Moderna Inc (NASDAQ:MRNA, XETRA:0QF) stock added almost 9% after it was announced that the drugmaker has agreed to pay up to $2.25 billion to settle a global patent infringement lawsuit brought by Arbutus Biopharma and Genevant Sciences over the use of lipid nanoparticle (LNP) delivery technology in its COVID-19 and RSV vaccines.
The settlement resolves all US and international enforcement actions related to Moderna’s use of Arbutus’ and Genevant’s LNP technology in Spikevax, its COVID-19 vaccine, and mRESVIA, its RSV vaccine.
The settlement removes a significant legal overhang for Moderna as it continues to defend and advance its mRNA vaccine portfolio.
Under the agreement, Moderna will pay $950 million upfront in July 2026. It may have to pay an additional $1.3 billion depending on the outcome of its appeal over government contractor immunity under Section 1498. If the court rules that the law does not shield Moderna from most of the patent claims, the extra payment will be required. If Moderna wins the appeal, it will not owe the additional amount.
As part of the settlement, Moderna consented to the entry of a court judgment of infringement and of no invalidity on four asserted Genevant/Arbutus patents. Genevant will grant Moderna a global non-exclusive license to its LNP delivery technology for SM-102-containing mRNA vaccines for infectious disease applications, along with a covenant not to sue covering certain patents and products. The agreement provides that Moderna will not owe future royalties related to the covered products.
If the full $2.25 billion is paid, the companies said the settlement would represent the largest disclosed patent settlement in the pharmaceutical industry and the second largest across any industry.
“We are pleased with this settlement, which allows us to put this lengthy dispute behind us and remain focused on our mission to leverage our world-class nucleic acid delivery systems to bring innovative medicines to people who need them,” Genevant Sciences CEO James Heyes said.
Heyes added that it was “enormously gratifying for the Genevant team to, at long last, be recognized for our pivotal contribution to restoring normalcy around the world in the face of a once-in-a-lifetime pandemic.”
Lindsay Androski, Arbutus CEO, described the agreement as “a transformative outcome for Arbutus as a company,” and said it represents “a long-overdue recognition” of the company’s role in developing LNP delivery technology used in mRNA vaccines.