Liquidia says court finds United’s interference caused losses over $137M

Liquidia Corporation announced that the United States District Court for the District of New Jersey has found that the interference by United Therapeutics Corporation with the launch of generic Treprostinil Injection caused losses in excess of $137M. Treprostinil Injection is manufactured by Sandoz and was launched as the first-to-file, fully-substitutable generic treprostinil for parenteral administration in March 2019. Liquidia PAH, a wholly owned subsidiary of Liquidia, partnered with Sandoz in August 2018 on an exclusive basis to market and commercialize Treprostinil Injection. The decision arises from the lawsuit filed in April 2019 by Liquidia PAH and Sandoz against United Therapeutics and another party in the District Court of New Jersey, in which Liquidia PAH and Sandoz alleged that United Therapeutics violated the Sherman Antitrust Act of 1890, state law antitrust statutes, unfair competition statutes and a prior settlement agreement between Sandoz and United Therapeutics by taking calculated steps to restrict and interfere with the launch of generic Treprostinil Injection. Specifically, Liquidia PAH and Sandoz alleged that United Therapeutics and another party entered into anticompetitive agreements whereby restrictions were placed on the cartridges necessary for the subcutaneous administration of treprostinil such that they could not be used for generic Treprostinil Injection. In March 2022, the District Court issued an order granting partial summary judgment to United Therapeutics with respect to the antitrust and unfair competition claims and granting partial summary judgment to Sandoz with respect to the breach of contract claim. After a trial, the District Court determined the damages caused by the breach of contract by United Therapeutics. Although the losses were determined by the District Court to be in excess of $137M, the final damage award has yet to be determined by the District Court and will be offset by amounts that the District Court has ruled were costs avoided by Sandoz as a result of the breach, including amounts that would have been paid to Liquidia. The District Court’s decisions can be appealed by any of the parties to the proceeding. Under the agreement between Sandoz and Liquidia PAH, all proceeds from the litigation will be divided evenly between Sandoz and Liquidia PAH. Under the litigation finance agreements that Liquidia PAH has entered into with Henderson SPV and PBM RG, any net proceeds received by Liquidia PAH with respect to the damage award will be divided between Henderson and PBM such that no net proceeds will be retained by Liquidia PAH.