Patent, Trademark, And Intellectual Property Representation For Businesses And Corporations

Patent lawsuits can have a major impact on company finances

On Behalf of | Jan 14, 2024 | Intellectual Property

Patents are a key form of protection for organizations involved in research and development. A patent theoretically gives a company sole control over a concept or process for a set amount of time. The company that holds the patent can choose to license certain ideas to other organizations or to keep those advances private to corner a specific market.

If a company discovers that a competitor or even a business in another industry has used patented ideas without permission, it may initiate a lawsuit. Patent enforcement litigation can lead to the courts awarding damages to the plaintiff or restricting the future economic activity of the defendant. Having the right support during such litigation is crucial, as failed patent enforcement attempts can do real damage to a company’s financial prospects.

A recent case serves as a cautionary tale

The biotech company Regenxbio and the University of Pennsylvania cooperated to file a patent enforcement lawsuit in Delaware federal court against Sarepta Therapeutics. The plaintiffs held a patent on a special gene therapy for Duchenne Muscular Dystrophy (DMD).  Regenxbio licensed a gene-therapy patent from the University of Pennsylvania, which the company needed to develop a treatment for DMD.

However, Sarepta beat them to that goal when it announced a DMD gene therapy treatment in 2023.  Regenxbio and the University of Pennsylvania filed a lawsuit in an effort to protect the research invested in the concept. Unfortunately, the litigation was unsuccessful. The judge ruled against the plaintiffs, asserting that that patent was invalid.

That decision impacted the company almost instantly. The stock price for Regenxbio tumbled 15% shortly after news about the ruling became public knowledge. Although the company announced its intent to appeal, the court ruling frightened investors, who sold shares out of fear that the company’s profit margins would likely shrink.

It is therefore of the utmost importance that those seeking to enforce an existing patent approach the process with care. Litigation often inevitably draws attention to an issue that could affect public perception of the company’s future prospects.

Proper legal representation is crucial during any kind of intellectual property or patent dispute. Bringing in outside support during patent litigation may be necessary even for companies that currently have broader in-house legal representation to serve everyday needs.