Pain Management-Focused Pacira BioSciences Loses Patent Fight For Key Drug, JP Morgan Analyst Downgrades On Unclear Path

Friday, Pacira BioSciences, Inc. PCRX announced that the U.S. District Court for the District of New Jersey found that the company’s U.S. Patent No. 11,033,495 (the ‘495 patent) is not valid.

“We remain steadfast in our belief in the strength and validity of our intellectual property and that eVenus is infringing upon our patents,” said Frank D. Lee, chief executive officer of Pacira BioSciences. “In light of the Court’s decision, we are considering our legal options, which include pursuing an appellate review at the U.S. Court of Appeals for the Federal Court as warranted.”

In November 2021, Pacira BioSciences filed a lawsuit in the United States District Court for the District of New Jersey against eVenus Pharmaceutical Laboratories, Inc. for patent infringement of U.S. Patent Number 11,033,495.

The '495 patent is related to Exparel (bupivacaine liposome injectable suspension) and expires on January 22, 2041.

Exparel is Pacira BioSciences’ non-opioid analgesic pain management and is indicated for postsurgical analgesia.

The complaint sought an injunction to prevent the infringing manufacture, use, and sale of a potential generic product described in an Abbreviated New Drug Application that eVenus filed with the FDA in August 2021.

JP Morgan “previewed that an unfavorable ruling for Pacira was the most likely outcome, but this ruling is clearly the worst-case scenario…” The stock fell more than 40% on Friday after the ruling.

Exparel accounts for almost 80% of Pacira BioSciences’ revenues, which can be eroded due to a lack of patents.

In the second quarter, Exparel sales reached $136.9 million, versus $135.1 million a year ago, of the total sales of $178.0 million.

Contracted discounts and vial mix offset the second quarter volume growth of 3%.

“It is also the main source of growth as the company’s other two assets are relatively immaterial, and the Street doesn’t ascribe much value to the company’s R&D pipeline,” JP Morgan commented on Exparel.

Amid the lack of a clear path to recovery for Pacira BioSciences shares, JP Morgan has downgraded to Underweight from Overweight, with a price target of $10, reduced from the prior price target of $45.

Price Action: PCRX stock is up 5.13% at $12.30 at last check Monday.

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