Bayh-Dole, From the Beginning. Enacted in 1980, Bayh-Dole was intended to promote the commercialization of government-funded research by allowing universities and other non-profits that receive federal grants—rather than the government itself—to own any resulting patents. This then-radical change in the law gave rise to the practice of technology transfer, whereby universities conduct sponsored research, patent the results, and then license the use of the patented inventions to spin-offs (which often involve the faculty inventors as principals) and other private companies.

Bayh-Dole contains two significant reservations of government rights, both intended to ensure that the patent owners actually do make use of government-sponsored inventions for the benefit of the public. First, the federal government retains a non-exclusive, non-transferable, royalty-free license to use the invention, a provision intended to permit further research by federal agencies. Second, and much more controversially, the federal agency that funded the research can “march in” and compel the granting of a license (or grant one itself) to “a responsible applicant or applicants” if the patent owner is not holding up its end of the agreement to use the invention for the benefit of the public.

Under Bayh-Dole and the accompanying regulations, there are several sets of circumstances that can trigger the agency’s march-in rights:

(1) The patentee and its licensees have not taken effective steps to achieve practical application of the invention and are not expected to do so within a reasonable time;

(2) The march-in license “is necessary to alleviate health or safety needs which are not [being] reasonably satisfied” by the rights-holders;

(3) March-in licensing is necessary to meet public use requirements specified by federal regulations; or

(4) Because the rights-holders have violated U.S. manufacturing preference rules, if applicable.

At first blush, the scope of possible march-in circumstances may seem reasonably broad. However, in more than three decades since its enactment, the NIH has only received march-in petitions four times (including Fabrazyme), and not once has the NIH exercised its march-in rights.

The Fabrazyme Petition and the NIH’s Response. In August 2010, a petition filed on behalf of three Fabry patients demanded that the NIH exercise these rights. Currently, the only effective, FDA-approved treatment for U.S. Fabry victims is Fabrazyme (agalsidase beta), an enzyme replacement produced from a recombinant mammalian cell line (i.e., a biologic). Fabrazyme—developed with NIH support—is manufactured by Genzyme under an exclusive license from Mount Sinai School of Medicine of New York University, which holds two patents, one of which is relevant to the petition. The petitioners pointed out that production was interrupted at Genzyme’s only manufacturing facility in mid-2009 because of contamination and other problems and that full production is not expected to resume until early 2011, with an increase in production possible only with the opening of a new plant projected for the end 2011. In the meantime, they and other Fabry patients have faced severe rationing, with their doses reduced by 70%; this is especially problematic because symptoms become worse if the dosage is reduced. Moreover, newly diagnosed patients are unable to get any Fabrazyme. This shortage, the patients argue, means that a compulsory license—what they call a non-exclusive “open” license—“is necessary to alleviate health or safety needs which are not being reasonably satisfied” by the rights-holders.

The NIH disagreed, and denied the petition (pdf) in a lengthy decision issued on December 2, 2010. The agency seemed to agree with all of the petitioners’ factual contentions about the shortage and its health impact. Nonetheless, it concluded that “a march-in proceeding under [Bayh-Dole] is not warranted at the present time because any licensing plan that might result from such a proceeding would not, in our judgment, address the problem identified by the Requestors.”

The primary basis for the NIH’s conclusion was that no competitor would be able to get a product to market before Genzyme solved the shortage itself. Specifically, “years of clinical studies and regulatory approval would be required before another manufacturer’s product could become available.” As evidence that there was no need for NIH-induced licensing, the NIH cited alternative Fabry drugs under development in Europe, Asia, and the U.S., none of which seems to hold much promise of alleviating the current acute shortage, and noted that a company seeking U.S. approval for a Fabry drug could take advantage of the Hatch-Waxman Act’s safe harbor from patent infringement for using a drug to prepare a government filing.

Finally, the NIH offered a practical rationale for its decision: “the information available shows that no supplier of an alternative enzyme replacement therapy has approached Mount Sinai or Genzyme to seek a license to supply such a therapy during the duration of the shortage.” If nobody has approached the rights-holders to request a license, the NIH reasoned, why should the government forcibly create one?

Will the NIH Ever March-In? On the one hand, the NIH’s position does make at least superficial sense: the odds are that no newly-licensed competitor could beat Genzyme in resolving the immediate supply problem. It is also consistent with the stance the agency has taken in denying three previous petitions where, in each case, it expressed concern about distorting the pharmaceuticals market. In decisions in 1997 (Baxter Healthcare/CellPro) and 2004 (Abbot Labs/Norvir and Pfizer/Xalatan), the NIH repeatedly stressed that intervention would upset investors’ settled expectations and thereby threaten future investment in university inventions. This, too, makes sense, at least as an abstract economic proposition.

But there are at least a couple of dubious aspects of the NIH’s decision in this case. The first problem is logical. Yes, no one is lined up to get a Fabrazyme substitute to market anytime soon. But no company will ever invest in developing a substitute for a patented drug until the patent runs out or it has a guarantee of a license (upon reasonable commercial terms). So the NIH’s logic has an element of self-fulfilling prophecy.

Second, has the NIH—so concerned about market distortion in its earlier decisions—now distorted the market in the other direction? That is, does the Fabrazyme decision, along with the NIH’s previous decisions, send a signal that there is no case in which the government would march in? If so, does that tell rights-holders that they can do whatever they want, ignoring their duty of reasonable satisfaction of health or safety needs?

By creating the march-in right, Congress expressed concern about the dark side of granting proprietary rights in publicly-funded technology. Does the NIH’s track record amount to a rejection of that concern?

Regardless of the topic, our readers are always curious about a possible Myriad connection. There is one here, but it is speculative at best. First, remember that the original genetic research that led to Myriad’s BRCA gene patents was government-supported. Next, suppose that the Federal Circuit reverses the district court and upholds Myriad’s gene patents, that the Supreme Court either agrees with the Federal Circuit (or declines to hear the case), and that Myriad continues to refuse to license its patents.

In that scenario, the current concerns about the cost of Myriad’s tests and patients’ inability to get second opinions would continue, and the issue would be even more politicized than it is now. It seems possible that the present plaintiffs, or people like them, would petition the government to march in and issue licenses to other testing companies. What would the government do? On the one hand, compulsory licensing would distort the market—especially from Myriad’s point of view. But on the other, the main practical reason the NIH gave for denying the Fabrazyme petition—the lack of ready, willing, and able licensee candidates—would go away. On the contrary, diagnostic testing companies would probably line up to take immediate licenses.

With much of the Myriad litigation still before us, a march-in scenario remains an extreme long shot. But should it some day arise, it could place an unprecedented degree of political pressure on the government to dust off Bayh-Dole and finally march in and exercise its rights.

The first is primarily a curiosity: the allegation that Chinese authorities are spying on deCode Genetics, Iceland’s most prominent genetic research company and provider of the direct-to-consumer genetic testing service, deCODEme. Nobody seems to know exactly what China is looking to gain by clandestinely exploring Iceland’s genetic genealogy. You are welcome to speculate in the comments.

The second raises broader issues: the revelation that the State Department’s ongoing human intelligence collection directives include requests for “biometric information” on key world leaders, including United Nations arms inspectors, the Director General of the World Health Organization (WHO) and key advisors and aides to United Nations Secretary General Ban Ki-moon. A separate cable detailing intelligence collection priorities in Africa’s Great Lakes region clarifies that “biometric information” includes “health [data]…fingerprints, facial images, DNA, and iris scans.”

Not disclosed in the WikiLeaked cables: why the State Department wants the biometric data or whether any have been successfully obtained.

Surreptitious Testing: An Overview. The cables are, however, a reminder that the law surrounding the surreptitious collection and testing of biometric data, including DNA, remains extremely murky.

While the extent to which surreptitious testing is performed in diplomatic and intelligence contexts is not publicly known, such testing is commonplace in law enforcement settings. For example, police routinely collect and analyze “abandoned DNA” during forensic investigations. Indeed, one of the primary indices of the FBI-run Combined DNA Index System (CODIS) is the Forensic Index. The Forensic Index is comprised of DNA profiles constructed from biological specimens from unidentified individuals collected at crime scenes. These DNA profiles are then compared against similar offender and arrestee indices, which are also housed in CODIS, to aid in law enforcement efforts. Several high-profile criminal investigations, including the recent arrest of the “Grim Sleeper” serial killer, have been aided by this technique.

Concerns about surreptitious sampling and testing have also appeared in other contexts. During this past summer’s Congressional hearing on direct-to-consumer (DTC) genetic testing, the Government Accountability Office (GAO) presented results from a series of undercover encounters with DTC companies. One recording appeared to show a company (later identified as Pathway Genomics) encouraging a prospective customer to collect and send in a saliva sample from her fiancé without his consent, in order to surprise him with results of a genetic test.

In 2009, New Scientist reporters Peter Aldhous and Michael Reilly used similar tactics to demonstrate that it was possible to obtain genetic information about someone without that individual’s consent and detailed their experiences in a special investigation: how my genome was hacked.

Shortly after the 2008 presidential election, an article appearing in The New England Journal of Medicine (NEJM) considered the possibility that, by the time the 2012 election rolls around, presidential candidates might be at significant risk of surreptitious genetic testing. The authors worried that “persons or groups opposing a candidate [and] hoping to harm his or her chances for election” would obtain and release genetic information without consent, a form of “genetic McCarthyism.” This would not be very difficult, the authors concluded, since “sufficient DNA for amplification and analysis can be obtained from loose hairs, coffee cups, discarded utensils, or even a handshake.” The WikiLeaks revelations about State Department officials seeking biometric information on world leaders indicate that the NEJM speculation may already be reality on the world stage.

There are numerous other scenarios in which surreptitious genetic testing might be employed to acquire information about less famous but equally unwitting individuals, including to establish paternity or to evaluate a potential romantic partner.

Legal Uncertainty Surrounds Surreptitious Testing. To many, it seems like “there oughta be a law” against surreptitious genetic testing, at least in certain settings. However, as reported last year by the Genetics & Public Policy Center, there are “limited legal safeguards against surreptitious DNA testing or its potential consequences for those subject to nonconsensual testing.”

While the 2008 passage of the Genetic Information Nondiscrimination Act (GINA) prohibits the unauthorized acquisition or use of genetic information in certain contexts (health insurance and employment), it offers only limited protection against surreptitious testing. For instance, while it covers most of the Federal government, including the State Department, GINA does not apply to the military or the VA. It also does not restrict behavior outside of the insurance and employment contexts including, for example, by political adversaries or their supporters during a presidential campaign. (Interestingly, the NEJM article declined to advocate for “laws that would make it a federal crime to sequence a candidate’s DNA without consent,” preferring voluntary restraints and education instead.)

Other Federal statutes, such as the Health Insurance Portability and Accountability Act (HIPAA) may offer protection under certain scenarios (e.g., the use and disclosure of genetic information by covered entities, predominantly health plans and healthcare providers) but, again, fall short of providing a complete and clear prohibition on surreptitious genetic testing.

The 2008 GPPC report also looked at state law to evaluate which states proscribe surreptitious DNA testing (pdf). Determining the exact number of states that prohibit this behavior depends heavily on context. Some state statutes prohibit unauthorized acquisition or analysis of genetic information, while others apply only to unauthorized disclosures. Similarly, some state statutes appear to encompass all manner of genetic information, whereas others cover only certain genetic information (e.g., health-related information) or apply only to certain settings (e.g., employment or insurance discrimination). The National Conference of State Legislatures (NCSL) has also compiled data on state genetic privacy laws and, like the GPPC report, the NCSL data indicates considerable variability at the state level.

In the absence of a comprehensive federal law, state prohibitions are currently the main source of relevant law when it comes to restricting surreptitious genetic testing. But not all states have such laws. Whether surreptitious genetic testing is illegal thus typically depends on a combination of who is doing the testing, whom they are testing, what they are testing for, how they are using the results and, most of all, the state or states in which those activities take place.

Finally, there is a possibility that surreptitious genetic sampling and testing may be prohibited on either common law or constitutional grounds, at least in certain situations. For example, in the Texas newborn blood spot litigation, which we covered earlier this year, the plaintiffs alleged both Fourth Amendment (unreasonable search and seizure) and Fourteenth Amendment (right to privacy) violations resulting from the state’s policy of retaining newborn blood spots for ongoing research without explicit parental consent. While both claims survived summary judgment, and may have helped precipitate the litigation’s settlement, these and other legal theories remain untested in most states and under most circumstances.

What We Should Learn From WikiLeaks. Coming full circle, the leaked State Department communiqués raise important questions to which we do not have clear answers. In particular: under what circumstances is the surreptitious collection of biometric data, including genetic data, appropriate?

For most, the answer to that question will depend to some degree on context. Should State Department officials gathering intelligence abroad have a greater or lesser ability to pursue surreptitious genetic testing than domestic law enforcement agents? Should private individuals be permitted to conduct surreptitious genetic testing in certain circumstances (e.g., to confirm paternity) but not others (e.g., when shadowing a politician or celebrity)?

While individual answers may vary, we expect the law to provide us with clear guidelines. As is made clear by the above analysis, however, there exists a wide range of scenarios where surreptitious genetic testing, should it occur, would fall squarely within a legal gray area.

This is in stark contrast to the situation in other countries. In the United Kingdom, for instance, the Human Tissue Act 2004 made it a “criminal offence to take a sample from someone to test their DNA without their consent, except for medical purposes and lawful investigative purposes” as of 2006. Similarly, while Germany’s new Human Genetic Examination Act (also known as the GenDG) is overly restrictive in many respects, § 8(1) of the GenDG (pdf) clearly prohibits “any genetic examination or analysis” without the “express, written consent of the subject person, both in regard to the respective genetic examination and genetic sample.”

Whether the United States adopts the same approach to surreptitious genetic testing or not, the issue must be addressed. We must articulate, much more clearly than at present, the situations in which unconsented genetic testing, analysis and disclosure is permissible, and those in which it is proscribed.

Each year, the availability of low-cost, high-quality genetic information expands. Along with a wide array of legitimate and beneficial uses, the growing accessibility of this genetic information brings with it an increasing number of opportunities to employ and to abuse surreptitious genetic testing. As we continue to push forward into the era of personal genomics, the time has come to seriously discuss a comprehensive legal framework for surreptitious genetic testing.

What’s Next for DTC? In last week’s post, we outlined several possible responses available to DTC genetics companies, including (1) pulling products from market, (2) agreeing to comply with FDA regulatory requirements, (3) modifying products to avoid FDA oversight or (4) challenging the FDA’s regulatory authority over DTC genetic testing products. We also noted the possibility that the FDA’s decision to look more closely at DTC genetic tests could presage increased scrutiny of the genetic testing industry more broadly, including the many tests currently offered without FDA clearance or approval as laboratory developed tests (LDTs).

With the personal genomics landscape shifting seemingly on a daily basis, what should we expect to happen next? Will the FDA follow up last week’s letters with letters to additional personal genomics companies, continuing its current policy of case-by-case regulation? Will it announce some form of industry-wide guidance? Will one of last week’s lucky recipients reveal its response to the FDA? Will we hear more from the Congressional committee investigating DTC genetic testing, which sent out its own letters nearly a month ago, then followed those up yesterday with another letter to 23andMe?

While we wait to see what tomorrow will bring, those interested in forecasting future chapters in the ongoing DTC regulatory saga are advised to take a look back at the FDA’s most recent attempt to shape the regulation of genetic testing.

A Complex Debate. Four years ago the FDA touched off a similar regulatory controversy when it ratcheted up its oversight of a specific type of high-complexity LDT: the in vitro diagnostic multivariate index assay or IVDMIA. On January 23, 2006, in a letter that bears remarkably similarities to the one sent just last month by the FDA to Pathway Genomics, the FDA invited Genomic Health, Inc. to discuss with the agency the regulatory status of its Onco type DX test, a complex genetic test designed to predict cancer recurrence in certain breast cancer patients. The FDA’s letter to Genomic Health was followed in September 2006 by draft guidance (pdf) announcing the FDA’s intent to regulate the entire class of genetic tests it deemed to be IVDMIAs.

The FDA’s initial proposal to regulate IVDMIAs was criticized as being vague, overly broad and unduly burdensome for genetic testing laboratories. The intense criticism resulted in the FDA’s publication of a revised guidance document in July of 2007 (pdf). That guidance was no less immune to criticism, and resulted in the FDA placing the proposed regulatory change on the back burner. Although the FDA has periodically indicated that IVDMIA guidance is still on the table, including earlier this year, it has now been nearly three full years since the FDA last took a meaningful public step in the direction of regulating IVDMIAs. (And, as described in Genomic Health’s most recent 10-Q (pdf), the Onco type DX test remains free from FDA regulation, at least for the moment.)

Why IVDMIA Matters. The history of FDA’s attempt to regulate IVDMIAs matters because it is almost certain to inform the FDA’s current attempt to regulate DTC genetic tests, as well as any attempts by the DTC genetic testing industry to resist that regulation. Most DTC genetic tests have long been considered, just like IVDMIAs, to be LDTs subject to the FDA’s enforcement discretion. In its letters to 23andMe, Knome and deCODE, however, the FDA argued that these tests do not qualify as LDTs because they are “not developed by and used in a single laboratory.” Even if that distinction holds, and DTC genetic tests are not determined to be LDTs, there is plenty to learn from the FDA’s experience with IVDMIAs.

Challenging the FDA’s Authority. Of particular interest are two petitions filed with the FDA concerning the agency’s proposal to regulate IVDMIAs, and its broader authority to regulate LDTs as medical devices. The first petition, filed by the Washington Legal Foundation (WLF) in 2006 (pdf), shortly after the FDA’s initial IVDMIA guidance was proposed, challenges the FDA’s legal authority to regulate LDTs (including IVDMIAs) and argues that the FDA’s approach of case-by-case regulation and informal agency guidance violated the agency’s responsibilities under the Administrative Procedure Act (APA). The WLF petition builds on a similar petition filed by the law firm of Hyman, Phelps & McNamara, P.C. (HPM) in 1992 (pdf) which challenged the FDA’s original assertion that it possessed the authority to regulate LDTs, even as it noted that it intended to exercise enforcement discretion and refrain from LDT regulation at that time.

The HPM petition, which was finally denied by the FDA nearly six years later, and the WLF petition are countered by a 2008 petition filed by biotechnology company Genentech, Inc. (pdf). Genentech’s petition argues that not only does the FDA have sufficient legal authority to regulate LDTs, but that given the potential risks to patient safety the agency should regulate all genetic tests, including all LDTs, rather than limiting its regulatory oversight to IVDMIAs.

If the FDA’s recent attempt to regulate certain DTC genetic testing products is challenged – whether by one of the five companies the FDA singled out or by some other third party – it is likely that many of the same arguments appearing in the HPM, WLF and Genentech petitions will reappear. In particular, questions about FDA’s authority to regulate these products, especially its ability to do so without undertaking notice and comment rulemaking pursuant to the FDA, are almost certain to play a prominent role. (As Kirell Lakhman of The Sample reported earlier this year, the need for APA-compliant rulemaking may be the reason that FDA’s proposed IVDMIA guidance remains on hold.)

While we can predict with some confidence what a challenge to the FDA’s authority to regulate DTC genetic tests might look like, it is far more difficult to predict whether such a challenge will ever actually be brought, let alone succeed. Such a regulatory challenge would be time-consuming and expensive – for both the challenger and for the agency – and, should it proceed into the courtroom, would be stepping into the relatively uncharted territory of consumer genetic testing.

A fight that entails such considerable expense and uncertainty is not one that any DTC genetic testing company will be eager to initiate. Still, for the companies and investors most directly threatened by the FDA’s recent activities, the history of the LDT/IVDMIA debate – and especially the regulatory silence that has followed – may be impossible to ignore.

This commentary in the Genomics Law Report’s ongoing series What ELSI is New? is contributed by George Church, Harvard Medical School.

One of the recurring themes in this ELSI series has been the discussion of open-access vs. research-only models for genomic research (see Bobe, MacArthur, McCarty, Prainsack and Sweeney). Below I discuss the characteristics and advantages of, as well as obstacles to, an open-access data model for genomic research.

A. Self-access: Open-access and freedom of information are increasingly required by law. Medical research is increasingly holistic — integrating a variety of (identifiable) traits and molecular signatures. Genomics is just part of this, not particularly exceptional. Multi-purpose cohorts and biobanks are displacing single trait studies. Research volunteers are increasingly expecting to see their own data and what is being doing with it. So with respect to such desired transparency, projects can be classified as ranging from 1) “no access” (HapMap, 1000 Genomes, dbGAP), to 2) limited access and no vetting exam (ClinSeq, CPMC and REVEAL), to 3) full access based on obtaining a 100% score on an exam covering risks of data sharing and re-identification (PGP).

B. Sharing: Since individuals can now easily get their medical and genomic data in digital form (outside of their actual “medical records” or any research project), and since individuals can have motivations to share these data, we can let this happen with or without scientific / non-profit / IRB guidance. If we choose the “without” route, then we will likely see Facebook / for-profit / non-IRB “DTC genomic research” proliferate. Projects that choose the “with” route, such as PGP, aim to set higher standards for how much knowledge citizens demonstrate about genetics and research before they give or receive data. The risks for both individual and society of sharing data are likely lower than many occupations (e.g. police and taxi) and possibly lower than the risks of “not sharing,” but those risks still need to be communicated and appropriate guidance provided (pdf).

C. Science: Access to information can be restricted via fees, legal threats, technological censoring (e.g. GPS and encryption algorithms), and study design (eliminating useful data linkages). What has been the impact of such restrictions on science, on serendipity, collaboration, interdisciplinary research, etc. in the past? Will computer experts, (with artists, writers, etc.) create user interfaces, de-mystifying huge case-control studies in open-access systems or in closed? Will physicists and chemists make whole systems biology models if they can only see part of the data (or none of it)? Will social scientists (with ethicists and policy experts) discover alarming (or hopeful) trends in open-access systems or closed? Do we really know in advance who will contribute and who will not? Will we prioritize access based on willingness to jump through bureaucratic hoops? Is that likely to maximize the number of creative interdisciplinarians or produce the biggest out-of-the-box analytic breakthroughs? This is not about mere inconvenience, it is about a series of totally missed opportunities. The predictable positive impact of open-access is huge, and add to that impacts far beyond what we can currently predict.

D. Politics:

1) Retroactive activism: One could argue that current case-control cohorts and biobanks have enough momentum that nothing new can compete. But monuments do topple. If enough volunteers request / demand their data, then there may be pressure to give it to them, no matter what the original contract said. Any claim that the data or cells are de-identified will be untenable, since past volunteers can inexpensively provide DNA identifiers (say 100 SNPs).

2) Proactive: More importantly, going forward, larger biobanks and cohorts will likely be the most useful and new recruits may increasingly migrate to the most transparent and scientifically exciting projects.

3) Reactive: The press and the public will react to efforts that permit people to publicly share their own data; but any criticism is likely to be much less severe than the backlash following the accidental (or intentional) release of multiple volunteers without their permission. Keeping secret data about people that they cannot access will perpetuate distrust of science. In contrast, celebrating volunteers willing to become informed and share their medical information might inspire the public in a manner like astronauts in the 1960s.