Broad Institute notches win in CRISPR patent battle

Dive Brief:

  • In a hotly anticipated judgment, the U.S. patent office on Wednesday ruled that key patents held by the Broad Institute of MIT and Harvard on the gene-editing technology CRISPR-Cas9 do not overlap with competing claims from the University of California (UC). 
  • The decision on the patent battle, which has captured the attention of the scientific community for months, sent the share prices for several biotechs tied to either side of the dispute spinning in opposite directions Wednesday afternoon. 
  • Shares of Editas Medicine, which licenses from the Broad, rocketed up nearly 29% while those of UC-aligned CRISPR Therapeutics and Intellia Therapeutics plunged before paring back initial losses. But Wednesday's decision may not have as clear cut an impact for the companies as the stock movements would suggest. UC may now receive a patent covering broader claims on the revolutionary tech. 

Dive Insight:

In Wednesday's decision, the Patent Trial and Appeal Board (PTAB) ruled the claims of UC and the Broad to be patentably distinct subject matter, leading the three judges to declare a judgment of non-interference. 

Put into layman's terms, the claims of the UC and the Broad are distinct enough so as to be separately patentable and therefore don't overlap with each other. This effectively supports the Broad's existing patents, while sending the UC's pending patent application back to the initial patent examiner. 

Some background: The Broad and UC (along with co-applicants University of Vienna and Emmanuelle Charpentier) have been disputing who should hold patent rights on the use of CRISPR-Cas9 to edit genes inside living cells. 

Although UC's team filed for a patent on that use before researchers at the Broad did, the Broad was able to speed up its application through the patent system and secures its patents first. Those patents, however, specifically covered the use of CRISPR-Cas9 in eukaryotic cells, such as those of humans and animals. UC's patent application, on the other hand, covered the use of the gene-editing tech in all cells, both eukaryotic and prokaryotic. 

The PTAB's decision Wednesday neither cancels nor finally refuses the claims patented by the Broad nor those claimed for patent by UC.

With the dismissal of the interference proceedings, UC's patent application will now be reviewed again by the patent examiner. UC believes it stands a good chance of being awarded a patent on CRISPR-Cas9 in all cells as the examiner had previously deemed its case to be "allowable." 

On a press conference following the decision, UC representatives expressed their optimism that UC could now receive a patent quickly.

That would lead to a seemingly contradictory result: UC with a patent on use of CRISPR in all cells and the Broad with a patent for use of CRISPR specifically in eukaryotic cells. 

If that were to happen, biotechs operating in the space could end up having to license the tech from both UC and the Broad. 

But CRISPR Therapeutics' CEO Rodger Novak, reached by phone after the decision, stressed that CRISPR Therapeutics would not be dramatically affected even with the decision going against UC. In the worst case scenario, Novak said, CRISPR would have to license use of the technology in eukaryotic cells. But if a broader patent were to be awarded to UC for use of CRISPR in all cells, CRISPR would be backed up by strong blocking intellectual property. 

Analysts from Jefferies believe cross-licensing — where CRISPR Therapeutics and Intellia license some uses from Editas and Editas licenses some technology from one of the UC-aligned biotechs — is a likely outcome. 

Investors initial push to sell off Intellia and CRISPR Therapeutics moderated as the trading day came to a close, leading to a upwards correction before market close. 

UC may also choose to appeal the PTAB ruling or move to settle with the Broad. In a statement, UC said it would "carefully consider all options for possible next steps in this legal process, including the possibility of an appeal." 

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