The recent interim guidance issued by U.S. Patent and Trademark Office (USPTO) provides applicants and practitioners with more helpful information about which types of claims the USPTO will find to satisfy subject matter eligibility under 35 U.S.C. § 101. A notable change from its prior guidance focuses on whether a nature-based product claim, including a product-by-process claim, is directed to or recites a “product of nature” exception. This change will have significant implications for chemical, pharmaceutical, and biotech inventions.

The assessment, which an examiner carries out in Step 2A of the analysis flowchart, now compares the nature-based product in the claim to its naturally occurring counterpart in its natural state to determine if there are markedly different characteristics based on structure, function, and/or properties. Prior guidance was limited to structural differences alone.

Non-limiting examples of the types of characteristics considered by the courts when determining whether there is a marked difference include:

  • Biological or pharmacological functions or activities
  • Chemical and physical properties
  • Phenotype, including functional and structural characteristics
  • Structure and form, whether chemical, genetic or physical

Only when no marked differences are found is the judicial exception analyzed under Step 2B of the analysis flowchart: Does the claim recite additional elements that amount to “significantly more” than the judicial exception? This is a change from prior guidance because the inquiry as to whether the claim amounts to significantly more than a “product of nature” exception is not relevant to claims that do not recite an exception. Thus, a claim can be found subject matter eligible based solely on a showing that the nature-based product has markedly different characteristics, and thus, is not a “product of nature” exception, when no other exception is recited in the claim.

The markedly different characteristics analysis is applied only to the nature-based product limitations in the claim. The guidance explains that a process claim is not subject to this particular analysis for nature-based products used in the process, except in the limited situation where a process claim is drafted in such a way that there is no difference in substance from a product claim (e.g., “a method of providing an apple”).

An examiner may streamline the eligibility analysis of a claim that may or may not recite a judicial exception but, when viewed as a whole, clearly does not seek to tie up any judicial exception such that others cannot practice it. The interim guidance provides several representative examples:

  • A claim directed to a complex manufactured industrial product or process that recites meaningful limitations along with a judicial exception may sufficiently limit its practical application so that a full eligibility analysis is not needed.

  • A claim that recites a nature-based product, but clearly does not attempt to tie it up, does not require a markedly different characteristics analysis to identify a “product of nature” exception.

  • A claim directed to an artificial hip prosthesis coated with a naturally occurring mineral is not an attempt to tie up the mineral.

  • Claimed products that merely include ancillary nature-based components, such as a claim directed to a cellphone with an electrical contact made of gold or a plastic chair with wood trim, would not require analysis of the nature-based component to identify a “product of nature” exception because such claims do not attempt to improperly tie up the nature-based product.

To accompany the interim guidelines, the USPTO has published several examples of analysis for nature-based products. The examples find claims eligible that were said to be ineligible in earlier guidance, including product and process claims directed to gunpowder and pomelo juice. There are several additional examples of both eligible and ineligible subject matter relating to pharmaceutical compositions, methods of treatment, purified proteins, genetically modified bacteria, bacteria mixtures, nucleic acids, antibodies, cells, and foods.

The interim guidance does not add any clarity for claims directed to diagnostic methods and only addresses in its examples the claims at issue in Mayo Collaborative Services v. Prometheus Laboratories, Inc., decided by the U.S. Supreme Court in 2012.  Innovative diagnostic companies received a further set-back in the wake of the interim guidance release with the Federal Circuit decision in In re: BRCA1- and BRCA2-Based Hereditary Cancer Test Patent Litigation (also known as Myriad v. Ambry).  The court held multiple Myriad primer and detection method claims invalid for lack of subject-matter eligibility under 35 U.S.C. § 101 because of their breadth.  The court noted that the claims were not limited to specific mutations or purposes and thereby monopolized the basic building blocks of scientific research.

This alert is the second in a two-part series of Ballard Spahr alerts about the USPTO’s interim guidance. Our previous alert, issued on December 17, is available here.

Ballard Spahr’s Intellectual Property Department counsels clients on patent, trademark, unfair competition, copyright, trade secret, Internet, licensing, and trade dress matters. We offer strategic due diligence guidance to companies, universities, and investors during mergers and acquisitions or portfolio restructuring. We also work with early stage growth companies and entrepreneurs in commercializing their IP assets.

For more information, please contact Joseph P. Anderson III at 678.420.9448 or andersonjp@ballardspahr.com.


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