ABUS Stock On Track For Biggest Intraday Drop In Over 5 Years – What’s The Issue Around Its Patent In Europe?

• The verbal ruling was delivered on January 15, without written reasons, the company said.
• The company said it disagrees with the outcome and plans to seek a review by the Enlarged Board of Appeal once the written ruling is issued.
• The company does not expect the ruling to impact outcomes of its patent infringement cases against Moderna.

Arbutus Biopharma Corp. (ABUS) stock crashed more than 18% on Friday after the European Patent Office (EPO) revoked its patent following opposition proceedings brought by affiliates of Moderna and Merck.

This marked the ABUS stock’s biggest intraday decline since July 2020.

The verbal ruling was delivered on January 15 without written reasons, Arbutus said. The EPO ruling reverses two earlier decisions that had upheld an amended version of the patent EP 2279254. According to Google Patents, it covers “Novel lipid formulations for nucleic acid delivery.”

The company said it disagrees with the outcome and plans to seek a review by the Enlarged Board of Appeal once the written ruling is issued. Arbutus acknowledged that the decision could affect certain European legal actions against Moderna, including a case in Switzerland and a proceeding before the Unified Patent Court in which the patent is being asserted.

Moderna (MRNA) jumped 7%, while Merck (MRK) traded 2% lower.

Impact Outside Europe

Arbutus stressed that the revocation was based on the EPO’s “added matter” standard, which does not apply in other jurisdictions.

As a result, the company does not expect the ruling to impact the timing or potential outcomes of its patent infringement cases against Moderna in the United States, Japan, or Canada, a separate Unified Patent Court case not involving the patent, or its ongoing litigation against Pfizer and BioNTech in the U.S.

Retail Reaction

Despite the sharp intraday decline, retail sentiment on Stocktwits turned ‘bullish’ from ‘bearish’ amid ‘high’ message volumes.

One user sees the drop as an opportunity to take up fresh positions.

One user said it’s all noise and nothing has changed ‘other than the bad headline’.

The stock has gained around 20% over the past year.

Read also: Why This Penny Stock Is On Track To Gain For First Time In 10 Sessions

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