Moderna, the maker of mRNA-1273, one of the leading COVID-19 experimental vaccine candidates, has attracted enormous attention from investors, society, and the press, not to mention from health authorities and governments around the world. Now they have new attention: allegations of intellectual property misdoing. Arbutus Biopharma (ABUS) has just challenged the Cambridge, MA-based company’s patents covering lipid nanoparticle (LNP) technology. mRNA-1273 is a messenger RNA-based vaccine, and LNP technology represents the underlying delivery system.
Moderna tried to argue in front of the U.S. Patent Trial and Appeal Board that the plaintiff’s claims are not worthy of patent protection, reports Investor’s Business Daily. The courts didn’t agree with Moderna and suggested that this Board “erred” in their decision. Moderna is now on record that “it may further pursue these matters.” However, this legal interaction doesn’t impede the full-throttle Phase 3 clinical trial.
Moderna submitted a written statement declaring, “Moderna is not aware of any significant intellectual property impediments for any products we intend to commercialize, including mRNA-1273.”
Enough investors appeared spooked by the recent events that their stock price dropped by 9.5% trading at $75.33 after the day’s close. Meanwhile, the small-cap Arbutus rose 119.9% to $6.29. At the time of writing off-hours, the price is $73.21.
SVB Leerink analyst Mani Foroohar suggests that Moderna, if it loses any court battles, would have to pay for its intellectual property in the form of royalties. Due to the over-dependence on the COVID-19 vaccine, the company is vulnerable: “Any meaningful royalty burden could hamper Moderna’s pricing flexibility and margin profile vs. other players in the SARS-CoV-2 vaccine market” suggested the analyst. The problem: this IP claim applies to Moderna’s entire pipeline. Perhaps the Moderna insiders were smarter than we know.