Britain's highest court upheld a patent on a gene sequence held by Human Genome Sciences Inc related to its new lupus drug Benlysta, in a victory for the notion of patents on early-stage research.

Wednesday's UK Supreme Court ruling chimes with similar support for the patent by the European Patent Office (EPO) and overturns earlier British court decisions in favour of Eli Lilly & Co, which contested the patent. HGS had appealed against the earlier UK rulings.

The supreme court unanimously allows the appeal ... and remits the case to the Court of Appeal to deal with the outstanding issues, judge David Hope said.

The case centres on a protein called neutrokine-alpha, which HGS identified and filed a patent for in 1996, despite having limited idea how the discovery would be put to practical use.

After the original discovery of neutrokine-alpha, HGS worked with British drugmaker GlaxoSmithKline Plc to develop Benlysta, or belimumab, for the treatment of lupus, a chronic life-threatening autoimmune disease.

Benlysta, the first new treatment for lupus for 50 years, was approved by European drug regulators in July following a green light from regulators in the United States in March.

Justin Watts, a partner at law firm Freshfields Bruckhaus Deringer, which was not involved in the case, said the Supreme Court had come down on the side of encouraging confidence in early-stage investment in the biotech industry.

IN LINE WITH EUROPE

Following a challenge from Eli Lilly, lower courts in London originally decided the uses for neutrokine-alpha proposed in the HGS patent were not plausible at the time it was filed, since research had not at that stage been conducted to establish its industrial value.

But in his ruling, Hope said this was not consistent with the EPO's position, and the disclosure of the existence and structure of neutrokine-alpha and its gene should have been sufficient.

This has implications not just for bioscience but in other areas of blue-sky research like nanotechnology, smart materials and particle physics. Maybe we will see patents emerging in these areas over the coming years, Watts said.

Gareth Williams, a partner at law firm Marks & Clerk, said the judgement was also important for bringing the UK patent system into line with Europe, with the country's top judges deciding that European patent law should be followed unless there were very strong reasons to differ.

HGS, however, may not be out of the woods entirely as the Supreme Court did not consider another objection from Eli Lilly that the HGS discovery was too obvious to warrant a patent. This aspect of the case will now go back to the Court of Appeal.

Britain's BioIndustry Association, without favouring either side in the case, had made an intervention arguing against excessive hurdles for patentability and the trade body welcomed the Supreme Court ruling.

European biotechnology companies are concerned that onerous patent restrictions could disadvantage the sector.

Scientists and the biotech firms were alarmed last month when the European Court of Justice banned patenting any stem-cell process that involves destroying a human embryo, dealing a blow to an emerging field of medical research.

(Additional reporting by Kate Kelland; Editing by Hans-Juergen Peters and David Holmes)