RNA, DNA and the rising cost of IP management

A quiet revolution in identifying diseases is making IP management in molecular diagnostics increasingly difficult – and, ironically, threatens to undermine our ambition to make reliable testing for human ailments easily accessible to all mankind. The COVID-19 pandemic has made polymerase chain reaction (PCR) a household term as a gold standard test for the SARS-CoV-2 virus. But for about a dozen years, so-called syndromic PCR-testing has been on the march. Instead of testing for one pathogen at a time, syndromic testing looks for 50, 100 or even 250 pathogens in parallel in a sample to more quickly and surely identify the viral, bacterial or fungal causes of patients’ symptoms (or what doctors call “syndromes”).

Molecular testing is a young industry and patent protection abounds. When a so-called syndromic panel is ready for launch, IP experts have to secure patents for its innovations and assess the company’s freedom to make and market the new product without infringing on other companies’ IP rights. Freedom to operate (FTO) analyses for single-pathogen kits force an IP expert to wade through hundreds or thousands of patents approved and pending, and cost between $5,000 and $20,000. Multiplying that effort for 50 to 250 pathogens means FTO analyses for panels already cost up to $800,000, with the price tag rising rapidly.

More pathogens and patents

The problem for molecular-diagnostics companies is that FTO expenditures are rising towards levels that could threaten their products’ commercial viability (and the profits to fund the development of the next innovation). And there is no obvious way to escape a tyranny of numbers. Syndromic-testing panels covering new or more pathogens are likely to hit the market, while the number of patents to check against rises inexorably. From 2010 to 2019, the number of all patents in force worldwide jumped from less than 9 million to 15.2 million and patent applications from less than two million to 3.2 million every year.

Complicating this situation is the fact that patents at the molecular level are different from those on big, robust engineering products like car engines. Living materials made from DNA or RNA change continually – there were no SARS-CoV-2 pathogens and no mutations two years ago. That means the products that interact with them have to change too, making FTO monitoring a recurring task. Patent documentation is full of a willed linguistic fuzziness to help with this. Ambiguity is meant to make legal boundaries more flexible (and helps to keep competitors on their toes). But terminology becomes less precise than it could be.

IP experts could be overwhelmed

In research-heavy fields like blood diseases, these factors conspire to force IP experts to wade through hundreds of thousands of patent permits and applications when conducting FTO assessments. There are hundreds of thousands of patents relating to viruses like HIV, hepatitis B or hepatitis C – and adjacent areas made relevant by linguistic fuzziness. (In less popular areas, say for specific orphan diseases or in genetic sequencing, IP experts probably only have to contend with a few thousand patents.) The bigger the syndromic-testing panel, the more time and money are necessary – and the harder any decision about IP risks.

The molecular-diagnostics industry is moving towards a point at which its IP experts will be overwhelmed by the amount of information they can reliably process. Arguably, the IP sector is lucky that the US limits the problem by banning patents on natural genetic material (although those for synthetic genetic material were allowed in 2013). The EU, for its part, differentiates between essential and non-essential features and so also narrows the scope for court action: if a panel covers 250 pathogens and a single one infringes on the rights of one IP holder, so be it. But neither approach is a durable answer, as each one in effect keeps the FTO system running by curtailing or ignoring others’ intellectual-property rights.