Shares of Liquidia Corp (NASDAQ:LQDA) are sliding Thursday morning, extending a sell-off triggered by an adverse federal court patent ruling in its ongoing legal dispute with rival United Therapeutics. Here’s what investors need to know.
- Liquidia stock is feeling bearish pressure. Why is LQDA stock dropping?
Federal District Court Patent Ruling
The primary driver behind Thursday’s weakness is a ruling issued Wednesday by the U.S. District Court for the District of Delaware in ongoing Hatch-Waxman litigation between Liquidia and United Therapeutics.
The court ruled that claims 1 and 14 of U.S. Patent No. 11,826,327 are valid and infringed by Liquidia in connection with the marketing of Yutrepia for pulmonary hypertension associated with interstitial lung disease, or PH-ILD. The court found the remaining four claims asserted against Liquidia to be invalid.
The ruling therefore leaves two asserted claims of United Therapeutics’ patent intact while invalidating the other four claims at issue in the case.
Potential FDA Intervention And Market Restrictions
The court has directed the parties to submit a proposed form of final judgment, including proposed remedies, within one week. United Therapeutics has said it believes it is entitled to an order instructing the FDA to withdraw approval of Yutrepia’s New Drug Application. If such an order is granted, Yutrepia could potentially be removed from the U.S. market until the FDA approves labeling that omits the PH-ILD indication.
Liquidia said the exact remedy remains uncertain and that potential outcomes could range from removing PH-ILD from Yutrepia’s label to broader restrictions on product availability. United Therapeutics has requested injunctive relief that would restrict Yutrepia’s availability on the market.
Executive Commentary
Liquidia is preparing both legal and regulatory moves following the decision, according to CEO Roger Jeffs.
“We respectfully disagree with the court’s decision regarding claims 1 and 14 and are fully prepared to pursue all available appellate options,” Jeffs said. “As previously communicated to the court, we intend to submit a supplement to YUTREPIA’s New Drug Application to the FDA to remove PH-ILD from the label. Our commitment to patients remains unwavering.”
LQDA Shares Slide Thursday Morning
LQDA Price Action: Liquidia shares were down 14.64% at $25.83 at the time of publication on Thursday, according to Benzinga Pro data.
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