By Sneha S K and Sriparna Roy

(Reuters) -The U.S. Food and Drug Administration on Monday delayed traditional approval for Liquidia Corp's inhaled drug for types of lung disorders, and allowed only tentative clearances, sending its shares plummeting nearly 40% before the bell.

The company said it has to wait for the expiration of regulatory exclusivity to United Therapeutics' Tyvaso DPI in 2025 before its drug can receive a final approval for pulmonary arterial hypertension (PAH) and pulmonary hypertension associated with interstitial lung disease (PH-ILD).

Liquidia said it will challenge the regulatory exclusivity granted to United's Tyvaso DPI two years ago that encompasses chronic use of essentially any dry-powder formulation of treprostinil in both PAH and PH-ILD.

"This (is) a curveball scenario that we were not anticipating," said Needham analyst Serge Belanger.

The health regulator's decision marks another setback to Liquidia's efforts to market its drug, yutrepia, which is also a dry powder formulation of treprostinil.

Both Tyvaso DPI and yutrepia are delivered through a palm-sized device, making them more convenient than bulky nebulizers.

Liquidia's yutrepia was granted tentative approval in 2021 to treat PAH, but the company could not market it due to a regulatory stay related to a patent infringement dispute with United Therapeutics for Tyvaso.

The FDA on Monday once again granted tentative approval to yutrepia for PAH, as well as for PH-ILD, after the health regulator said it was still reviewing Liquidia's marketing application in January.

"Today's news removes an overhang for at least the coming quarters as Tyvaso DPI remains the only option on the market," said TD Cowen analyst Joseph Thome.

Shares of United Therapeutics rose 6.7% at $344.31 in premarket trading, while those of Liquidia were down 38.41% at $8.75.

(Reporting by Sneha S K and Sriparna Roy in Bengaluru; Editing by Tasim Zahid and Shinjini Ganguli)