The Broad Institute, a biological and genomic research centre affiliated with MIT and Harvard, will keep valuable patents on a revolutionary gene-editing technology known as CRISPR, a U.S. patent agency ruled on Wednesday.
The U.S. Patent and Trademark Office's Patent Trial and Appeal Board in Alexandria, Virginia, rejected a claim by a rival team, associated with the University of California at Berkeley and University of Vienna in Austria, that they invented the technology first.
The patent rights could be worth billions of dollars, as the technology could revolutionise treatment of genetic diseases, crop engineering and other areas.
Shares of Cambridge, Massachusetts-based Editas Medicine Inc (EDIT.O), a biotechnology firm that licenses CRISPR-related intellectual property from Broad, closed nearly 29 percent higher. Shares of Intellia Therapeutics Inc (NTLA.O), which has a licensing deal with the University of California, fell 9.2 percent.
Intellia said in a statement that it would work on legal strategy with the University of California, but that it was too early to comment on the next steps.
The University of California said on a conference call with reporters on Wednesday that it expected its own pending CRISPR patent application to be granted, and that the application covered a broader use of CRISPR than Broad's patents.
"At this moment, people will likely have to work with both institutions," Paul Alivisatos, UC Berkeley's vice chancellor for research, said on the call.
Lynn Pasahow, an attorney for the university, said his client had not decided whether to appeal.
Broad said it agreed with the decision, and Editas Chief Executive Katrine Bosley said the company was pleased.
CRISPR works as a type of molecular scissors that can trim away unwanted pieces of genetic material, and replace them with new ones. Easier to use than older techniques, it has quickly become the preferred method of gene editing in research labs.
In 2012, a research team led by Berkeley's Jennifer Doudna and Vienna's Emmanuelle Charpentier was first to apply for a CRISPR patent.
A team at Broad, led by MIT's Feng Zhang, applied for a patent months later, opting for a fast-track review process. It became the first to obtain a CRISPR patent in 2014, and has since obtained additional patents.
In April 2015, Berkeley petitioned the patent agency to launch a so-called interference proceeding, claiming the Broad patents covered the same invention as its earlier application.
Broad countered that its patent represented the real breakthrough because it described the use of CRISPR in so-called eukaryotic cells, which include plant and animal cells, for the first time.
The patent board's decision on Wednesday said there was "no interference in fact" between Berkeley's application and Broad's patents, meaning Berkeley's application can be granted. However, major commercial applications of CRISPR are likely to be in eukaryotic cells.
In addition to Editas - which was co-founded by Zhang and Doudna, who has since left the company - Broad has licensed its CRISPR technology to Monsanto Co (MON.N) and General Electric Co's (GE.N) medical technology subsidiary GE Healthcare.
(Reporting by Brendan Pierson in New York; additional reporting by Julie Steenhuysen in Chicago; editing by Bernard Orr and Richard Chang)