Liquidia soars over 40% after agreeing to pay $380.7 million to settle with United Therapeutics and keep YUTREPIA on the market

Liquidia shares jumped more than 40% after hours on October 13 after the company reached a global settlement with United Therapeutics resolving all pending litigation between them. Liquidia closed the regular session at $26.81 and indicated about 42% higher after the bell.

Liquidia is the payer. The $380.7 million total breaks down into $175 million net to United Therapeutics within 30 business days (a $185 million estimate of damages for past PH-ILD sales of YUTREPIA, net of funds United Therapeutics pays Liquidia to resolve separate antitrust litigation), $145.4 million to United Therapeutics in two installments of $72.7 million due in 2027, and $60.3 million to the Sandoz and RareGen antitrust parties. Liquidia had $396.1 million in cash at September 30 and says it can make the payments without new financing.

The settlement follows a September 30 Delaware ruling that YUTREPIA, Liquidia's inhaled treprostinil, infringed a United Therapeutics patent, which sent Liquidia's shares down about 57% that day. Under the deal, YUTREPIA stays on the market for pulmonary arterial hypertension (PAH), but Liquidia must drop the PH-ILD indication and stop PH-ILD sales, and it will not appeal. Neither company disclosed royalty or supply terms.

The rally reflects relief that the drug survives in its main indication, at a cost Liquidia can cover from cash. Separately, MarketBeat reported that the CEO sold $932,549 of stock at $28.48 a share before the settlement was announced. For United Therapeutics, which closed at $543.40, the deal brings in $330.4 million gross; its shares were little changed after hours.