Moderna Reaches Landmark $2.25 Billion Settlement with Genevant and Arbutus Over LNP Patent Dispute

Genevant Sciences and Arbutus Biopharma announced on March 3, 2026, that they have entered into a comprehensive global settlement with Moderna, Inc. to resolve all patent litigation concerning the unauthorized use of Genevant’s and Arbutus’ lipid nanoparticle (LNP) delivery technology in Moderna’s COVID-19 vaccines. The settlement agreement, disclosed just days before a scheduled jury trial in the U.S. District Court for the District of Delaware, could result in Moderna paying up to $2.25 billion.

Under the terms of the settlement, Moderna will make an upfront payment of $950 million to Genevant and Arbutus in July 2026. An additional payment of up to $1.3 billion is contingent upon a favorable ruling on appeal regarding the applicability of 28 U.S.C. § 1498, which Moderna argued bars certain patent infringement claims. Moderna has consented to a judgment of infringement and no invalidity for the four patents asserted in the litigation.

Moderna issued a statement expressing confidence in its ongoing appeal to the U.S. Court of Appeals for the Federal Circuit. The company stated that it does not consider a loss under the pending Section 1498 proceeding probable. However, Moderna agreed to make the additional payment within 90 days if the Federal Circuit affirms liability under Section 1498. Should Moderna ultimately prevail through further appellate or Supreme Court review, Arbutus and Genevant will refund the full payment plus interest.

The dispute centered on four Arbutus patents related to LNP technology critical for delivering messenger RNA (mRNA) in Moderna’s Spikevax® vaccine. Three patents—U.S. Patent Nos. 8,492,359, 9,364,435, and 11,141,378, collectively known as the “Molar Ratio Patents”—claim specific percentage ranges for the four lipid components forming the nanoparticles. The fourth patent, U.S. Patent No. 9,504,651, covers a method for formulating the LNPs.

Key rulings by U.S. District Judge Colm F. Connolly (presiding in Delaware) shaped the litigation before settlement. On February 18, 2026, Judge Connolly granted partial summary judgment limiting Moderna’s invalidity defenses. The court barred Moderna from challenging several Arbutus patents on obviousness and derivation grounds, citing inter partes review (IPR) estoppel and issue preclusion doctrines. Moderna had previously challenged U.S. Patent No. 9,364,435 in an IPR proceeding before the Patent Trial and Appeal Board (PTAB), which upheld the patent’s validity. The court rejected Moderna’s argument that estoppel should not apply due to the Federal Circuit’s dismissal of its appeal for lack of standing, emphasizing that IPR estoppel is a statutory, not common law, doctrine.

The court also granted summary judgment against Moderna’s derivation defense, finding that Moderna failed to prove prior conception and communication of the invention to Arbutus inventors as required under 35 U.S.C. § 102(f).

Earlier, on February 4, 2026, Judge Connolly issued a pivotal ruling interpreting the phrase “for the Government” in 28 U.S.C. § 1498. The court held that the statute’s defense applies only when patented products are used for the government’s direct benefit, not for patients receiving the vaccines. This interpretation excluded the vast majority of Moderna’s over $8.2 billion in vaccine sales to the U.S. government from Section 1498 protection, preserving those sales for damages calculations. The defense was limited to vaccines administered to government employees, which Arbutus estimated accounted for approximately 1.25% of total sales.

Additionally, the court found that Arbutus’s removal of the term “about” from lipid ranges during patent prosecution triggered prosecution history estoppel. This barred Arbutus from asserting infringement under the doctrine of equivalents, requiring proof of literal infringement.

The settlement grants Moderna a global non-exclusive license to Genevant’s LNP delivery technology for infectious disease applications. It also includes a covenant not to sue regarding certain Genevant and Arbutus patents and Moderna products, effectively ending all patent infringement litigation between the parties related to COVID-19 vaccines.

Lindsay Androski, President and CEO of Arbutus, described the settlement as a “transformative outcome” and a “long-overdue recognition” of Arbutus scientists’ seminal contributions to the development of COVID-19 vaccines.

If fully realized, the $2.25 billion settlement would represent the largest disclosed patent settlement in the pharmaceutical industry and the second largest across all industries. Following the upfront payment, Arbutus announced plans to evaluate a return of capital to shareholders in the third quarter of 2026.

This landmark resolution underscores the high stakes of patent disputes involving breakthrough technologies critical to public health and highlights the complex interplay between patent rights and government use defenses in the pharmaceutical sector.