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Jury Awards CareDx $44.9M in Natera Lawsuit; Finds Both Companies Engaged in False Advertising

This story has been updated from a previous version to clarify the Delaware court jury's decision regarding false advertising claims made against both companies.

NEW YORK – A jury has awarded CareDx $44.9 million in damages in the company's false advertising lawsuit against Natera. The jury's summary decision, handed down late on Monday, found Natera liable for false advertising and unfair competition.

Specifically, a Delaware District Court jury found Natera liable for all but one of 10 instance of false advertising claims made against it by CareDx. The jury also found CareDx liable for two instances of false advertising, but did not summarily find that CareDx intentionally and willfully engaged in false advertising.

The jury awarded CareDx $21.2 million in compensatory damages and $23.7 million in punitive damages.

In a statement on Monday night, CareDx said that evidence presented at the trial showed that Natera senior executives made statements that they "knew were based on unscientific, unreliable, and inappropriate conclusions to market Prospera," Natera's cell-free DNA transplant rejection test.

Natera published a statement in response calling these comments regarding Natera's executives "unsubstantiated allegations" and "false assertions."

"In addition," Natera stated, "there has been no finding regarding the scientific validity of Natera's published data and test performance."

The two claims of false advertising of which the jury determined CareDx to be at fault consisted of a study published in 2020 in Kidney360 comparing its own kidney transplant rejection test AlloSure to Prospera; declaring the study to have been free of company involvement and external funding; and a statement made in 2020 by Sham Dholakia, CareDx's senior VP of medical affairs, claiming that CareDx had not been involved in the Kidney360 study.

CareDx filed a false advertising lawsuit against Natera in 2019, accusing the latter of misleading patients and clinicians into thinking that Natera's Prospera kidney transplant test was superior to CareDx's AlloSure test through comparisons based on unscientific and unreliable data.

Earlier that year, CareDx had sued Natera for patent infringement, claiming that Natera had copied intellectual property related to the cell-free DNA analysis methods underlying AlloSure. A third patent was added to the suit in 2020. Last year, a judge declared that all three patents were invalid.

Following the judgement, CareDx stated via email that the company "will continue to market and sell AlloSure with performance claims based on the prospective, multicenter data that the jury found to be truthful, and we remain dedicated to quality science and innovation to support transplant patient care."

In its statement, Natera asserted that it would continue to pursue patent litigation against CareDx.