Do Diagnostic Method Claims Fall under the Safe Harbor of 35 U.S.C. § 287(c)? (And If So, Would That Address Justice Breyer's Concerns in Mayo v. Prometheus)?

by McDonnell Boehnen Hulbert & Berghoff LLP

[author: Kevin E. Noonan]

Prometheus LaboratoriesSometimes solutions to thorny issues are within our grasp if only we looked in the right place.  The Supreme Court's recent decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc. raises the specter of the Court throwing out the patent system baby in order to preserve the medical community's bathwater, with (paradoxically) the prospect of fatally harming both.  It is clear that trying to address these issues through a reasoned explication of patent law is like trying to teach the proverbial donkey to count (or perhaps trying to explain compound interest to a disinterested teenager).  So instead, perhaps the way to address the concern that patents may somehow "harm" a medical practitioner's ability to treat patients is to give doctors what they want -- a "get out of jail free" card for infringement.

This has been done before, of course, to address patent claims directed to methods for performing eye surgery.  The patent, U.S. Patent No. 5,080,111 to Dr. Pallin, was being asserted (Pallin v. Singer, 1996 WL 274407 (D. Vt., Mar. 28, 1996)) against medical doctors and eye clinics in the mid-1990's and prompted swift Congressional action (relative to the glacial pace of patent reform over the past three Congresses).  The measure that ultimately passed, introduced by Senator Bill Frist of Tennessee (himself a physician) was codified as 35 U.S.C. § 287(c):

35 U.S.C. 287 Limitation on damages and other remedies; marking and notice.

                                                            * * *

(c)(1) With respect to a medical practitioner's performance of a medical activity that constitutes an infringement under section 271(a) or (b) of this title, the provisions of sections 281, 283, 284, and 285 of this title shall not apply against the medical practitioner or against a related health care entity with respect to such medical activity.

(2) For the purposes of this subsection:
    (A) the term "medical activity" means the performance of a medical or surgical procedure on a body, but shall not include (i) the use of a patented machine, manufacture, or composition of matter in violation of such patent, (ii) the practice of a patented use of a composition of matter in violation of such patent, or (iii) the practice of a process in violation of a biotechnology patent.
    (B) the term "medical practitioner" means any natural person who is licensed by a State to provide the medical activity described in subsection (c)(1) or who is acting under the direction of such person in the performance of the medical activity.
    (C) the term "related health care entity" shall mean an entity with which a medical practitioner has a professional affiliation under which the medical practitioner performs the medical activity, including but not limited to a nursing home, hospital, university, medical school, health maintenance organization, group medical practice, or a medical clinic.
    (D) the term "professional affiliation" shall mean staff privileges, medical staff membership, employment or contractual relationship, partnership or ownership interest, academic appointment, or other affiliation under which a medical practitioner pro- vides the medical activity on behalf of, or in association with, the health care entity.
    (E) the term "body" shall mean a human body, organ or cadaver, or a nonhuman animal used in medical research or instruction directly relating to the treatment of humans.
    (F) the term "patented use of a composition of matter" does not include a claim for a method of performing a medical or surgical procedure on a body that recites the use of a composition of matter where the use of that composition of matter does not directly contribute to achievement of the objective of the claimed method.
    (G) the term "State" shall mean any state or territory of the United States, the District of Columbia, and the Commonwealth of Puerto Rico.

(3) This subsection does not apply to the activities of any person, or employee or agent of such person (regardless of whether such person is a tax exempt organization under section 501(c) of the Internal Revenue Code), who is engaged in the commercial development, manufacture, sale, importation, or distribution of a machine, manufacture, or composition of matter or the provision of pharmacy or clinical laboratory services (other than clinical laboratory services provided in a physician's office), where such activities are:
    (A) directly related to the commercial development, manufacture, sale, importation, or distribution of a machine, manufacture, or composition of matter or the provision of pharmacy or clinical laboratory services (other than clinical laboratory services provided in a physician's office), and
    (B) regulated under the Federal Food, Drug, and Cosmetic Act, the Public Health Service Act, or the Clinical Laboratories Improvement Act.

(4) This subsection shall not apply to any patent issued based on an application the earliest effective filing date of which is prior to September 30, 1996.

The policy justification for the bill was, as eloquently expressed by Senator Frist, because "innovations in surgical and medical procedures do not require the midwifery of patent law."  As enacted into law, the bill reflects a carefully crafted ("narrowly tailored") balance between the concerns of the medical community and the patent community, particularly the biotechnology community.  For example, "biotechnology patents" are expressly excluded from the exemption; such patents are defined (under 35 U.S.C. § 103(b)) as "a process of genetically altering of inducing a single or multi-celled organism" or "cell fusion procedures yielding a cell line that expresses a specific protein" or "methods of using a product produced" by the above processes.  Also not exempt are individuals involved in the commercialization of "a machine, manufacture, or composition of matter" related to a medical activity.  Importantly, the provision does not exempt commercial clinical labs, including ones regulated under CLIA, who perform medical diagnostic methods.

Expressly and by implication, these exclusions to the exemption do not include clinical laboratory services provided in a physician's office, and the statute is expressly directed to the "performance of a medical activity," which is defined as "a medical or surgical procedure on a body."  The statute does not include "diagnostic methods" within this definition of a "medical activity," but this is not an instance where the absence can be used to read anything into the legislative history, because the excluded provision was in fact in a different bill that was not considered by Congress.  But (perhaps) significantly the exclusions to the exemption eschew mention of only one category of patent-eligible subject matter, methods.

Including diagnostic methods (limited to those performed in a physician's office) to the exemption might address the policy concerns raised by Justice Breyer in Mayo (and before that in Laboratory Corp. v. Metabolite Labs., Inc.).  Such balancing of policy concerns has been done in the other patent law provisions, such as the safe harbor provisions of 35 U.S.C. § 271(e)(1); there, the policy purpose was to permit generic drug makers to prepare for market entry upon innovator drug patent expiration (ignoring for the moment the real effect of providing strong incentives for generic companies to utilize the provisions of § 271(e)(2) to challenge those patents rather than waiting for them to expire).  It is thus possible to read the law as containing (sub silentio, to be sure) diagnostic methods within the scope of the safe harbor.

Commentators are almost uniform in rejecting this interpretation, however, believing that Congress must more expressly enunciate the exemption in order for it to be effective.  See, Sirjani & Keyhani, "35 U.S.C. 287(C): Language Slightly Beyond Intent," 3 Buffalo Intellect. Prop. Law J. 13 (Fall 2005); Rundle, "The Physician's Immunity Statute: A Botched Operation or a Model Procedure?" 34 Iowa J. Corp. L. 943 (Spring 2009); Hu and Mallin, "Medical Method Patents: Treating 'The Physicians' Immunity Statute,'" 23 Syr. Sci Technol. Law Reporter 63 (Fall 2010).  In part, this conclusion is based on the phrase "medical or surgical procedure on a body," which is interpreted to exclude assays of blood, urine, tissue, or other biological samples that are taken from a body.

Washington - Capitol #5Should Congress deign to make inclusion of medical diagnostic methods within the scope of the exemption, such an action would comport with Justice Breyer's invitation at the end of the Mayo opinion ("[a]nd we must recognize the role of Congress in crafting more finely tailored rules where necessary").  Congress also has the opportunity to act (without having to take up the measure anew), having scheduled and held hearings on "technical" amendments to the Leahy-Smith America Invents Act that create the possibility for additional fine tuning of the patent system.  Perhaps Congress could take up this issue, and while it's at it complete revision to 35 U.S.C. § 101.  That provision of the statute now includes Section 23 (the Weldon amendment provisions: "Notwithstanding any other provision of law, no patent may issue on a claim directed to or encompassing a human organism"), and it could readily be further amended to expressly recite that diagnostic method claims are patent eligible subject matter.  Coupled with revisions to § 287(c) to expressly exempt clinical laboratory services provided by physicians (and not commercial clinical labs), this legislative scheme might reduce the temperature of those whose concern over the possibility that patent protection might inhibit medical services delivery has created the greater likelihood that innovation will be harmed by a lack of patent protection (or worse, that disclosure will decline, reducing the pace of innovation).

It is clear that the philosophical disconnect between the Supreme Court and the Federal Circuit (and the failure of the Supreme Court to credit the Federal Circuit's particular area of expertise in deciding over the past decade to assert its hierarchical prerogatives over the lower court) has disrupted the system envisioned by Congress in creating the specialized appellate court.  Accordingly, it is now time for Congress to impose by legislation the corrective measures needed to restore American patent law to its position in "promoting the Progress of . . . the Useful Arts."


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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