Enanta Pharmaceuticals to Appeal Ruling Related to ‘953 Patent Infringement Lawsuit

Rhea-AI Summary

Enanta Pharmaceuticals (NASDAQ: ENTA) announced that the United States District Court of Massachusetts has ruled against them in a patent infringement lawsuit against Pfizer. The Court granted Pfizer's summary judgment motion, declaring Enanta's '953 Patent invalid. This patent was related to Pfizer's COVID-19 antiviral, Paxlovid.

The Court also denied Enanta's partial motion for summary judgment of infringement. Enanta plans to appeal the decision to the Court of Appeals for the Federal Circuit. Despite the ruling, the company maintains its commitment not to impede Paxlovid's production, sale, or distribution.

Positive

• None.

Negative

• Court ruled Enanta's '953 Patent invalid in lawsuit against Pfizer
• Lost potential damages from Paxlovid patent infringement claim
• Motion for summary judgment of infringement denied

Insights

Patent Law Expert

This ruling represents a significant setback for Enanta Pharmaceuticals in their patent dispute with Pfizer over Paxlovid. The District Court's invalidation of the '953 patent on summary judgment is particularly noteworthy, as it didn't even require a full trial. The decision to invalidate rather than just rule on non-infringement suggests fundamental issues with the patent's validity claims.

The appeal to the Federal Circuit will face considerable challenges. Federal Circuit reviews patent validity determinations de novo, but gives deference to underlying factual findings. Historical data shows that patent invalidity decisions at summary judgment are upheld approximately 70% of the time on appeal. The timeline for such appeals typically spans 12-18 months, during which Paxlovid sales will continue unimpeded.

For retail investors, this significantly diminishes the prospect of Enanta receiving substantial damages or future royalties from Pfizer's Paxlovid sales, which generated over $18.9 billion in 2022. The commitment to not impede Paxlovid production suggests Enanta's strategy is purely focused on monetary compensation rather than injunctive relief.

Financial Analyst

The market implications of this ruling are substantial for Enanta, whose current market cap of $132.8 million reflects investor uncertainty about the patent litigation outcome. The loss of potential Paxlovid-related revenue streams materially impacts Enanta's financial prospects. A successful patent claim could have resulted in significant damages given Paxlovid's massive commercial success.

The company's financial position becomes more dependent on its clinical pipeline progress, particularly in RSV and hepatitis B programs. With $166.1 million in cash and investments reported in their last quarterly filing, Enanta has runway to pursue the appeal process without immediate financial pressure. However, the stock may face downward pressure as the market prices out the probability of a successful appeal and potential Paxlovid-related revenues.

WATERTOWN, Mass.--(BUSINESS WIRE)-- Enanta Pharmaceuticals, Inc. (NASDAQ: ENTA), a clinical-stage biotechnology company dedicated to creating small molecule drugs for virology and immunology indications, today announced that the United States District Court of Massachusetts (“the Court”) has issued a ruling on a summary judgment motion filed by Pfizer, Inc. in connection with Enanta’s patent infringement lawsuit seeking damages for infringement of U.S. Patent No. 11,358,953 (“the ’953 Patent”) in the manufacture, use and sale of Pfizer’s COVID-19 antiviral, Paxlovid™ (nirmatrelvir tablets; ritonavir tablets).

The Court issued a summary judgment decision granting Pfizer’s motion that the ‘953 Patent is invalid. In its decision, the Court also denied Enanta’s partial motion for summary judgment of infringement as moot in light of its allowance of summary judgment on invalidity. Enanta plans to appeal the decision to the Court of Appeals for the Federal Circuit.

"The U.S. patent system and its protection of important innovations have enabled the robust development of new medicines and spurred growth in the biotechnology industry. We are proud of the impact our strong history of drug discovery work with protease inhibitors has had on antiviral treatments and the thousands of patients that have been treated with therapies using our patented inventions,” said Jay R. Luly, Ph.D., President and Chief Executive Officer of Enanta Pharmaceuticals, Inc. “We are disappointed with the Court’s ruling. We believe strongly in the merits of our case, and, through the appeal process, we will continue to defend our inventions from unlawful infringement.”

Enanta maintains its commitment to avoid attempting to impede the production, sale or distribution of Paxlovid.

About Enanta Pharmaceuticals, Inc.

Enanta is using its robust, chemistry-driven approach and drug discovery capabilities to become a leader in the discovery and development of small molecule drugs with an emphasis on indications in virology and immunology. Enanta’s clinical programs are currently focused on respiratory syncytial virus (RSV) and its earlier-stage immunology pipeline aims to develop treatments for inflammatory diseases by targeting key drivers of the type 2 immune response, including KIT and STAT6 inhibition.

Glecaprevir, a protease inhibitor discovered by Enanta, is part of one of the leading treatment regimens for curing chronic hepatitis c virus (HCV) infection and is sold by AbbVie in numerous countries under the tradenames MAVYRET® (U.S.) and MAVIRET® (ex-U.S.) (glecaprevir/pibrentasvir). A portion of Enanta’s royalties from HCV products developed under its collaboration with AbbVie contribute ongoing funding to Enanta’s operations. Please visit www.enanta.com for more information.

Forward-Looking Statements

This press release contains forward-looking statements, including statements with respect to Enanta’s suit against Pfizer, Inc. in the United States District Court for the District of Massachusetts seeking damages for patent infringement. Statements that are not historical facts are based on management’s current expectations, estimates, forecasts and projections about Enanta’s business and the industry in which it operates and management’s beliefs and assumptions. The statements contained in this release are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed in such forward-looking statements. Important factors and risks that may affect actual results include: Enanta is competing to develop intellectual property in areas of small-molecule drug development that are highly competitive; issued patents, including the patent at issue in the Pfizer litigation, could be found invalid or unenforceable if challenged in court and could be costly to defend and be a distraction for Enanta’s senior management and scientific personnel; intellectual property litigation may lead to unfavorable publicity that harms Enanta’s reputation and causes the market price of its common stock to decline; and other risk factors described or referred to in “Risk Factors” in Enanta’s Form 10-K for the fiscal year ended September 30, 2024 and other periodic reports filed more recently with the Securities and Exchange Commission. Enanta cautions investors not to place undue reliance on the forward-looking statements contained in this release. These statements speak only as of the date of this release, and Enanta undertakes no obligation to update or revise these statements, except as may be required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241224565771/en/

Media and Investors:

Jennifer Viera

617-744-3848

jviera@enanta.com

Source: Enanta Pharmaceuticals, Inc.

FAQ

What was the court's ruling in Enanta's patent lawsuit against Pfizer regarding Paxlovid?

The United States District Court of Massachusetts ruled that Enanta's '953 Patent is invalid and granted Pfizer's summary judgment motion. The Court also denied Enanta's partial motion for summary judgment of infringement.

How will ENTA respond to the court's ruling on the '953 Patent?

Enanta Pharmaceuticals plans to appeal the decision to the Court of Appeals for the Federal Circuit.

Will ENTA try to block Paxlovid production after losing the patent case?

No, Enanta maintains its commitment to avoid impeding the production, sale, or distribution of Paxlovid.

What was Enanta's patent infringement lawsuit against Pfizer about?

The lawsuit sought damages for alleged infringement of U.S. Patent No. 11,358,953 in the manufacture, use, and sale of Pfizer's COVID-19 antiviral, Paxlovid.