On March 28, 2022, the Bench Trial with Judge Andrews began in the Case of: “United Therapeutics Corporation v. Liquidia Technologies, Inc.” (Case Number 20-00755 in the District of Delaware). The Bench Trial concluded with Closing Arguments on March 31, 2022, and following the conclusion of Post-Trial Briefing, we will then be awaiting the Court's Decision in this Case.
MDC Financial Research attended every day of this Trial and distributed multiple emails with our predictions and takeaways from the Trial; please contact us to discuss further. Note that this Case relates to United Therapeutics' Tyvaso® product, which According to United Therapeutics' most recent Form 10-K, accounted for approximately 36% of its revenue as of December 31, 2021. Given this, we currently believe that the outcome of this Case (and the related Inter Partes Review discussed below) will likely be a significant share-price catalyst for both United Therapeutics Corporation (UTHR) and Liquidia Corporation (LQDA).
United Therapeutics Corporation (UTHR) filed this Case on June 4, 2020. It alleged that Liquidia's New Drug Application #213005, which seeks approval to market a Dry-Powdered treprostinil product that is similar to United Therapeutics' Tyvaso® product (approved for the treatment of pulmonary arterial hypertension), is Infringing U.S. Patent Numbers: 9,593,066; 9,604,901; and 10,716,793. (The '793 was added in the First Amended Complaint - filed July 22, 2020.)
Due to adverse Claim Construction, United Therapeutics stipulated and agreed to Partial Judgment of Non-Infringement of the '901 Patent on December 28, 2021, and the Court Granted this Stipulation on January 3, 2022. In this Stipulation, the Parties write: "... based on the discovery in the litigation Plaintiff does not contend that Defendant’s current product infringes the ’901 patent under the Court’s construction of that term."
So the Bench Trial before Judge Andrews went forward in Wilmington, Delaware from March 28, 2022 to March 31, 2022 on just the ‘066 and ‘793 Patents. United Therapeutics is seeking an injunction and damages if Liquidia engages in any infringing sales.
On the following page is a Chart depicting the Patents and relevant expiration dates that United Therapeutics asserts in this Case:
|Patent Number||Expiration Date|
The 30-month Hatch Waxman Stay in this Case is currently set to expire on October 27, 2022, and we currently expect a likely Decision in this Case from Judge Andrews prior to that.
Please note that on June 4, 2021, United Therapeutics filed a Motion for leave to file an Amended Complaint adding claims of Misappropriation of Trade Secrets against Liquidia Corporation (LQDA) and additionally adding Dr. Roscigno (previously an employee of United Therapeutics and subsequently Senior Vice President for Liquidia) as a Defendant. This request for leave was Denied by the Court on November 17, 2021, with the Court citing the prejudice caused by adding a Defendant to the Case shortly before the commencement of the Trial as a reason for Denying this Motion.
The '793 Patent is also subject to an Inter Partes Review (“IPR”) at the Patent Trial and Appeal Board (“PTAB”) of the United States Patent and Trademark Office (“USPTO”). This is IPR2021-00406. Liquidia filed this Inter Partes Review against United Therapeutics' Patent on January 7, 2021. The PTAB then issued a Decision to Institute Trial on August 11, 2021. The Oral Arguments in this IPR were held on May 13, 2022, and MDC Financial Research listened to this proceeding live and distributed updates to clients of MDC Financial Research’s “Event-Driven Legal℠” investment-research service. We expect that a Final Written Decision in this IPR is likely to be issued prior to the PTAB’s August 11, 2022 deadline.
In this IPR, the Petitioner (Liquidia) contends that Claims 1–8 of the ’793 patent are unpatentable based on the following grounds (Pet. 30–68):
|Claim(s) Challenged||35 U.S.C. Section||Reference(s)/Basis|
|1-8||103||'212 Patent, Voswinkel JESC, Voswinckel JAHA|
|1-8||103||'212 Patent, Voswinckel JESC|
|1,3,8||103||Voswinckel JAHA, Ghofrani|
In the Table above, "35 U.S.C Section" 102 is for Invalidity by "Anticipation," and 103 is for Invalidity by "Obviousness."