Genetic Technologies takes back its "gift to the people of Australia"

A quick bit of news from my side of the world. An Australian company, Genetic Technologies, obtained exclusive Australian and New Zealand testing rights for the breast cancer genes BRCA1 and BRCA2 from Myriad Genetics back in 2003; amidst public furore about the prospect of increased costs to women of having these tests done, the company announced that it would refrain from enforcing the patent as a "gift to the people of Australia and New Zealand".

Now it's taking that gift back. On July 7, familial cancer screening laboratories around Australia and New Zealand received letters from the company ordering that they cease offering the tests within seven days. The people I've spoken to in these labs were shocked by the letter - there was no prior warning, and there's now considerable uncertainty about what will happen next. The concern, of course, is that this move will grant a complete monopoly to Genetic Technologies as the sole testing facility in the region, driving prices up.

It's likely that there will be legal challenges to the decision over the next few months, which I will follow with interest.

So why did Genetic Technologies make this move now, after five years of inaction? I'm not sure, but this graph from the Australian Stock Exchange sheds some light on the issue:

The red line tracks the drop in the price of Genetic Technologies shares over the last six months, relative to the overall performance of the Australian stock market over the same period in blue. It's also worth noting that Genetic Technologies has never actually made a profit. So perhaps the company feels that this move - which will certainly create a surge of negative publicity - is simply required to keep itself afloat.

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