However, not all are convinced. Many patent opponents believe patents actually stifle innovation through the "tragedy of the anticommons," that is the abundance of intellectual property rights makes research too legally complex or expensive.

But evidence of this has not been overwhelming. A National Academy of Sciences review of the effect of patent laws concluded that "IP restrictions rarely impose significant burdens on biomedical research." And an American Association for the Advancement of Science survey from 2006 and 2007 of about 5,000 scientists in the U.S., U.K., Germany and Japan found IP rights had "little negative impact" on scientific work, in the words of project manager Stephen Hansen.


Nonetheless, in the survey, a significant number of scientists, though mainly in industry and not the academy, said they were delayed by several months because of IP licensing headaches. But despite the hassles, few dropped their studies: according to a 2006 Nature Biotechnology article, only about one out of 100 scientists actually abandoned research because of the "patent thicket."

Investment impact

Although many expect widespread impact in the biotech industry as jittery investors pull out of biotech companies, so far reactions have been muted.

Isaac Ro, an analyst at Leerink Swann, a health care investment bank, tells DOTmed News that investors have known for months that this was a likely outcome, and are actually somewhat relieved.

"Classically, when you get a resolution to legal stuff, it resolves uncertainty, and that's usually a good thing," Ro says.

After taking a small tumble after the ruling was announced Monday, Myriad's stock rose a slight 1.48 percent on Wednesday, closing at $24.05.

Myriad itself claims it will do fine because of its other properties. "We do not believe that the final outcome of this litigation will have a material impact on Myriad's operations due to the patent protection afforded Myriad by its remaining patents," they said in a statement.

When contacted by DOTmed news, Myriad declined to comment.

For now, most biotech companies are not affected, as the District Court's ruling only applies to New York City and some counties north of the city, until and unless it gets affirmed on appeal when the case likely hits a federal appeals court sometime next year.




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