Regeneron finds itself on the wrong side of court ruling earlier this week
Regeneron Pharmaceuticals Inc (NASDAQ:REGN) has received a price target cut at Jefferies after the US district court rules that Regeneron has indeed infringed copyrights related to Repatha, a drug owned by Amgen. Jefferies believes that the development is a big negative for Regeneron and its partner Sanofi, and it could lead to some serious price contraction in the near term. The analyst therefore cut the price target and adjusted some estimates in order to reflect the impact of the new development.
Earlier this week, the US district court of Delaware has ordered permanent injunction against Regeneron and Sanofi regarding the infringement of two of Amgen’s patents. The lawsuit began in March 2016 when Amgen filed the complaint against the two pharmaceutical companies regarding the infringement of two of its patents related to its drug, Repatha. While the injunction is permanent, the court has given a 30-day grace period to the two involved companies to seek a review of the decision.
Following the ruling Sanofi and Regeneron has announced that they will be appealing to contest the decision taken by the district court. The companies will seek rights to continue to sell, market, and manufacture Praluent. The news of permanent injection against Praluent has come as a surprise for investors and both the stocks declined significantly in the aftermath of the decision.
Analyst Biren Amin believes the decision taken by the district court is against the public interest, but the facts of the matter suggest that Regeneron and its partner Sanofi did indeed knowingly infringe patents owned by Amgen. Mr. Amin cut the price target of Regeneron Pharmaceuticals down to $349 from his previous price of $394 but maintained his hold rating. The analyst ratings on Regeneron are 7 Buy, 5 Outperform, and 13 Hold. The stock currently trades at a price of $357.08 and has declined 6.26% since the open of the market.