Why is Liquidia stock plunging? Yutrepia patent case explained

Shares of Liquidia Corporation plunged nearly 50% on September 30 after a US federal court ruled against the company in its long-running patent dispute with United Therapeutics. The ruling puts fresh pressure on the commercial outlook for Liquidia’s key drug, Yutrepia. (Sources: Reuters, Benzinga)

The US District Court for the District of Delaware found that two claims of United Therapeutics’ ‘327 patent were valid and infringed by Liquidia’s Yutrepia. The patent covers the use of inhaled treprostinil to treat pulmonary hypertension-associated interstitial lung disease, including certain dry-powder formulations.

Yutrepia is Liquidia’s lead product and was approved by the US FDA in 2025 for pulmonary arterial hypertension and PH-ILD. The court decision could affect its ability to compete in the PH-ILD market, depending on the remedies ultimately imposed. United Therapeutics’ Tyvaso is a competing inhaled treprostinil treatment.

Liquidia has said it disagrees with the ruling and plans to pursue available appellate options. The company also plans to ask the FDA to remove the PH-ILD indication from Yutrepia’s label. The court has directed the parties to submit proposed remedies within one week, with a final judgment expected shortly.

The ruling had the opposite effect on United Therapeutics. Its shares jumped more than 12% after the decision as investors assessed the ruling as strengthening the legal protection around Tyvaso. Liquidia’s shares, meanwhile, fell to their lowest level in nearly four months, putting roughly $3.18 billion of market value at risk if the losses hold.

(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)