KEI notes on USPTO roundtable on genetic diagnostic testing

On Thursday, 10 January 2013, USPTO held a roundtable on genetic diagnostic testing. This roundtable followed up on the public hearing hosted by USPTO nearly a year ago (and the written comments submitted). The purpose of the public hearings last year was so that USPTO could gather information and viewpoints in advance of the report it was directed to write at the behest of Congress in the America Invents Act. Congress, in Section 27 of the AIA, tasked USPTO to evaluate the lack of availability of secondary, confirmatory testing and come up with recommendations in relation to patenting and licensing practices in the context of genetic diagnostic testing, specifically with regard to secondary or confirmatory testing. The report was widely expected to be released in June 2012, but as Deputy Teresa Rea noted at the opening of the roundtable, further review and analysis was deemed necessary in order to "produce the best study possible."

My notes from the roundtable follow. Notably, USPTO Chief Economist Stuart Graham who is in charge of writing the report was not in attendance.

Deputy Rea opened the roundtable asserting that USPTO has a responsibility to ensure that the patent system keeps pace with innovation, but that it cannot take place in the patent infrastructure of the past. She noted a desire to "modernize" the IP system, but also to ensure that regulations do not provide a false dichotomy between the incentives to innovate and access to medical technologies. Deputy Rea also laid out the intended scope of the roundtable to examine the use and impact of secondary, confirmatory (second opinion) diagnostic testing on treatment and on those holding the patents on these tests as well as the impact on insurance. She noted that USPTO was evaluating how the status quo affects patient outcomes and how to provide for secondary testing.

Deputy Administrator for Policy and External Affairs George Elliott acknowledged that legislative response may be necessary. He noted that the purpose of the roundtable was to fill in gaps on insurance coverage and licensing agreements.

The first half of the roundtable included speakers who had not attended the previous two public hearings held in early 2012 (one in DC, one in San Diego). These speakers included officials from government agencies, professors, researchers, patient groups and clinicians. The second half of the roundtable had repeat speakers from the DC public hearing.

Henry Wixon, National Institute of Standards of Technology, was the first speaker. He focused on the increasing support of non-government funded private entities and stated that an "important practical consequence" of such support is that the U.S. government is less able to dictate the outcome of research. Noting a Presidential Memorandum challenging agencies to streamline technology transfer and improve translation of lab discoveries to practical products, Wixon stated that the cost of transition is typically borne by start-up companies and that clinical diagnostic testing falls under such an area. He noted that it can be expensive to get regulatory approval on a test and would be impossible to direct the private sector to do this without providing for incentives. Using the incentives for investment into orphan drugs as an example, Wixon suggested that a similar incentive structure could be used to induce investment into secondary diagnostic testing to produce a "win-win outcome."

Wixon also touched on the availability of march-in rights under the Bayh-Dole Act. He stated that no federal agency has ever exercised its march-in rights in the over thirty years of the Act's existence because that the use of such authority would have "chilling effect" on research and developments, resulting in a counterproductive effect. He also argued that the act of exercising march-in would not create a market where none exists and that it is therefore more important to create incentives to induce companies to address diagnostics.

Mark Rohrbaugh, National Institute of Health followed Wixon. He stated that the NIH has 56 licenses that relate to diagnostic products that could be identified (noting that some early years did not have complete information) and that most licenses were not exclusive. He acknowledged the existence of two active licenses, including one on the BRCA gene that was licensed exclusively to Myriad (after the 1995 settlement after the University of Utah had already exclusively licensed it out). He summarized the practice of exclusive licensing by the NIH, asserting that the NIH is more likely to grant an exclusive license where higher risks to development exist, but that the NIH always reserves the right to grant research licenses or can restrict use to a particular field. In granting exclusive licensing, Rohrbaugh stated that the NIH reserves such licenses for Class III (diagnostics) and Class II (where clinical trials are necessary). Additionally, Rohrbaugh noted that over the past few years, the NIH has begun to add language that requires independent third party confirmatory testing be made available when granting a license. He stated, however, that such language has come at a cost as some companies have refused to take such licenses.

Rohrbaugh, like Wixon, discussed the march-in process. He stated that in the thirty years of experience of the NIH, march-in rights are most useful as a deterrent. He argued that the existence of march-in rights can be used as a threat to force compliance, but voids the actual necessity in exercising march-in. He noted that in the context of diagnostics, one must consider the scope of the patent needed to practice the diagnostic test and whether the public health need could be addressed by granting only a license on the US government funded portion of the diagnostic.

Arti Rai from Duke University (though she was careful to note that she spoke in her own capacity and not on behalf of Duke) noted the policy relevance of the roundtable to today and that legislation to exempt injunctions may be possible. After mentioning the BRCA patents, she stated that federal funding is "significant" in some of the patents on Alzheimers, colon cancer, long QT syndrome and others. She also noted that in a survey of Athena Diagnostics, government funding was listed in 40 of the 93, but cautioned that not all universities have been conscientious in listing government funding or reporting the federal role in funding. She also highlighted the point that universities have not always engaged in best practices for licensing; while universities claim that they should engage in such principles, in practice universities often do not follow these practices.

Rai, addressing the march-in authority of the federal government, noted that it was a controversial provision. She noted that while previous speakers asserted that there may not be a market for secondary testing, there are many diagnostic areas where there is no need for the additional investment that kits require, giving the example of the physicians willing to perform the diagnostics at approved laboratories. She challenged universities to think better on the issues and stated that march-in may be appropriate because it can be calibrated to the specific situation or context (in contrast to a legislative solution) and could be used where no additional investment is necessary. Rai also criticized the "very cumbersome due process regulations" in the Bayh-Dole regulations which, she asserted, are not required by the language of the statute. She noted that it could be a far more expeditious process than current regulations require. Rai recommended continued thought on legislation (cautioning that such legislation should be relatively narrow, though less narrow than the original amendment proposed by Congresswoman Schulz) such as codifying an exemption from infringement and Congressional action directing federal agencies to "nudge" universities with march-in, and a change to the cumbersome regulations under the Bayh-Dole Act.

Hathaway Russell, Coalition for 21st Century Medicine, asserted that a legislative mandate requiring companies to license patents and allow confirmatory tests would seriously weaken the patent industry and businesses, thereby leading to an overall weakening in the field of diagnostics and personalized medicine. He stated that advanced diagnostics is at the core of medicine and critical at every stage of diagnosis and treatment. He posited that changes to the patent system will weaken diagnostics because companies would not have a reasonable expectation of return on investment. Russell asserted that duplication of tests is not cost-effective. He also suggested that tests can be designed around patents and that such avenues would be more beneficial to companies and to patients. He appeared adamantly opposed to any changes by the patent system, stating that "confusion over diagnostic tests" could not be fixed through legislative change to patents.

Sapna Kumar, University of Houston Law Center (like Rai, noted she was speaking on her own behalf rather than the University of Houston) argued that while the Constitution protects innovators, the Fifth Amendment protects consumers under the due process clause and asserted that gene patents violate the Fifth Amendment. She noted that patients have two fundamental rights: the right to knowledge and the right to make healthcare decisions. She pointed to three Circuit Courts of Appeals that have found a right to knowledge to make medical decision and a suggestion by the Supreme Court of the United States confirming such a right. She argued that genetic information is knowledge and an intrinsic part of the body and autonomy; she stated it was key to making informed healthcare decisions. Kumar argued that blocking or limiting genetic information, as gene patents do, violates the Due Process Clause. Kumar's proposed solution involves compulsory licenses which, she argued, would fix the fact that march-in rights have never been exercised. She also recommended that Congress formally codify a research exemption.

Robert Cook-Deegan, Duke Institute for Genome Sciences and Policy, stated that his institute had efforts underway to look at how patents can get in the way of genome sequences, with articles to follow. He suggested that two policy options existed short of creating a statutory exemption including: 1) companies having explicit policies about research use or confirmatory; and 2) setting collective norms and practices as an industry (but noting that enforcement mechanisms for violating such norms are weak). He suggested that the absence of research use or confirmatory testing could be the result of a lack of dialogue and noted that there could be common ground (but acknowledged that common ground may not exist). He noted that in order to do confirmatory testing, several questions must be answered including 1) whether the test is accurate (which is the easiest problem to solve if a test is found to have failures in finding mutations); 2 whether there are issues in the system of interpreting a particular result (for example, where it is clear a mutation exists, but dispute over the classification of the risk/significance) and asserted that parties should create rules on sharing data; and 3) whether a mutation could be taken and put into a model animal or yeast to study (noting that U.S. law would not permit this, but that it would be in everyone's best interests to permit such a research exemption).

Debra Leonard, College of American Pathologists, stated that pathologists have a keen interest in the ensuring that the ability of physicians to provide testing is not inhibited. She noted that gene-based clinical tests can be driven by a desire to provide the best care for patients and therefore would not need to be driven by patent incentives as some technologies require. She also stated that gene patents, unlike patents on clinical testing methods, cannot be invented around (refuting earlier speaker Russell's argument) and do not require the same incentives. Leonard noted that gene patents, when exclusively enforced or licensed, do not promote innovation and results in limiting patient access to care. She stated that such exclusive licenses also limits both new discoveries and training by pathologists across the U.S. She agreed that high quality personalized healthcare is necessary, but that gene patents inhibit such advancements. Leonard stated that patients should be empowered to access information, including second opinons, but restrictive licensing makes tests less available and affordable. She also rejected the notion that permitting labs to create tests solely for confirmatory purposes would adequately address the calls for secondary testing because the low volume of testing would not be worth it to the labs and that there would be a low quality of clinical lab testing due to low volumes of tests (noting test interpretation is improved where large volumes of data are available). Leonard called monopoly in the area of genetic diagnostic testing an "historical departure of pathology practice" which as preferred wide availability and testing. She noted that the current licensing practices reduces peer-reviewed evidence, harming both pathologists and patients. She called the prohibition from accessing one's own testing and genome a "de-personalization" of medicine. Leonard concluded with the recommendation that the statutory exception from infringement liability of surgeons and medical practitioners codified in 35 U.S.C. 287 be extended to pathologists.

Charis Eng, Cleveland Clinic Genomic Medicine Institute, largely focused her comments on the suggestion that testing should be performed by geneticists and genetic counselors. She suggested that non-genetic professionals over-order tests and do not properly interpret results. She agreed that second opinions are necessary, but suggested that it should only be geneticists and genetic counselors to interpret the tests. She also noted that insurance reimbursements become an issue because many insurance companies cover gene testing, but not genetic counseling. She therefore recommended proper insurance reimbursement for genetic counseling.

Bruce Quinn, Coalition for 21st Century Medicine, discussed insurance coverage of genetic testing. He noted that Medicare's published policies do not cover secondary or confirmatory testing. He noted that many insurance plans distinguish between the second opinion of a physician and a second or repeat test. Specifically, he noted that Medicare's published policy manual on paying for tests explicitly states that "Medicare does not pay for duplicate testing." He stated that BlueCross, Aetna and other insurance companies may only allow genetic testing of an inherited disease once in the lifetime of a patient. He stated that incentive gaps exist and that there is not enough evidence that supports a conclusion that insurance companies should pay for the confirmatory diagnostic test.

Beth Peshkin, National Society of Genetic Counselors, estimated that 940,000 BRCA mutation carriers live in the U.S., but only 5% of these persons have been identified, concluding that the granting and enforcement of patents in this area has impeded lifesaving tasks. She suggested that patents, when enforced to the letter of the law, increase costs of tests and that patients can be the "unwitting donors" of DNA information. Peshkin also noted that single testing is on the decline and medicine is shifting to multiplex testing or whole genome sequencing. She called on USPTO to build on past experience and learn from the BRCA patenting to improve access to testing. Peshkin noted an "unprecedented opportunity to avoid these barriers as we move toward the next generation of genetic testing" and made the following recommendations: 1) patients should be able to access the most comprehensive testing available; 2) the market should be made open and exclusive rights prohibited because currently, entire segments of the population are unable to undergo testing due to monopoly pricing; 3) research exemptions should apply; and 4) results of testing/data should be put in the public domain in order to ensure proper interpretation of resources (noting that much information is currently in proprietary databases). She acknowledged that patenting can provide positives for some parts of the population, but at the expense of others. She concluded that "gene patenting is a tax on the future of health at large and we as a society can ill afford such a tax."

Linda Bruzzone, Lynch Syndrome International, the final speaker for the first part of the roundtable, noted that every person in her family has contracted multiple lynch cancers by the age of 58 but that the current generation is living longer than the previous generations because of diagnostic testing. She stated that 600,000 people in the U.S. have Lynch Syndrome, but less than 5% have been diagnosed despite the fact that testing has been available since 1993. She recommended against confirmatory testing because it increases the cost of diagnosis. She also cautioned against the use of more genetic counselors because of a delay in availability of appointments, suggesting that such counseling be a choice rather than a requirement (arguing that negative connotations arise with required counseling). Bruzzone argued that there has been no significant research on the effect weakened patent system would have on genetic testing, but believes that it would result in reduced availability testing. She argued that USPTO should seek out the opinions of those with other genetic conditions and think cautiously about what appropriate recommendations may be.

The remainder of the speakers on the agenda all came from organizations or individuals that previously testified at last year's public hearing and included American Intellectual Property Law Association, Association of University Technology Managers, Biotechnology Industry Organization, Association for Molecular Pathology, MPEG LA. Their comments were similar to the ones made a year ago, the summaries of which can be found here.