Arbutus Stock Drops 7% on European Patent Revocation

Key Developments

Arbutus Biopharma Corporation's stock experienced a 7% decline on Friday. This followed a verbal decision by the Board of Appeal of the European Patent Office (EPO) to revoke a significant company patent, EP 2279254.

Situation Overview

The ruling overturns two previous decisions that had upheld an amended version of the patent. The initial opposition was filed in April 2018 by affiliates of Moderna Therapeutics, Inc. and Merck, Sharp & Dohme Corporation. Arbutus has expressed disagreement with the outcome and intends to file a petition for review once the written decision is available in the coming months.

Impact on Market and Litigation

The patent revocation is expected to directly affect Arbutus's ongoing patent infringement lawsuit against Moderna in Switzerland. It will also impact one of two cases in the Unified Patent Court. However, Arbutus clarified that the EPO's decision was based on a specific standard of 'added matter' that does not apply in other legal jurisdictions. Consequently, the company does not anticipate any impact on its litigation against Moderna in the United States, Japan, or Canada, nor on its legal actions against Pfizer and BioNTech in the US.

Summary

While the European patent revocation has created a significant setback and immediate negative market reaction for Arbutus, the company has stated that the financial and legal impact is largely contained to specific European jurisdictions. The market will closely watch for the company's formal petition and the outcome of its unaffected litigation in North America and Asia.

FAQ

Q: Why did Arbutus Biopharma's stock fall?
A: The stock fell 7% after the European Patent Office announced the revocation of the company's key patent, EP 2279254, following opposition from Moderna and Merck.

Q: Does this decision affect all of Arbutus's lawsuits?
A: No. It is expected to impact cases in Switzerland and the Unified Patent Court, but not the company's litigation in the United States, Japan, or Canada.

Source: Investing.com