the inquiry for subject matter eligibility determinations.3 The case also provides guidance to patent applicants claiming subject matter in the biological sciences.
Subject matter eligible for patenting in the United States is defined in 35 U.S.C. § 101 and includes "any new and useful process, machine, manufacture, or composition of matter."4 However, courts have created judicial exceptions to these categories, including laws of nature, natural phenomena, and abstract ideas.5 The U.S. Supreme Court recently established a two-part test for determining whether claimed subject matter is eligible for patenting. In the first test, a court must determine "whether the claims at issue are directed to one of [the] patent-ineligible concepts."6 If the claims are directed to a patent-ineligible concept, the court will conduct a second test to search for an "'inventive concept'—i.e., an element or combination of elements that is 'sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself.'"7 More is required than "well-understood, routine, conventional activity previously engaged in by researchers in the field."8 If a court determines that the claims satisfy the requirements of either of the tests, the court will find the claims to be patent-eligible; if neither test is satisfied, the court will find the claims to be patent-ineligible.
The claims at issue in the '929 patent recite methods for producing cryopreserved hepatocytes. Hepatocytes are a type of liver cell that can be used for a variety of purposes, and storage techniques can affect the usefulness of hepatocytes. A prior art technique for cryopreserving hepatocytes caused damage to the cells and was unsuitable for preparing multi-donor hepatocyte pools. The inventors of the '929 patent discovered that some hepatocytes are capable of surviving multiple freeze-thaw cycles and also discovered a way of pooling hepatocyte samples from single donors to create a composite preparation that can be frozen for later use.9 Claim 1 is representative of the claims of the '929 patent and recites a method of producing a desired preparation of multi-cryopreserved hepatocytes including steps for subjecting hepatocytes that have been frozen and thawed to a density gradient fractionation, recovering separated viable hepatocytes, and cryopreserving the recovered viable hepatocytes. Claim 5 was also considered by the Federal Circuit and recites that the preparation comprises a pooled preparation of hepatocytes of multiple sources.
The lower court applied the two-part test to the claims and found the claims to be invalid under § 101.10 In step one, the lower court determined that claims were directed to "an ineligible law of nature: the discovery that hepatocytes are capable of surviving multiple freeze-thaw cycles."11 In step two, the lower court determined that the claims did not recite an inventive concept, indicating that the inventors "reapplied a well-understood freezing process."12
On appeal, however, the Federal Circuit found that the claims recited patent-eligible subject matter. The Federal Circuit noted that "at step one ... it is not enough to merely identify a patent-ineligible concept underlying the claim; we must determine whether that patent-ineligible concept is what the claim is 'directed to.'"13 The Federal Circuit determined in step one that the "claims are directed to a new and useful laboratory technique for preserving hepatocytes."14 The court distinguished the claims in the '929 patent from patent-ineligible claims at issue in other cases that "amounted to nothing more than observing or identifying the ineligible concept itself." The court stated that "[t]he end result of the '929 patent claims is not simply an observation or detection of the ability of hepatocytes to survive multiple freeze-thaw cycles" and emphasized that the claims recite a "method of producing...."15 The Federal Circuit also remarked that the "resulting preparation, and the process for creating it, achieved a notable advance over prior art techniques for preserving hepatocytes."16 With respect to claim 5, the court noted that "[b]ecause the claimed process involves both multiple freeze-thaw cycles and pooling cells from various donors, it results in a preparation that is both new and vastly more useful for research than hepatocyte preparations made by conventional methods."17
The Federal Circuit also indicated that it would find the claims patent-eligible at step two because the claims recite an inventive application.18 The court determined that the claims "recite an improved process for preserving hepatocytes for later use."19 The court also determined that "[t]he claimed method is patent eligible because it applies the discovery that hepatocytes can be twice frozen to achieve a new and useful preservation process."20 Furthermore, the court noted that while the "individual steps of freezing and thawing were well known," a "process of preserving hepatocytes by repeating those steps was itself far from routine and conventional."21
The Federal Circuit's holding suggests several practice tips for patent applicants to help develop a patent application and file history to increase the likelihood that claims to processes in the field of biotechnology are considered patent-eligible. For example, practitioners can avoid drafting process claims directed to an observation or detection, but instead draft process claims directed to an application of a concept. In order to demonstrate an improvement to a process, patent specifications can be drafted to include evidence of how claimed subjected matter provides an advance in the relevant field. Furthermore, when facing a subject-matter eligibility rejection during prosecution, post-filing evidence can be provided in the form a declaration to demonstrate how claimed subject matter provides an advance in the field. Arguments can be presented to overcome subject matter eligibility rejections during prosecution that demonstrate that the claimed process is not directed to well-understood, routine, and conventional activity in the relevant field. The USPTO has updated patent examiners about the case and indicated that its current subject matter eligibility guidance and training examples are consistent with the Federal Circuit's decisions in the case.22
