MORRISVILLE, N.C. - In a significant legal development, the United States District Court for the District of New Jersey has ruled in favor of Liquidia Corporation, a biopharmaceutical company, in its litigation against United Therapeutics (NASDAQ:UTHR) Corporation regarding the launch of a generic version of Treprostinil Injection, a drug used to treat rare cardiopulmonary diseases.
The court found that United Therapeutics' interference with the launch of the generic drug, developed by Sandoz (SIX:SDZ) Inc. and marketed by Liquidia's subsidiary, Liquidia PAH, resulted in losses exceeding $137 million. The decision, announced today, stems from a lawsuit filed in April 2019 by Liquidia PAH and Sandoz, which accused United Therapeutics of antitrust violations, unfair competition, and breaching a prior settlement agreement by restricting the use of cartridges necessary for administering the generic drug.
Dr. Roger Jeffs, CEO of Liquidia, expressed satisfaction with the court's decision, highlighting the harm caused not only to competitors but also to the healthcare system and patients who were denied a more affordable treatment option. The court's ruling on the damages caused by United Therapeutics' breach of contract will be offset by costs Sandoz avoided due to the breach, including amounts that would have been paid to Liquidia.
The damages awarded by the District Court are not yet final and may be subject to appeal by any of the parties involved. Under the agreement between Sandoz and Liquidia PAH, the proceeds from the litigation will be split evenly, but due to financing agreements with Henderson SPV, LLC, and PBM RG Holdings, LLC, Liquidia PAH will not retain any net proceeds.
Liquidia Corporation focuses on developing therapies for rare cardiopulmonary conditions and markets the generic Treprostinil Injection in partnership with Sandoz. The company also has other products in development, including YUTREPIA™ (treprostinil) inhalation powder and L606, a sustained-release formulation of treprostinil.
The court's decision is a significant step in Liquidia's ongoing legal battle with United Therapeutics and serves as a reminder of the complexities involved in pharmaceutical patent litigation and market competition. This article is based on a press release statement from Liquidia Corporation.
In other recent news, Liquidia Corporation has secured approximately $100 million in total gross proceeds for cardiopulmonary drug development. This sum includes $67.5 million from a public offering and private placement, and an additional $32.5 million from an amended Revenue Interest Financing Agreement with HealthCare Royalty. The funds will support the development of YUTREPIA™ (treprostinil) inhalation powder and other clinical trials.
In recent developments, Liquidia has initiated legal proceedings against the FDA over the agency's grant of a 3-year new clinical investigation exclusivity to United Therapeutics' drug Tyvaso DPI®. This exclusivity has delayed the approval of Liquidia's own treatment, YUTREPIA™. Amid these developments, analyst firms such as H.C. Wainwright, BofA Securities, Jefferies, and BTIG have adjusted their stock price targets for Liquidia, while Goldman Sachs (NYSE:GS) retained a Neutral rating for United Therapeutics.
Financially, Liquidia reported a decrease in revenue to $3.7 million in Q2 2024, down from $4.8 million in the previous year's quarter, but maintains a cash reserve of $133 million. These are the recent developments for both Liquidia and United Therapeutics.
InvestingPro Insights
In the wake of the court's ruling in favor of Liquidia Corporation, financial metrics and analyst insights from InvestingPro provide a deeper understanding of the company's market position and future outlook. According to InvestingPro data, Liquidia Corporation has a market capitalization of approximately $848.42M, which showcases its size within the biopharmaceutical sector. Despite the positive legal outcome, analysts have revised their earnings downwards for the upcoming period, indicating potential concerns about the company's profitability in the near future.
Moreover, Liquidia's stock has experienced significant volatility, with a 1-month price total return showing a decrease of 30.58%. This could reflect investor reactions to both the legal developments and the broader market perception of the company's financial health. Interestingly, despite the recent downturn, the company has seen a strong return over the last year, with a 1-year price total return of 51.86%, suggesting a resilient performance over a longer period.
InvestingPro Tips highlight that analysts anticipate a sales decline in the current year and do not expect the company to be profitable within this timeframe. These insights, coupled with the fact that Liquidia operates with a moderate level of debt, paint a complex picture for investors considering the company's financial trajectory. For those seeking additional insights, InvestingPro offers a total of 12 tips for Liquidia Corporation, which can be accessed at https://www.investing.com/pro/LQDA.
As Liquidia continues to navigate the competitive landscape of the pharmaceutical industry, these financial metrics and analyst insights will be crucial for stakeholders to monitor the company's performance and strategic direction.
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