I'm guessing the latter.
A court ruled in 2009 that Abbott's Humira infringed on patents owed by Johnson & Johnson
Yesterday, an appeals court disagreed, throwing out the initial ruling. In fact, the panel of three judges actually invalided Johnson & Johnson's patents.
Humira is a big deal for Abbott, making up nearly a fifth of Abbott's revenue. Not having to worry about patent breaches should help the company get back to the task at hand: taking market share from Johnson & Johnson and Merck's
But investors seem rightfully worried that the table could turn in the next round of appeals. Johnson & Johnson hasn't made a firm decision, but with a billion dollars at stake, the return on investment from paying the lawyers for a few more years seems like a foregone conclusion.
Unfortunately there isn't much Abbott's investors can do but wait and see what the next level of the court system decides. This is kind of like betting on a basketball team with a three point lead and two minutes on the clock. The team that's up has the advantage, but there's enough time left that things could easily change before the final buzzer sounds.
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