Biotech stocks are highly sensitive to patent disputes, with losing a patent or getting involved in a lawsuit often causing a significant decline in stock prices. This was recently witnessed with NuCana (NASDAQ: NCNA), which saw a 34% plunge in its stock price during Monday’s trading after facing patent-related issues.
NuCana’s troubles began when a European Union panel dismissed its claims for a European Patent, specifically patent number 2,955,190, which is related to a Hepatitis C therapy called sofosbuvir, owned by Gilead (NASDAQ: GILD). While NuCana had previously received support from two European Patent Office units — the Examination Division and the Opposition Division — the Technical Board of Appeal invalidated the patent, causing a sharp decline in NuCana’s stock price.
However, the good news is that NuCana’s cancer-fighting drug, ProTides, is not affected by the patent dispute, as it is covered by different patents. Hugh S. Griffin, NuCana’s founder and CEO, expressed disappointment with the outcome but emphasized that the company is well-capitalized, with multiple data announcements expected later in the year.
Apart from the patent dispute, NuCana’s stock prices have been volatile over the past five days, with some leveling off around $1.25 before the recent significant decline to around $0.80. However, a new floor now appears to be in place.
