Partner Jeffrey Alberts Comments on a Hedge Fund’s Attack on Acorda under the America Invents Act
Partner Jeffrey Alberts, head of Pryor Cashman’s White Collar Defense and Investigations Practice spoke to Law360 for the article, “Hedge Fund’s AIA Attack Should Have Biotech Cos. Wary.”
The article reports on a hedge fund's attempt to invalidate Acorda Therapeutics Inc. drug patents under the America Invents Act in an attempt to lower the company's stock price. An organization affiliated with Hayman Capital Management LP filed inter partes review petitions challenging the validity of two patents on Acorda's multiple sclerosis drug Ampyra. The fund reportedly stands to gain if the stock price drops. Hayman manager Kyle Bass announced plans to challenge what he called weak pharmaceutical patents as a way of reducing drug prices for consumers and growing his fund.
Alberts stated that Bass and other hedge funds that want to use inter partes reviews to influence stock prices are unlikely to face legal consequences. “Manipulating stock prices can be actionable under securities law if someone makes false statements designed to artificially influence the price. However, it would be really difficult to prove he didn’t have a valid intent for filing the petitions,” said Alberts.
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