March 2026 The U.S. Court of Appeals for the Federal Circuit (“CAFC”) issued a precedential decision reversing a Delaware district court’s decision that had struck down REGENXBIO’s gene therapy patent claims as ineligible under 35 U.S.C. §101. The unanimous opinion reinstates REGENXBIO’s infringement action against Sarepta Therapeutics and clarifies how engineered biological constructs should be assessed according to US Supreme Court’s Decisions in Chakrabarty and Myriad.
Background
REGENXBIO and the Trustees of the University of Pennsylvania sued Sarepta for infringing multiple claims of U.S. Patent No. 10,526,617, which is directed to cultured host cells containing a recombinant nucleic acid molecule encoding an AAV capsid sequence together with a heterologous non-AAV sequence (i.e., a sequence from a different species).
The infringement proceedings centre on Sarepta’s use of the AAV variant rh.74 in the production of SRP9001, a gene therapy candidate for Duchenne muscular dystrophy. The claimed host cells were undisputedly human made, and the recombinant molecule at issue must be created by splicing together DNA from at least two species. As noted by the CAFC “It is uncontested that the claimed host cells include a recombinant nucleic acid molecule that does not and cannot exist in nature.”
District Court: Claims “Directed to a Natural Phenomenon”
Previously, the Delaware district court granted summary judgment for Sarepta, finding the claims ineligible under USC §101. It applied the “markedly different characteristics” test from Diamond v. Chakrabarty (“Chakrabarty”), reasoning that combining naturally occurring DNA sequences inside a host cell was no more transformative than the mixture of bacteria deemed ineligible for patent protection in Funk Brothers Seed Co. v. Kalo Inoculant (“Funk Brothers”).
The court further concluded that the claims lacked an inventive concept under the Alice/Mayo framework on the basis that they considered the claimed engineered host cell as being an assemblage of natural elements and thus unpatentable under USC §101.
Federal Circuit: Engineered Cells Are Not Nature’s Handiwork
The CAFC rejected the district court’s reasoning as “flawed and inconsistent with the undisputed scientific evidence in the record.” Thus the decision of the CAFC centres on their reconfirmation that the relevant legal test is whether the claimed composition as a whole possesses characteristics “markedly different from anything naturally occurring” as formulated by the US Supreme Court in Molecular Pathology v. Myriad Genetics, Inc. (“Myriad”).
We would particularly note from the CAFC’s analysis that:
- Human made recombinant molecules cannot occur naturally
The CAFC stressed that splicing together nucleic acid sequences from different species to create a recombinant molecule necessarily requires human intervention. Thus the applicable precedential decisions are Chakrabarty (engineered bacterium) and Myriad (cDNA). - Funk Brothers was misapplied in this case
Funk Brothers relates to mixed bacterial cultures wherein the bacterial strains are not modified. This is thus not comparable to the present case which relates to constructing a novel nucleic acid molecule and engineering a host cell to express it. The CAFC highlighted that the claimed compositions arise from fundamentally different process than the “unaltered bacterial mixture” in Funk Brothers.
- Claimed compositions must be assessed as whole
The CAFC criticised the district court for dissecting the claim into components and examining each in isolation. In particular, they cited Diamond v. Diehr (“[I]t [is] inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the analysis”) and stated that “we decline to read out or ignore limitations in a claim merely because they may be found in the prior art or within the knowledge of a skilled artisan.” Thus the CAFC follows US Supreme Court precedent that old and new elements alike form part of the analysis under USC §101. - The claimed compositions have undisputed utility
The CAFC also considered that the engineered host cells have “significant utility” for gene delivery and gene therapy applications (according to the test of Diamond v. Chakrabarty). The CAFC thus stated that “[i]t is undisputed (and touted in the specification) that, unlike isolated AAV rh.10 sequences and non-AAV sequences on their own, various embodiments of the claimed compositions “are beneficial for gene delivery to selected host cells and gene therapy patients.” [U.S. Patent No. 10,526,617, col. 25 ll. 58–62.] This is in stark contrast to the claims in Funk Brothers, which as the Supreme Court explained, recited a composition of matter that functioned no differently whether packaging the individual components together or separately.”
Conclusion
Following these points, and because the claims are not directed to a natural phenomenon, the CAFC did not proceed to step two of the Alice/Mayo test.
Thus the district court’s Judgment was reversed, and the case remanded back to the district court to now continue the infringement proceedings against Sarepta.
