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E. Richard Gold is James McGill Professor, McGill University, Faculty of Law and Faculty of Medicine

With the U.S. Supreme Court ruling this week that nobody can get a patent on a snipped-out human gene, Canada is falling behind. Investors will wonder whether similar Canadian patents are valid while Canadian hospitals and laboratories fear being sued if they offer Canadians potentially life-saving genetic tests. These questions were addressed in the U.S., Europe and Australia through a test case. It is time to have one here.

Thursday's decision revolved around a patent over the 'Angelina Jolie' genes, BRCA1 and BRCA2, a mutation in which can significantly increase a woman's chance of contracting breast or ovarian cancer during her life. The court ruled that simply claiming the natural genetic sequence 'isolated' from other cellular materials is not enough to qualify for patent protection. Combined with lower court rulings that merely comparing a woman's genetic code to a standard is also not good enough to get a patent, the result is that clinics throughout the U.S. can now provide women and men with genetic screening for those genes and a slew of other genes without fear of being sued for patent infringement. On the other hand, more constrained patent claims that underlie therapeutic development were left intact.

While there are likely to be some who lament this development, history suggests that there will be no negative effect on research and development. After all, the biotech industry cried wolf before when the Canadian Supreme Court ruled that nobody can patent whole animals or plants. Despite various apocalyptic prophesies, not a single Canadian company left the country or lost out on an opportunity due to that ruling. They simply adjusted and moved on. The same will inevitably happen after this decision, although there may be a period of adjustment during which investors act more cautiously. This will be compensated, however, by the increase in innovation unleashed through giving laboratories more freedom to use the once-patented genes.

The major outcome of this decision for Canadians is that we face the worst of all worlds. Which investor will assume that the Canadian courts – which have never confronted this issue – will offer patent protection where the U.S. does not? Which cash-strapped hospital or public laboratory will assume that Canadian patents are invalid? Both investors and hospitals will assume the worst, leaving Canada in a precarious position of short-term decreases in investment with no compensating increased use by hospitals and laboratories.

Canada needs to resolve the uncertainty. Parliament has been shy in updating our patent laws to deal with the new realities of biomedical research. The patent office – the branch of government with the most expertise in the area – has been gutted by court decisions of any policy-making role. Courts can only rule on the issue if presented with a case. Since public hospitals and labs have few resources to defend against a threat of patent infringement, they have simply stayed away.

(Ironically, the only patented genes tested for in Canada are those relating to BRCA1 and BRCA2 because of a fight led by the Harris government of Ontario in 2001 and 2002.)

The uncertainty is getting in the way of Canadian health care. One of the ways in which our system is more efficient than that of the U.S. is that the centralization of our public laboratories encourages the combination of and innovation in genetic tests. Patents over genes get in the way. Instead of testing for a panel of many genes in Canada, we pay to get individual genes tested in the United States. This not only costs more, but delays treatment and fails to generate the innovation that our laboratories have proven they can do so well.

Assuming that Parliament does not intervene, either on this particular issue or to empower the patent office to make policy decisions in this area, the only way to resolve the uncertainty is through the launch of a test case. It is the route used in Europe, the U.S. and Australia (all with respect to the BRCA1 and BRCA2 genes) to get clarity on the issue. It is the way forward for Canadians.