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ESPR Settles Nexletol/Nexlizet Patent Litigation With RDY, Stock Up

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Key Takeaways

  • Esperion reached a settlement with Dr. Reddy's over patents for Nexletol and Nexlizet.
  • RDY agreed not to launch U.S. generics of the drugs before April 19, 2040, under the deal.
  • The settlement resolves remaining disputes with RDY tied to Esperion's key bempedoic acid patent.

Esperion Therapeutics (ESPR - Free Report) announced that it has entered into a settlement agreement with Dr. Reddy’s Laboratories (RDY - Free Report) related to patents for the marketed drugs, Nexletol (bempedoic acid) and Nexlizet (bempedoic acid and ezetimibe).

Per the settlement terms, Dr. Reddy’s has agreed not to launch a generic version of Nexletol or Nexlizet in the United States before April 19, 2040, except under certain limited conditions that are customarily included in such agreements.

The settlement agreement resolves the patent litigation brought by Esperion on RDY’s abbreviated new drug application (“ANDA”), seeking marketing approval for a generic version of each of Nexletol and Nexlizet in the United States before the applicable patents expire.

Shares of Esperion were up 13.8% following the announcement of the news on Oct. 3.

The stock has risen 50% so far this year compared with the industry’s growth of 14.1%.

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More on the ESPR's Patent Settlement With RDY

Esperion markets bempedoic acid as Nexletol and Nexlizet for treating elevated LDL-C (bad cholesterol) and cardiovascular risk reduction. Nexlizet is a combination of bempedoic acid and ezetimibe.

Bempedoic acid is covered under Esperion’s U.S. Patent No. 7,335,799, which is set to expire in December 2030.

With the latest settlement involving Dr. Reddy’s, all remaining disputes concerning the validity or infringement of U.S. Patent No. 7,335,799 in the ongoing patent litigation have been resolved.

Some of Esperion’s patents still involved in the ongoing patent litigation are set to expire in March 2036, while others are set to expire in June 2040.

Earlier this year, Esperion reached settlement agreements with three ANDA filers (Micro Labs USA, Hetero USA and Accord Healthcare) related to patents for Nexletol. Per the settlement terms, the ANDA filers will not be able to market a generic version of Nexletol until 2040.

ESPR's Sole Top-Line Driver – Nexletol & Nexlizet

Nexletol and Nexlizet are marketed as Nilemdo and Nustendi in ex-U.S. markets (excluding Japan, where the company has a collaboration with Otsuka Pharmaceuticals) in partnership with Daiichi Sankyo. The company records royalties on sales of its drugs in ex-U.S. markets.

Esperion records revenues from product sales and collaboration revenues, which include royalties on sales of Nilemdo/Nustendi by collaboration partners.

Nexletol was approved in Japan as a treatment for hypercholesterolemia and familial hypercholesterolemia last month.

Net product sales of Nexletol and Nexlizet in the United States grew 42% in the first half of 2025, indicating increased prescription growth volumes. The patent litigation settlement helps Esperion to protect Nexletol/Nexlizet sales from generic erosion in the United States.

ESPR's Zacks Rank & Other Stocks to Consider

Esperion currently carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the drug sector are Collegium Pharmaceutical (COLL - Free Report) and Avadel Pharmaceuticals (AVDL - Free Report) , each carrying a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, estimates for Collegium Pharmaceutical’s 2025 earnings per share have moved up from $6.90 to $7.03. Earnings per share estimates for 2026 have increased from $6.77 to $7.12 during the same period. COLL stock has increased 20.8% year to date.

Collegium Pharmaceutical’s earnings beat estimates in three of the trailing four quarters while missing the same on the remaining occasion, the average surprise being 4.96%.

In the past 60 days, estimates for Avadel Pharmaceuticals’ 2025 earnings per share have moved up from 19 cents to 25 cents. Earnings per share estimates for 2026 have increased from 77 cents to 85 cents during the same period. AVDL stock has surged 42.8% year to date.

Avadel Pharmaceuticals’ earnings beat estimates in three of the trailing four quarters, while meeting the same on the remaining occasion, the average surprise being 119.64%.

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