Text size
Maddie Meyer / Getty Images
Moderna on Thursday lost a patent case that had been almost entirely overlooked as the stock increased due to excitement over the company’s Covid-19 vaccine, which will be tested in a large Phase 3 trial to begin. next week.
What the decision issued by the Patent Evidence and Appeal Board on Thursday might mean for Moderna (ticker: MRNA) is still unclear, but the shares fell 9.5% on Thursday and fell another 5% on Friday in the pre-marketing trade.
“This legal dispute has been an ongoing debate among investors, and today’s decision is a disappointing turn for MRNA,” wrote SVB analyst Leerink Mani Foroohar on Thursday, who had previously started his coverage of the shares with a rating. from Market Perform. “In our view, this decision opens the door to a fascinating (and probably lengthy) period of investor controversy and debate around the implications of any potential claims infringement.”
In a statement Friday afternoon, Moderna said the technology used in its Covid-19 vaccine is not covered by the patent that its claim had been questioned.
Moderna filed the case in January 2019 against Arbutus Biopharma (ABUS), a very small biotechnology, arguing that its patent for the technology used to deliver messenger RNA to patient cells was not patentable. The patent concerns the use of so-called lipid nanoparticles, the molecules that Moderna and other messenger RNA specialists use in many of their drugs, including Moderna’s experimental Covid-19 vaccine, mRNA-1273.
In the ruling issued Thursday, an administrative patent judge found that Moderna had not shown that the patent claims were undetectable.
Theoretically, this could allow Arbutus to make royalty claims on Moderna’s drugs. In a statement to Barron’s, Moderna downplayed the importance of the ruling.
“To the extent that the PTAB is believed to have made a mistake in its decisions, Moderna can continue these matters,” the company said. “Moderna has invested in proprietary LNP delivery technology that we hope will enable us to fulfill our mission of creating a new generation of transformative medications for patients. Moderna is not aware of any significant intellectual property impediments to the products we intend to market, including mRNA-1273. “
Moderna released a second statement Friday afternoon that it had filed the lawsuit long before it began developing its Covid-19 vaccine, saying the technology in the lawsuit was outdated. “Moderna’s continued development of its proprietary LNP formulation technology and manufacturing processes have advanced far beyond the technology described in these Arbutus legacy patents,” the company wrote. “Our proprietary enhanced LNP formula, used to make mRNA-1273, is not covered by the Arbutus patents.”
After this article was originally published, Arbutus referred Barron’s to a presentation by the Security and Exchange Commission that he had presented on Friday morning, in which he said that the patent in question had been licensed to a company of which he is a part, called Genevant Sciences.
Arbutus has not said how he intends to proceed. It would have to take legal action to file any claim based on the decision issued on Thursday.
Arbutus’ stock rose dramatically on Thursday afternoon. The stock more than doubled in price, closing at $ 6.20, up from $ 3.38 that morning.
By Friday afternoon, Moderna’s shares had recovered somewhat, and were down just 2.6% on the day. Arbutus shares, meanwhile, had fallen to $ 5.44, down 12.3% on the day.
Moderna’s shares closed 285% so far this year. The company plans to begin the Phase 3 trial of its Covid-19 vaccine on Monday.
Write to Josh Nathan-Kazis at [email protected]
.
