Liquidia Corp. (NASDAQ: LQDA) shares fell 57% during Wednesday’s regular session after a federal court in Delaware ruled that the company’s lung drug Yutrepia infringes a patent held by United Therapeutics Corp. (NASDAQ: UTHR). Liquidia stock closed at $30.26 and edged up 0.13% after hours to $30.30.

United Therapeutics shares rose 12% to $540.54 after the ruling. Trading volume in Liquidia reached 22.95 million shares, nearly 19 times the stock’s average volume of 1.21 million shares.

The decision concerns a United Therapeutics patent covering methods for treating pulmonary hypertension associated with inter lung disease, or PH-ILD — a condition in which patients with interstitial lung disease develop elevated blood pressure in the lungs. The patent specifically addresses inhaled treprostinil delivered through dry-powder formulations, the method used by Yutrepia.

The Delaware court ruled that two claims in United Therapeutics’ patent were valid and infringed by Yutrepia, while finding other asserted claims invalid. The court also rejected Liquidia’s motion to strike evidence related to United Therapeutics’ ownership of the patent. The judge said Liquidia had received sufficient notice before trial and had not raised its objections in time.

Potential impact on Yutrepia

Liquidia said it could not yet estimate the financial impact of the ruling because the outcome will depend on any appeals and subsequent court proceedings. Potential remedies could include removing the PH-ILD indication from Yutrepia’s label or imposing tighter restrictions on the drug’s sale.

United Therapeutics has asked the court for an injunction that would limit Yutrepia’s availability. The two companies are required to submit proposed judgments within a week, with a final decision on remedies expected around that time.

Liquidia Chief Executive Officer Roger Jeffs disputed the court’s conclusions regarding two patent claims. “We respectfully disagree with the Court’s decision regarding claims 1 and 14 and are fully prepared to pursue all available appellate options,” he said.

Jeffs also said Liquidia would submit a supplement to Yutrepia’s application with the U.S. Food and Drug Administration. The company intends to remove the PH-ILD indication from the drug’s label entirely.

Yutrepia was approved in 2025 for two uses: pulmonary arterial hypertension and PH-ILD. The PH-ILD indication is the portion of the product’s approval now affected by the patent dispute, and removing it would leave the drug approved solely for pulmonary arterial hypertension.

Analyst reactions and market data

Analysts differed in their assessment of the ruling’s broader implications. Raymond James analyst Ryan Deschner said the court’s rejection of Liquidia’s evidence motion was a negative sign for the company’s broader case. Leerink Partners characterized the decision as favorable to United Therapeutics because the court found that Yutrepia infringes a valid patent. RBC Capital analyst Lisa Walter said the ruling creates uncertainty around Yutrepia’s ability to compete in the market.

The ruling also strengthens protections around United Therapeutics’ inhaled treatment Tyvaso, the branded inhaled treprostinil therapy that Yutrepia competes against. Liquidia shares reached their lowest level in nearly four months after the decision. If the decline holds, the company could lose approximately $3.18 billion in market value.

Liquidia’s Relative Strength Index was 20.23, a level commonly described as oversold. The shares were trading near 12% of their 52-week range. Despite Wednesday’s decline, Liquidia stock remained up 33% over the previous 12 months. The company’s market capitalization stood at $2.71 billion, compared with a 52-week high share price of $93.61.

The original report is available from CoinCentral. Related reporting was published by Reuters.