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I read with interest this article outlining how a company and university have patented two human genes linked to breast and ovarian cancers. Now, the ACLU is suing Myriad Genetics (NASDAQ:MYGN) on the grounds that it is unconstitutional [to patent genes] and will inhibit innovation. I was also shocked to learn that about 20 percent of all human genes are patented, including genes associated with Alzheimer's, asthma and more. According to the article:

Myriad's patents give it exclusive right to perform diagnostic tests on the genes, forcing other researchers to request permission from the company before they can take a look at BRCA1 and BRCA2, the ACLU said. The patents also give the company the rights to future mutations on the BRCA2 gene and the power to exclude others from providing genetics testing.

This is rather far reaching. I interpret this as an out and out monopoly on human genes whereby Myriad can charge whatever outrageous royalty fee they so choose, thereby inhibiting innovation toward those targets.

How do I see this playing out as more genes are patented?

Well, if the trend continues and the frenzy for the discovery and subsequent patenting of various genes continues, rather than having several researchers at universities and companies all working toward cures for various maladies in parallel with the hopes that their actual compound or assay will assist in diagnosing or treating diseases, you may have just the patent owner for each particular gene working on innovations. This in turn means 1 rifle round instead of a shotgun approach of hundreds of innovators competing for the prize. When competition and innovation is stifled, we end up with a lack of medical progress and it is evident that the human genome (although lately, many are saying the new frontier is the proteome) is where the next wave of medical advances will come from.

Here's what a professor of bioethics said in the article, (well put):

"It's like trying to patent the moon," he said. "You didn't do anything to create it, just discovered something that already existed. You can't patent things that are publicly available, that anyone can find. You have to create something, make something, do something with the thing."

Source: Gene Patenting Will Hinder Biotechs and Drugmakers from Curing Maladies