Dive Brief:

• A U.S. jury awarded Guardant Health $292.5 million after ruling that a rival engaged in false advertising and unfair competition, the company said last week.
• Guardant filed a lawsuit in May 2021 alleging Natera ran a “campaign of misinformation.” Natera allegedly made “false and misleading statements” to convince people to use its Signatera cancer test rather than Guardant’s rival product Reveal, according to court documents filed with the U.S. District Court for the Northern District of California.
• The case went to trial in early November, and the jury sided with Guardant. Natera said in a Nov. 25 statement that it disagrees with the decision and will ask the court to overturn the ruling.

Dive Insight:

Guardant launched its Reveal blood test in February 2021. The product detects residual and recurrent colorectal cancer to identify people who may benefit from post-surgery chemotherapy. Reveal competes with Natera’s Signatera.

According to the lawsuit, Natera began contacting Guardant’s current and potential customers, including the Mayo Clinic, shortly after the Reveal launch. The lawsuit quotes a “Dear Colleague” ad from March 2021 that said “there is concern about other laboratories rushing into the clinical [molecular residual disease] market and making potentially misleading claims with no peer-reviewed evidence, which may be detrimental to patients.”

Natera did not name Reveal in the promotional email or accompanying slide deck but did reference data on Guardant’s test, according to the lawsuit. Guardant’s lawyers said the data referenced by Natera was peer reviewed. The lawsuit accused Natera of making other false statements.

The trial considered Guardant’s allegations and counterclaims submitted by Natera, which was seeking unspecified damages and injunctive relief. The jury found in favor of Guardant on all of its claims from the May 2021 lawsuit and rejected all of Natera’s counterclaims.

Guardant was awarded $292.5 million, including $175.5 million in punitive damages. The company said the amount is “one of the largest false advertising verdicts in history.” Natera ended September with $922.3 million in cash, cash equivalents, short-term investments and restricted cash.

Natera said the ads discussed in the trial “ran for a brief period in 2021,” adding that the “case had nothing to do with the validity or utility of Signatera, and certain key pieces of evidence supporting [its] case were not included in this trial.”