A federal judge denied Novartis' (NVS) motion Tuesday to dismiss a lawsuit against the company brought by Tara Tindle, who alleged that the company did not warn patients its asthma drug terbutaline prescribed in pregnant women could lead to abnormal brain development in babies, Bloomberg reported Wednesday.

Tara alleged that she was prescribed terbutaline to inhibit preterm labor before her daughter Jayden Tindle was born. Jayden now has autism as per Tara's claims, the news report states.

Novartis argued in the court that it had sold the drug's marketing rights to another company in 2001 and the court "lacked personal jurisdiction" on the matter, the report said. However, the company's argument was rejected by the US District Court for the Central District of California.

The court will now discuss the matter with the parties on Thursday, according to the proceeding minutes.

Novartis didn't immediately respond to a request for comment from MT Newswires.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

Price: 112.83, Change: +0.55, Percent Change: +0.49