[Ip-health] Patent Law/Science Article

[George M. Carter]

I believe this is an extremely important article and holds many key
concepts for transforming patent law. The current situation is beyond
untenable. While this reflects law in the United States, the unfortunate
ramifications of U.S. law internationally are pretty obvious to all.
Especially to those 8000+ people who will die today, in part arising from
the pernicious activities of the US Trade Representative, the United States
Congress and the Bush administration.

I look forward to hearing comments and thoughts about this article.
George M. Carter

****
30 MAY 2003
VOL 300:1375-1376
SCIENCE
POLICY FORUM

PATENT LAW
Natural Substances and Patentable Inventions

Linda J. Demaine* and Aaron X. Fellmeth
L. j. Demaine is a policy analyst with RAND, Santa
Monica, CA 90401, USA .A. X. Fellmeth is a practicing attorney.
*To whom correspondence should be addressed. E- mail: demaine@rand.org

The discoverer of a naturally occurring phenomenon-such as an element,
chemical, or mineral-cannot patent the phenomenon (1). This long-standing
principle of patent law, which reflects the "invention" prerequisite for
patent protection, has been upheld consistently by the U.S. Supreme Court.
Most recently, in Diamond v. Chakrabarty, the court noted that, although a
genetically modified organism could be patentable under some circum-
stances, "a new mineral discovered in the earth or a new plant found in the
wild is not patentable subject matter" because it is not "a product of
human ingenuity"(2).

Yet, subtly and without fan- fare, the prohibition on patenting products of
nature has fallen into legal desuetude. The Patent and Trademark Office and
federal courts now routinely hold discovered natural substances patentable
if they are "isolated and purified" or otherwise insubstantially modified
(3). Naturally occurring DNA and protein biomolecules have, consequently,
become the subject of thousands of patent applications (4). Although these
chemicals are the most common subjects of such patents, patents have been
issued on other purified natural substances, including metals (5),
extractions and secretions from microorganisms (6), vitamins (7), and
viruses (8). Still other natural substances are now equally susceptible to
patenting after isolation and purification, or other minor modification,
such as conversion from an ester to a salt or the addition of small amounts
of impurities (9).

What Is a Patentable Invention?
The central legal problem confronting the patent system with regard to
naturally oc- curring phenomena is how to distinguish them from patentable
inventions. The purpose of the Patent Act and Article I, Section 8, clause
8 of the Constitution is to promote the "useful Arts" by encouraging the
practical exercise of human ingenuity. The useful properties of natural
substances are created by nature, not their first discoverer. These
substances may have lacked a commercial or therapeutic use in their natural
forms, but having a practical use meets only the utility prerequisite for
patentability, which is distinct from the requirement that the claimed
product be the applicant's invention.

In the current patent law, then, there is an important and rarely discussed
lacuna. Courts have failed to interpret the Patent Act in a manner that
captures the prerequisite of human ingenuity to patentability where the
claimed product is based on a newly discovered, natural substance. It is
inappropriate, however, to examine whether the other, more often discussed,
requirements of patentability, such as novelty, utility, and
nonobviousness, are satisfied before properly determin- ing that applicants
are claiming more than a trivial modification of a natural substance.

The Substantial Transformation Test
The challenge is to craft a test to distinguish products of nature from
patentable inventions. A parsimonious solution is a variant of the
"substantial transformation test" (STT) used in customs law, in which a
product is considered to have undergone a substantial transformation when
it has a "new and dis- tinct name, character, or use." Because name is
highly mutable, the real focus of the test is a change of character or use.

The "use" component of the STT is very helpful in the biological sciences,
as shown elsewhere (10), but it is not general- ly relevant to elements,
chemicals, miner- als, subatomic particles, or other nonbio- logical
substances, because many of these substances, such as carbon, have numerous
ecological functions, and others, such as uranium, have no clear ecological
function. Moreover, a human-induced alteration of use may have no
transfonnative effect whatso- ever on a natural substance, because most
natural substances can be put to multiple human uses. For example,
Evangelista Torricelli, who invented the mercury barometer, surely merited
a patent on the barometer itself, but not on mercury, which has the same
character in a barometer that it has in nature. Instead of focusing on use
in chemistry and the physical sciences, the STT would concentrate on the
objective differences in character between the natural substance and the
claimed product, and on the sources of those differences.

"Character" in the STT is the aggregate of defining attributes that form
the identity of the product. In chemistry or mineralogy, the character of a
natural substance may be defined by its molecular structure, natural
properties (e.g., hardness, electrical conductivity, acidity, or
phosphorescence), reactive tendencies, or some combination of these. In
physics, subatomic particles may be better defined by their charge, energy,
mass, and behavior. Character should not be equated with just any attribute
of a product. To illustrate, pure copper can be polished to a reflective
shine, but this is not one of the defining attributes of copper's identity.
The character of a natural substance should be a question of fact to be
determined by the patent examiner, jury, or court, as appropriate, on the
basis of a consensus of the relevant scientific community.

The STT, as applied in chemistry and the physical sciences, would work in
practice as follows. The first inquiry requires the fact finder to assess
the respective characters of substance and the claimed product and whether
they are substantially different. If the characters are not substantially
different, the claimed product is unpatentable as naturally occurring. If
the characters are substantially different, the second inquiry asks whether
the claimed product's character was conceived by the patent applicant or is
inherent in the natural substance. For the purposes of this inquiry, the
inventiveness of the process of discovery, creation, or use is irrelevant,
as what is being claimed is a product. The process may be patentable, but
this has no effect on the patentability of the claimed product. If the
character of the claimed product was inherent in the natural substance, the
claimed product is unpatentable as naturally occurring. If, however, the
character of the claimed product originates in the applicant rather than in
nature, the claimed product is patentable subject matter.

Finally, if the STT's requirements are met, the claimed product must then
satisfy the remaining requirements for patentability, including utility,
and novelty and nonobviousness in light of prior art.

Examples of the Test's Application
Applying the STT to specific facts helps to clarify how it would
distinguish patentable subject matter from natural substances in difficult
cases. In one case from the 1930s, for example, an applicant sought a
patent on purified, crystalline alpha alumina. The patent was denied on the
basis of lack of in- vention (11). The examiner determined that the
applicant's product, which was slightly purer than the natural form of
alpha alumina and had "different sized or shaped voids," was not
particularly inventive, and the court upheld the examiner's decision.

Under the STT, this result was proper because the characters of the natural
and claimed alpha aluminas were not substantially different. They were both
crystalline, insoluble in water, and had good abrasive properties; compared
with these properties, the differences were trivial. The outcome might have
differed if the applicant had combined alpha alumina with another sub-
stance. For example, if the applicant had added hydrogen to produce alumina
trihydrate (ATH), the characters of the products would have been
substantially different, satisfying the first inquiry of the STT. ATH,
unlike alpha alumina, is an effective flame retardant and smoke
suppressant. Furthermore, these qualities would have been created by the
applicant's ingenuity, thereby satisfying the second inquiry of the STT,
because alpha alumina is not flame retardant (nor, certainly, is hydrogen!).

The case of pure titanium (5) offers an- other example. Titanium occurs in
nature in many combined forms, including rutile (titanium dioxide) and
ilmenite (iron titanium oxide). In determining whether the element titanium
is patentable over its naturally occurring combined forms, the first
inquiry of the STT is straightforward. Titanium's combined forms have
highly diverse characters, but none are like pure titanium, which is very
strong, has low density, and is noncorrosive; is ductile when pure, and
malleable when heated; and is the only element that burns in nitrogen. The
characters of natural titanium compounds and the claimed pure titanium are,
therefore, substantially different. The second, more difficult, inquiry is
whether pure titanium's character is created by some insight of the
patentee. Here, the answer should be negative. The patentee's insight is
that he could separate the elements of the natural compound and have
several substances, one of which was pure titanium. But the applicant does
not create titanium's character by this insight--it is inherent in the
element. Because pure titanium fails the second inquiry, the examiner
should not issue the patent.

In contrast, the invention of a new alloy of titanium would pass the STT if
the char- acter of the alloy were not simply the com- bined natural
characters of the individual ingredients. Thus, a nonnatural alloy of ti-
tanium and another metal, if the alloy has properties that none of the
naturally occur- ring ingredients has by itself, would not be considered a
product of nature, because the character of the alloy originated with the
inventor through artificial combination.

Whether concentrated root extract from a cube plant is patentable over the
cube root itself presents a final example (12). The root of the cube plant
is more or less like any root, but has mild insecticidal and vermicidal
properties. The extract (rotenone) is a fiberless solution having much
stronger insecticidal and vermicidal properties. The respective characters
of these products are sufficiently different to satisfy the STT's first
inquiry. Again, however, the character of the extract is inherent in the
root and was not created by any human ingenuity, there- by failing the
STT's second inquiry. Substantially altering the extract's character, such
as by adding significant bacteriostatic properties to the solution,
exogenously amplifying its insecticidal properties, or converting it into a
powerful fertilizer, would satisfy the STT's second inquiry.

Consequences of the Test
If adopted by Congress or the judiciary, the STT would maintain the patent
law's integrity while resolving many of the economic and ethical policy
concerns surrounding current patent practices.

Patents on natural substances needed for downstream research can impose
additional costs on, and sometimes preempt, fields of research (10). The
profusion of patents on natural substances diverts resources that could be
spent on research into ensuring noninfringement of registered patents,
paying license fees to upstream patentees, and conducting litigation over
the scope and applicability of such patents (13, 14). Often, natural
substances cannot be "invented around," so that a patent on a natural
substance confers the power to monopolize innovation in fields related to
the substance. Finally, fear of patent litigation or heavy license fees may
deter research, denying its benefits to the public.

Although the argument is commonly made that upstream research on natural
substances would occur at undesirably low levels without the incentive that
patents provide, the patent system is not designed to encourage upstream
research. Its constitutional purpose is to promote the progress of the
useful arts, meaning the practical application of science. In any event,
the inhibitive downstream effect of such patents may well outweigh the
benefit to upstream research. Moreover, patents are not the only incentives
for such research, which include government funding, trade secrets in
discoveries of natural phenomena, and public and professional recognition
of an important scientific contribution.

Noneconomic considerations also argue against issuing patents on isolated
and purified, or otherwise insubstantially modified, natural substances.
Such patents are thought by some to offend human dignity, or to represent
the unjustified privatization of natural resources that are the universal
heritage of humankind.

The STT addresses these issues by ensuring that products of nature,
recognizable as such, are not patentable subject matter.

References and Notes
1. For example, American Wood-Paper Co. v. Fibre Disintegrating Co., 90
U.S. (23 Wall.) S66 (1874).
2. 447 U.S. 303 (1980).
3. Fed. Regist. 66,1092 (2001).
4. M. Enserink, Science 287. 1196 (2000).
5. For example. U.5. Patent No. 5,204,057 (20 April 1993).
6. For example, u.s. Patent No. 4,231,938 (4 November 1980); u.s. Patent
No. 4,001,395 (4 January 1977).
7.  For example, U.S. Patent No. 5,426,248 (20 June 1995).
8. For example, U.S. Patent No. 6,355,246 (12 March 2002).
9. For example, u.s. Patent No. 4,059,437 (22 November 1977).
10. L.J. Demaine,A. X. Fellmeth, Stanford Law Rev. 55, 303 (2002).
11. In re Ridgway, 76 F.2d 602 (C.C.P.A. 1935).
12. Dennisv. Pitner, 106 F.2d 142 (7th Cir.1939),cert. de- nied, 308 u.s.
606 (1939).
13. National Institutes of Health, Report of the Working Group on Research
Tools (1998); available at www.nih.gov/news/researchtools/index.htm
14. M.A. Heller, R. S. Eisenberg, Science 280,698 (1998). 1 S. This article
was partially funded by the RAND Science and Technology Program.