NanoString files for bankruptcy, explores potential sale amid patent battle with 10x Genomics

NanoString files for bankruptcy, explores potential sale amid patent battle with 10x Genomics

After losing a patent infringement lawsuit last year that ended with an order to pay out $31 million in damages, leaving it all but hanging by a thread, NanoString Technologies is plotting a new way forward.

The company has filed for Chapter 11 bankruptcy, it announced Sunday evening. In tandem with the filing, several of NanoString’s existing creditors have pooled at least $40 million as debtors in possession to keep funding the company’s operations. In the meantime, NanoString said it will begin exploring “strategic alternatives,” which may include a sale of some or all of the business to new owners; some potential buyers have already expressed their interest, according to the announcement.

Additionally, the Chapter 11 filing will temporarily pause all patent litigation against the company, giving it a respite from the ongoing stream of court cases brought by 10x Genomics.

“The unexpected outcome of the November GeoMx patent litigation trial in Delaware and the unusually large magnitude of the damages awarded by the jury have forced us to take proactive steps to protect our stakeholders, customers and employees,” CEO Brad Gray said in the announcement.

“NanoString has powerful product platforms, strong relationships with our customers throughout the scientific community, an enviable workforce, and conviction in the integrity of our innovation process,” he continued. “We believe chapter 11 protection will provide us with the necessary breathing room to continue to serve our customers while we address our litigation and the related financial challenges.”

Amid the court-supervised restructuring process that NanoString has now begun, the company said it would proceed with business as usual. That includes continuing to serve its customer base of researchers who use NanoString’s nCounter, GeoMx and CosMx platforms, which are used to spatially profile the RNA and certain protein targets in a cell sample.

That hardware has been the target of multiple patent infringement cases brought by 10x Genomics in both the U.S. and Europe since 2021, according to NanoString.

The case that closed at the end of last year revolved around the GeoMX digital spatial profiler. In late November, a federal jury sided with 10x Genomics and ordered NanoString to pay its competitor about $25 million in lost profits and another $6 million in royalty payments. As NanoString pledged to appeal the decision, 10x Genomics said at the time that it was planning to seek even more damages, royalties and reimbursement for its court fees while also pursuing an injunction that would stop NanoString from selling its GeoMX products.

In this week’s bankruptcy announcement, NanoString accused 10x Genomics of levying its lawsuits “with the apparent goal of shrinking the competitive landscape for different spatial biology platforms to the detriment of the public good,” echoing its ongoing efforts to charge its opponent with antitrust violations. NanoString also reiterated its confidence in the strength of its own product development process and legal claims against 10x Genomics.

That confidence remains even after a string of losses: In the six months preceding last November’s verdict—and including that result—10x Genomics had won claims based on nine of its patents, spanning three separate courts. One of the cases resulted in the European Unified Patent Court issuing a preliminary injunction against NanoString’s CosMx instruments and reagents.

“At some point, NanoString must drop the charade that it is ‘confident’ it does not infringe the 10x patents and the patents are invalid,” Eric Whitaker, 10x Genomics’ chief legal officer, said in a November statement.

error: Content is protected !!