Following our prior alert summarizing the oral arguments in REGENXBIO Inc. v. Sarepta Therapeutics, Inc., the Federal Circuit has now issued its opinion. On February 20, 2026, the Federal Circuit reversed the District of Delaware’s grant of summary judgment of patent ineligibility under 35 U.S.C. § 101, holding that the claims of U.S. Patent No. 10,526,617 (the “’617 patent”) are directed to human-made compositions of matter that are “markedly different” from anything found in nature. The Federal Circuit confirmed that genetically engineered host cells containing recombinant nucleic acid molecules are patent-eligible subject matter and patentability is not foreclosed by the natural phenomenon exception.

Background

As discussed in our prior alert, REGENXBIO Inc. and The Trustees of the University of Pennsylvania (“REGENXBIO”) sued Sarepta Therapeutics, Inc. and Sarepta Therapeutics Three, LLC (“Sarepta”) for infringement of the ’617 patent. The ’617 patent is directed to genetically engineered cultured host cells containing adeno-associated virus rh.10 sequences, a technology used in the development of gene therapy products. REGENXBIO accused Sarepta of infringement based on Sarepta’s use of the AAV variant rh.74 in cultured host cells to manufacture SRP-9001, a gene therapy product for the treatment of Duchenne muscular dystrophy marketed as ELEVIDYS in the United States. While the asserted claims do not cover ELEVIDYS itself, Regenxbio asserted patent infringement based on Sarepta’s use of the patented cultured host cell technology to make ELEVIDYS.

The district court had granted Sarepta’s motion for summary judgment, finding the claims ineligible under § 101 as directed to a natural phenomenon. In particular, the district court reasoned that the naturally-occurring components of the claimed recombinant cell (e.g., AAVrh.10 capsid sequence and the heterologous non‑AAV sequence) had not been changed from their naturally-occurring state, and that “combin[ing] natural products and put[ting] them in a host cell does not make the invention patentable under § 101.” The district court further wrote that “[t]aking ‘two sequences from two different organisms and put[ting] them together’ is no different than taking two strains of bacteria and mixing them together” as in the 1948 US Supreme Court case Funk Brothers Seed Co. v. Kalo Inoculant Co., 333 U.S. 127.

• The Federal Circuit’s Decision

Relying on the Supreme Court’s analysis in Diamond v Chakrabarty, 447 U.S. 303 (1980), the Federal Circuit reversed the District Court holding that the claimed host cells are patent-eligible compositions of matter as they are “markedly different” from anything found in nature.

• The claims are “Markedly Different” from Anything Found in Nature

The court noted that the claimed host cells include a recombinant nucleic acid molecule that “does not and cannot exist in nature.” Specifically, the claims require: (1) a “recombinant” nucleic acid, meaning segments of a nucleic acid from one source are artificially manipulated or inserted into the nucleic acid of another source through gene splicing; and (2) a nucleic acid molecule capable of encoding both an AAV rh.10 sequence and a “heterologous” non-AAV sequence, meaning a sequence from a different species. As per the Court, “the recombinant nucleic acid molecule must be spliced together via human intervention from at least two different species to meet the claim limitations.”

The Court drew a direct parallel to Chakrabarty, writing: “Like the man-made plasmid combining four naturally occurring bacteria in Chakrabarty, the claimed nucleic acid molecules here, although containing naturally occurring segments of DNA, are ‘not nature’s handiwork’ and ‘not . . . a hitherto unknown natural phenomenon, but . . . a nonnaturally occurring manufacture or composition of matter.’” Chakrabarty, 447 U.S. at 309–10.

• The District Court’s Funk Brothers Analogy was Flawed

The Federal Circuit squarely rejected the district court’s comparison of the claimed technology to the bacterial mixture in Funk Brothers. The court explained that “[g]enetically engineering two nucleic acid sequences from separate species into a single molecule and then transforming a host cell in order to incorporate that new molecule into it—thus fundamentally creating a cell containing a molecule that could not form in nature on its own—is materially different from growing more than one naturally occurring bacteria strain in a culture where none of the bacteria undergo any change from their natural state.”

• The District Court Erred by Focusing on Individual Components Rather than the Claims as a Whole

The Federal Circuit faulted the district court for taking “too narrow a view of the asserted claims by focusing on whether the individual components of the claim were markedly different from what is naturally occurring and failing to consider whether the claimed composition as a whole was ‘not naturally occurring.’”

The Court also declined Sarepta’s invitation to “disregard conventional limitations when considering whether claims are ‘markedly different’ from products of nature.” Per the district court, “it [is] inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the [§ 101] analysis.” As the Court stated: “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.”

• Alice/Mayo Step One Also Satisfied

Although the Court concluded its analysis could end under the Chakrabarty markedly different characteristics framework, it went on to address the Alice/Mayo two-step framework as an alternative basis for its holding. The first step of the Alice/Mayo framework addresses whether the patent claims are “directed to” an ineligible concept (i.e., a law of nature, a natural phenomenon, or an abstract idea). To be directed to an ineligible concept, the focus of the claims must be a patent-ineligible concept, as opposed to a technological process. If the patent claims are not directed to an ineligible concept, then the claims are patent eligible. The Court confirmed that “if resort to the Alice/Mayo framework is necessary, then at step one we conclude the asserted claims are not directed to a product of nature for the reasons stated above.” Specifically, the Court incorporated the full body of its markedly different characteristics analysis into the step one determination. That analysis established that the claimed host cells contain a recombinant nucleic acid molecule that “does not and cannot exist in nature” because it must be “spliced together via human intervention from at least two different species to meet the claim limitations.” Because the Court determined that the claims are not directed to ineligible naturally occurring subject matter at step one, it did not proceed to step two of the Alice/Mayo framework.

Key Takeaways

While this decision could potentially be reversed in future proceedings, it provides useful guidance for biotechnology and pharmaceutical companies that seek to patent genetically engineered compositions. When arguing patentability at the USPTO, Applicants should emphasize that the proper inquiry is whether the claimed composition as a whole (including any conventional components) is markedly different from what occurs in nature, not whether any individual component has been changed. Further, while structural differences alone may be sufficient to establish patent eligibility, patent holders should continue to ensure that their specifications clearly articulate the functional advantages of their claimed compositions as evidence of functional utility can further bolster the case for eligibility. Finally, it was a welcome surprise to see that the Federal Circuit pushed back on over-reliance on § 101, noting that breadth-related concerns may be addressed through other validity inquiries, such as novelty under § 102 and obviousness under § 103.

The case now returns to the District of Delaware for further proceedings.