It is interesting - and it makes sense - the Tolkien may have taken his ideas on the creation of orcs from "Island of Dr. Moreau". Neither Wells nor Tolkein 50 yrs later would have had much understanding of genetic manipulation.
No one has yet brought up the spiritual side of this story. To me, it seems a metaphor for Christianity from a diest perspective.
Moreau is a god-like figure to the Beast People. He created them - or mutilated and altered them - into his own image. But none were "quite right", so he kept abandoning them and trying again. The Sayer of the Law is a priest-like character, and the Law itself reads like something out of Leviticus from the Bible.
Eventually Moreau was killed by his own creation, not surprising since he was torturing them to try to mold them into something they just weren't and could never be. Even when his reign of fear and pain was over, the other humans attempted to take Moreau's place as authority figures to keep the Beast People under control. They proclaimed, "He is not dead, keep the Law for when He returns". Nevertheless, the beasts gradually reverted back into animals, but they had been altered too much to ever truly return to their original selves. Their nature had been irreversibly changed.
This is similar to a Christian diest view in that God - for whatever reason - abandoned his charge to their own doings. Some people took up the place of authority to maintain control of the masses through now-irrelevant laws. Others wait indefinitely for His return. Others do not believe He will ever return or simply do not believe in the Law at all.