U.S. court rejects Sequenom bid to restore prenatal DNA test patent

By Andrew Chung

NEW YORK (Reuters) - A U.S. appeals court refused on Wednesday to reconsider its decision invalidating a Sequenom Inc prenatal DNA test patent, a decision that could put in doubt the validity of a wide range of medical and biotechnology patents.

The U.S. Court of Appeals for the Federal Circuit in Washington said in June the patent was not eligible for legal protection because it fell under the U.S. Supreme Court's rule against patenting natural phenomena. That decision upheld a ruling by a lower federal court in California that cleared Roche Holding AG unit Ariosa Diagnostics of infringement.

Sequenom shares fell 9.5 percent to $1.62 on Wednesday. The company said in a statement it believed the ruling would have little business impact and vowed to appeal the decision to the Supreme Court.

Sequenom's patent relates to the discovery of a way to detect foetal DNA in a pregnant woman's blood to test for gender and genetic abnormalities, avoiding the risks of invasive medical techniques.

The June decision to cancel the patent, which acknowledged the test's "valuable contribution to science," was the latest to interpret two Supreme Court decisions from 2012 and 2013 that made it harder to obtain patents on naturally occurring substances and the tests used to detect them.

The company's bid to restore its patent was being closely watched by the biotech industry, which feared more medically vital patents would be at risk if the court's previous decision were not reversed. In court papers, Sequenom said it was an "existential threat" to patents and that investment in biomedical innovations would dry up.

Two of the 12 Federal Circuit judges who took part in a vote to deny rehearing appeared to agree with the concerns, saying the Supreme Court's precedents prevented them from finding the patents were valid.

"It is said the whole category of diagnostic claims is at risk. It is also said that a crisis of patent law and medical innovation may be upon us, and there seems to be some truth in that concern," Circuit Judge Alan Lourie wrote in an opinion on Wednesday.

In an interview, Ariosa attorney David Gindler praised the court's refusal to reconsider the case, saying it had faithfully applied Supreme Court precedent and that its decision "does not pose a threat to the patent system or anything else."

(Reporting by Andrew Chung; Editing by Andrew Hay and Peter Cooney)