Liquidia’s YUTREPIA: FDA Approval Catalyst with Minimal Litigation Risk Ahead

The clock is ticking for Liquidia Corporation (NASDAQ: LQDA), as the FDA’s May 24 PDUFA date for YUTREPIA—its inhaled treprostinil therapy for pulmonary hypertension (PAH/PH-ILD)—looms large. While United Therapeutics (UTHR) has launched a last-minute legal challenge via its U.S. Patent No. 11,357,782 (‘782), investors would be wise to dismiss this as a paper tiger. YUTREPIA’s path to market is clear, with low litigation risk, robust financial backing, and a $2.3 billion market opportunity primed for disruption. Here’s why LQDA is a buy ahead of this pivotal decision.

The Legal Mirage: Why the ‘782 Patent Won’t Stop Approval

United Therapeutics’ new lawsuit, filed just days before the PDUFA deadline, seeks to block YUTREPIA by asserting infringement of the ‘782 patent. But this is little more than a rehash of the company’s failed attempts to protect its Tyvaso franchise. The ‘782 patent shares the same family and subject matter as the invalidated ‘793 patent, which a federal court ruled lacked novelty in December 2023. The Supreme Court’s refusal to review that decision in 2024 cemented the ‘793’s unenforceability—a precedent that bodes poorly for the ‘782.

Liquidia has already proven its mettle in these battles. In 2022, it successfully used prior art—including Voswinckle’s PAH dosing studies and U.S. Patent No. 6,521,212—to invalidate the ‘793 patent. The ‘782’s claims are strikingly similar, and Liquidia’s legal team has signaled its intent to challenge its validity. Crucially, UTHR’s lawsuit does not seek an injunction against the FDA, meaning the agency can finalize YUTREPIA’s approval unimpeded.

Note: A sharp decline on May 9 (the lawsuit filing date) presents a buying opportunity.

PDUFA 2025: A Catalyst for a 100%+ Upside

YUTREPIA’s FDA approval on May 24 would unlock immediate commercial potential in a $2.3 billion global market for PAH/PH-ILD therapies. The drug’s advantage? A dry-powder inhaler (DPI) that offers superior convenience over UTHR’s Tyvaso DPI, which requires a 30-second breath-hold and has historically low adherence rates. Clinical data from the Phase 3 INSPIRE trial show YUTREPIA achieves comparable efficacy with a simpler dosing regimen, a critical differentiator for patients.

With no injunction threat to approval, the FDA’s decision will likely proceed as planned. Even if UTHR’s ‘782 lawsuit drags on, YUTREPIA can launch immediately post-approval, leveraging a 3-year regulatory exclusivity period that expires in 2028. The market is ready—analysts estimate YUTREPIA could capture 30%+ of the PAH/PH-ILD market within two years, generating peak sales of $400 million.

Financial Fortification: $270M in the Bank, No Need for Dilution

Liquidia’s balance sheet is bulletproof. As of Q1 2025, it holds $169.8 million in cash and has secured an additional $100 million in a recent financing round, bringing total liquidity to $269.8 million. This is more than sufficient to fund commercialization, including a targeted $50 million in sales and marketing spend. With no near-term dilution risks, investors can focus on upside without fearing equity dilution.

Why Litigation Fears Are Overblown

The market’s knee-jerk reaction to UTHR’s lawsuit (a 15% drop in LQDA’s stock on May 9) is overdone. This is a repeat of 2022 tactics, when UTHR’s “patent thicket” strategy backfired spectacularly. Key points to consider:
- The ‘782 is weaker than the ‘793: Its claims are narrower and less novel, making invalidation more likely.
- Liquidia’s legal track record: It has won every major patent battle to date, including defeating UTHR’s appeals at the Federal Circuit and Supreme Court.
- No injunction = no delay: Even if the ‘782 is upheld, UTHR cannot block FDA approval—only post-launch sales, which YUTREPIA would have three years to exploit under exclusivity.

Conclusion: Buy Now Before the Surge

Liquidia is standing on the brink of a transformative FDA approval with minimal risk to its timeline. The ‘782 lawsuit is a paper tiger, and YUTREPIA’s commercial upside is undeniable. With a $270 million war chest and a product that addresses a $2.3 billion market, LQDA is a rare biotech story: a high-potential, low-risk catalyst stock.

Actionable recommendation: Buy LQDA at current levels ahead of the May 24 PDUFA decision. A positive ruling could deliver a 100%+ return by year-end, while the downside is limited by its fortress balance sheet. The only risk? Missing out on a once-in-a-decade opportunity to capitalize on a market-ready, litigation-proof winner.