Arbutus Biopharma Shares Drop 21.7% on Patent Revocation Weakening European Litigation Position

The share price fell to its lowest level since September 2025 today, with an intraday decline of 21.70%.

Arbutus Biopharma’s stock slump was driven by the European Patent Office’s revocation of its key patent, EP 2279254, following a decade-long legal challenge from Moderna and Merck. The decision, based on the “added matter” rule, undermines the company’s IP position in Europe and could weaken its litigation stance in the Unified Patent Court. Arbutus plans to appeal the ruling to the Enlarged Board of Appeal, arguing the patent remains valid in the U.S., Japan, and Canada, where it continues to pursue claims against Moderna.

The stock’s 13.62% daily drop and 15.06% two-day decline reflect investor concerns over the patent’s role in Arbutus’s revenue potential and litigation strategy. While the company maintains a strong liquidity position with a current ratio of 18.8, its third-quarter financials—reporting a $0.04-per-share loss and $530,000 in revenue—highlight operational challenges. These figures, below analyst forecasts, amplify skepticism about its ability to sustain prolonged legal battles without financial strain.

Despite the setback, Arbutus’s broader IP strategy in non-European jurisdictions remains intact. The “added matter” standard does not apply in the U.S. or Canada, where the company’s litigation against Moderna and other partners proceeds. However, the revocation complicates its position in the UPC, where one of two cases now excludes the contested patent. The outcome of the appeal and the resolution of ongoing disputes will be critical in determining Arbutus’s ability to protect its lipid nanoparticle technology and maintain competitive leverage in the biotech sector.