Liquidia Stock Plummets After Patent Infringement Ruling Favors United Therapeutics

Shares of Liquidia Corp. (NASDAQ: LQDA) plummeted Wednesday after a U.S. District Court in Delaware ruled that the company infringed on two patent claims held by rival United Therapeutics Corp. (NASDAQ: UTHR). The decision sent United Therapeutics' stock soaring, creating a stark divergence in market reaction to the pivotal legal outcome.

The Court's Decision

The court determined that Liquidia's YUTREPIA, an inhaled powder for treating pulmonary hypertension, infringed on claims 1 and 14 of U.S. Patent No. 11,826,327 held by United Therapeutics. These specific claims cover the treatment of pulmonary hypertension associated with interstitial lung disease (PH-ILD) using inhaled treprostinil, the active ingredient in YUTREPIA.

While the court upheld the validity of those two claims, it invalidated four other patent claims that United Therapeutics had asserted against Liquidia. The lawsuit was originally filed under the Hatch-Waxman Act, a federal law that governs generic drug approvals and related patent litigation.

Market Impact and Next Steps

Investors reacted swiftly to the news. Liquidia's shares cratered, falling by as much as 47.87%, while United Therapeutics' shares surged more than 13% in Wednesday trading.

Ad

The ruling is not the final step in the legal process. Both parties have been ordered to submit a proposed judgment, including potential remedies, to the court within one week. In its post-trial briefings, United Therapeutics requested injunctive relief, which could potentially limit or block the commercial availability of Liquidia's YUTREPIA.

Liquidia's Response

Liquidia has signaled its intent to fight the ruling. CEO Roger Jeffs stated the company disagrees with the court's decision regarding the two infringed claims and will "pursue all of our appellate options."

As a potential workaround, Jeffs also announced a strategic shift: "we intend to submit a supplement to YUTREPIA's New Drug Application to the FDA to remove PH-ILD from the label." YUTREPIA was approved in 2025 for both PH-ILD and pulmonary arterial hypertension (PAH). Removing the PH-ILD indication could potentially navigate around the infringed patents, though the company noted it cannot yet estimate the range of potential outcomes or its total financial exposure.