aibioArbutus and Genevant settle Moderna LNP patent litigation, $950.0 million due by July 8, 2026
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Moderna agrees to pay a $950.0 million noncontingent lump sum and may owe a further $1.3 billion depending on a Federal Circuit appeal on 28 U.S.C. §1498. Arbutus is entitled to 20% of proceeds after litigation costs, or, if less, tiered low single-digit royalties.
Key facts
- Company
- Arbutus Biopharma Corporation (NASDAQ: ABUS)
- News type
- Legal
- Primary source
- Arbutus Biopharma Corp Form 8-K filed March 3, 2026 (SEC EDGAR)
Arbutus Biopharma Corporation (Nasdaq: ABUS) and Genevant Sciences GmbH settled their patent infringement litigation against Moderna, Inc. and ModernaTx, Inc., the defendants, according to an 8-K filed March 3, 2026. Genevant Sciences Ltd. joined the agreement for certain purposes. The settlement resolves all of the cases pending in the United States and abroad over Moderna's use of the lipid nanoparticle (LNP) delivery technology in its vaccines, including Spikevax. The claims were allegations, and the filing does not say Moderna admitted them.
What Moderna must pay
Moderna will make a $950.0 million noncontingent lump sum payment to Arbutus/Genevant on or before July 8, 2026. A second payment of $1.3 billion is contingent. It depends on how an appeal turns out.
Under the settlement, each side files stipulated judgments and stipulations of dismissal so that the courts or tribunals can enter judgment, dismiss with prejudice, or accept withdrawal of all claims. Moderna keeps one narrow right to appeal. It may appeal only on whether 28 U.S.C. §1498 bars the claims for vaccine doses sold to the U.S. Government under a particular contract. The U.S. District Court for the District of Delaware described those doses as "vaccines that did not go directly to United States Government employees."
The contingent $1.3 billion
The contingent payment is due if the Federal Circuit affirms the district court's rejection of Moderna's §1498 defense in its entirety, or otherwise holds that §1498 does not bar the claims for all doses on appeal. It is also due if Moderna fails to file its appeal on time or voluntarily dismisses it. The filing calls any of those outcomes an "Arbutus/Genevant § 1498 Victory."
If the appellate court finds that §1498 bars the claims for some but not all of the doses, Moderna pays a prorated share of the $1.3 billion. The proration follows the number of doses barred, as the Federal Circuit articulates it. If the court does not state it clearly, the parties will agree on it, or an accelerated binding arbitration will decide it.
The repayment terms cut the other way. If an Arbutus/Genevant § 1498 Victory is later overturned in Moderna's favor in a final, nonappealable decision, Arbutus/Genevant must return the contingent payment to Moderna, plus interest.
Releases and the license
The settlement includes customary mutual releases. It also grants Moderna a fully paid-up, royalty-free, irrevocable, non-exclusive, worldwide license and covenant not to sue. The license covers Moderna's SPIKEVAX, mNEXSPIKE and mRESVIA vaccines, and other mRNA vaccines that use a lipid SM-102-based LNP formulation against an infectious disease and meet certain conditions.
What Arbutus keeps
Arbutus says that, as previously disclosed, its license with Genevant entitles it to 20% of the proceeds Arbutus/Genevant receive under the settlement, after deduction of litigation costs. If that amount is less, Arbutus instead receives tiered low single-digit royalties on net sales of the infringing product, with the settlement proceeds treated as net sales. The filing does not give the litigation costs, so the amount Arbutus will keep cannot be worked out from it.
What it means for investors
The $950.0 million is the firm money in the deal, due on or before July 8, 2026. The $1.3 billion is not in hand. It depends on an appeal, and it can be reversed with interest after the fact. Until the appeal is resolved, the company's share of the larger figure stays uncertain.
The company behind the case
Arbutus's annual report filed in March 2025 describes a clinical-stage biopharmaceutical company focused on infectious disease, developing imdusiran (AB-729) and AB-101 for hepatitis B. It says the company cut its workforce by 40% in 2024 and then decided to reduce it by a further 57%, to 19 employees. It also decided to exit its Warminster, PA headquarters and end in-house research. Its lawsuits against Pfizer Inc. and BioNTech SE over the same technology were still pending when that report was filed, and a Moderna trial date had been set for September 24, 2025.
What comes next
The full settlement agreement will be filed as an exhibit to Arbutus's annual report on Form 10-K for the fiscal year ending December 31, 2025, or in an earlier filing.