Valorem Research's Lionel Hutz talks LQDA v. UTHR hearing at the Federal Circuit + argument review
Dec 11, 2023
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Valorem Research's Lionel Hutz discusses the Liquidia vs. UTHR hearing at the Federal Circuit. Topics include UTHR's arguments, judge performance, dissemination of abstracts, next steps post-hearing, and odds on outcome. Sponsored by Alphasense.
The Federal Circuit hearing focused on the patent infringement case between Liquidity and United Therapeutics, determining whether the PTAB ruling should be affirmed, reversed, or remanded.
United Therapeutics contested the prior art references and dosing information disclosed in the prior art, raising concerns about the validity of Liquidity's patent.
The judges explored the challenges of proving dissemination of prior art references and expressed concerns about the quality of circumstantial evidence provided.
Deep dives
The Federal Circuit hearing focused on the PTAB ruling and its implications for the commercialization of Liquidity's drug
The recent Federal Circuit hearing revolved around the Patent Trial and Appeal Board (PTAB) ruling on the patent infringement case between Liquidity and United Therapeutics. Liquidity had won the case at PTAB, but United Therapeutics appealed the decision. The hearing aimed to determine whether the PTAB ruling should be affirmed, reversed, or remanded. If the ruling is affirmed, Liquidity will be able to commercialize their pulmonary hypertension drug in 2024. If it is reversed, Liquidity will face an injunction preventing them from commercializing the drug. The outcome will have significant implications for Liquidity's business and the patent validity of their drug.
United Therapeutics argues against the prior art references and dosing information in the case
United Therapeutics focused its arguments on two main points. First, they contested the prior art references, specifically the Boswinkle, Jaskin, and Jaha references, and whether they were disclosed to the public and contained sufficient information to invalidate Liquidity's patent. Second, they raised concerns about the dosing information disclosed in the prior art and whether it was sufficient to make Liquidity's invention obvious. These arguments were central to United Therapeutics' case for reversing the PTAB ruling.
Liquidity's defense emphasizes the clarity of their arguments and the burden of proof
Liquidity presented a coherent and well-reasoned defense, focusing on the clarity of their arguments and the burden of proof. They argued that the prior art references were publicly accessible, sufficiently disclosed, and constituted prior art. They also emphasized that a declaration from a conference attendee was not necessary to establish the dissemination of the abstracts. Liquidity's defense highlighted that they met the burden of proof required for case law surrounding substantial evidence, supporting the validity of their patent.
Judges' response emphasizes the challenges of proving prior art dissemination
The judges in the Federal Circuit hearing explored the challenges of proving dissemination of prior art references, particularly in a case where a conference with 20,000 attendees was involved. They questioned the absence of a declaration from a specific attendee who received the abstracts, expressing concerns about the quality of circumstantial evidence provided. The judges recognized the tension between the evidentiary standard required and the lack of clear guidelines for proving dissemination in complex cases like this. The judges thoroughly examined the arguments presented by both sides and their impact on the validity of the patent.
Next steps: Possible outcomes and their probabilities
The possible outcomes of the case include an affirmance, a reversal, or a remand. An affirmance, where the PTAB ruling is upheld, is considered the most likely outcome with a probability of around 80-85%. A remand, where the case is sent back to the PTAB for further clarification or reconsideration, has a probability of around 10%. A reversal, where the PTAB ruling is overturned, is considered less likely with a probability of around 5-10%. The final decision will determine the fate of Liquidity's drug and have significant implications for the pharmaceutical industry.
Lionel Hutz, Editor of the Valorem Research Newsletter on Substack, joins the podcast today to discuss the Liquidia vs. UTHR hearing at the Federal Circuit that took place on Monday, December 4, 2023.
[1:35] What was the $LQDA hearing recently on Monday, December 4, 2023, and Lionel's initial thoughts on the hearing
[6:16] Arguments UTHR was drilling down on
[10:14] How Lionel thinks of the quality of UTHR's arguments
[13:56] Judge performance and thoughts on their performance during the hearing
[27:00] Question from Judge for LQDA about dissemination of abstracts / would we have this problem of dissemination if that conference was in 2023 vs 2004
[37:26] Next steps post-hearing: reversal or remanding, if remanding (sending back to the PTAB court) - what is the most likely issue, if reversal - what is the most likely reason
[49:02] Odds on outcome of the $LQDA hearing
Today's episode is sponsored by: Alphasense
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