Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: ViroPharma (Nasdaq: VPHM) dropped 11% in intraday trading today after a federal court dismissed the company's lawsuit against U.S. health regulators.

So what: Last September, the company filed a lawsuit against the FDA and U.S. Department of Health and Human Services, challenging testing guidelines used for evaluating generic drugs. A federal district court dismissed the motion last Friday on grounds that it lacked standing.

Now what: The lawsuit addressed the regulatory process concerning ViroPharma's Vancocin antibiotic, which effectively salvaged the company in 2005. Its dismissal appears to increase the competitive threat from generic-drug makers.  Despite expectations that EPS will decline in 2011, the stock hit a new 52-week high last Friday, suggesting investors were betting on a more favorable outcome to the lawsuit.

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Fool contributor Cindy Johnson does not own shares of any company named above. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.