SAN FRANCISCO — In a case addressing the patentability of biological discoveries, a federal judge has disarmed a biotechnology company that was wielding a patent to block competitors from offering a new form of noninvasive prenatal testing.

In a 20-page order issued Wednesday, U.S. District Judge Susan Illston of the Northern District of California rejected a patent asserted by Sequenom Inc., agreeing with a rival that the patent combined the discovery of a nonpatentable law of nature and conventional scientific methods.

“The only inventive concept contained in the patent is the discovery of cffDNA, which is not patentable,” Illston wrote, referring to the use of cell-free fetal DNA in maternal blood as a way to screen for genetic disorders in place of riskier procedures like amniocentesis.

The dispute between Sequenom and Ariosa Diagnostics Inc. called upon Illston to wade into Section 101, a part of the U.S. Patent Act that explains which types of inventions can win the government’s approval. Recent U.S. Supreme Court decisions have transformed what was once settled law into a hot-button issue, legal scholars say.

Sequenom’s stock price fell more than 22 percent on Thursday. GC Robert Bowen said in an interview the company plans to appeal Illston’s decision.

“There’s an opportunity, because of the rapidly evolving nature of the law, for the courts to get it wrong,” he said.

Citing a long line of cases, Illston wrote that the question before the court was whether Sequenom added enough new steps to make the patent innovative once the discovery of the natural phenomenon was excluded. By applying techniques that were already widely used, the patent failed that test, Illston concluded.

The “unrebutted evidence” not only showed that the techniques were routine, she wrote, but that they were routinely applied, as in Sequenom’s patent, to detect DNA in serum or plasma.

Since rolling out its MaterniT21 test in 2011, Sequenom has litigated fiercely for control of what is estimated to be a $1 billion market. The company took an aggressive stance against those that followed. After receiving threats from Sequenom, the other three companies offering the tests—Ariosa, Verinata and Natera—filed suits for declaratory judgment that they had not infringed Sequenom’s patent. The suits were quickly met with counterclaims of infringement by Sequenom.

Sequenom sought a preliminary injunction to ban Ariosa’s sales of its test, which Illston denied. In an order compelling Illston to reconsider in August, the U.S. Court of Appeals for the Federal Circuit reasoned that either company could be bankrupted by the outcome of the litigation.

Sequenom lawyer Michael Malecek of Kaye Scholer did not respond to a request for comment. Ariosa lawyer David Gindler of Irell & Manella hailed Illston’s order.

“We lose the threat of one party trying to exclude everybody else from an important new technology that provides great benefits to pregnant women,” he said.

Gindler said the order ends his client’s feud with Sequenom, though Illston will still have to weigh in on the related patent disputes. Verinata has separately asserted five patents against Ariosa and Sequenom. Bowen said Sequenom is evaluating how to proceed with its suits against Natera and Verinata.

Illston wrote that her decision fit with a long tradition of Supreme Court decisions on the line between nature and invention, particularly Association for Molecular Pathology v. Myriad Genetics, which held that genes cannot be patented.

But the case may not have always been so clear-cut for Illston, who began an Oct. 11 hearing on Ariosa’s motion for summary judgment by saying that she was leaning toward Sequenom’s point of view.

“I have frankly gone back and forth and back and forth on what to do,” she said.

Gindler’s argument for Ariosa, emphasizing that Sequenom’s patent must be considered without the natural phenomenon, may have influenced the judge’s thinking.

Malecek conceded at the hearing that Sequenom’s patent, issued in 2001 and licensed exclusively from an arm of Oxford University, made use of standard techniques. But he argued that his client deserved to hang onto its patent because the Oxford scientists were the first to look for paternally inherited fetal DNA in the mother’s plasma or serum. Rather than breaking the patent down into its component parts, Malecek insisted that the contribution must be viewed holistically.

Illston wrote that even from that viewpoint, Sequenom’s patent did not contribute much beyond the original discovery. She also concluded the patent, if upheld, could have the undesirable effect of holding back other scientists from using the discovery of cffDNA in their work. Sequenom, Illston noted, had not demonstrated that there were other commercially viable methods for detecting fetal DNA in maternal blood.

“The Court concludes that the claims at issue pose a substantial risk of preempting the natural phenomenon of paternally inherited cffDNA,” she wrote.

Gindler said the case may prove instructive to other personalized medicine companies as they pursue and enforce their own patents. “This case provides a good example of the dangers of patents which tie up too much use of a natural phenomenon,” he said.

Contact the reporter at jlove@alm.com.