Merck undercuts Pfizer on Remicade biosimilar price
- Merck this week launched its biosimilar version of Johnson & Johnson's blockbuster inflammatory disease drug Remicade (infliximab) in the U.S., pricing the copycat biologic at a 35% discount to the branded version's wholesale acquisition cost.
- Marketed as Renflexis (infliximab-abda), Merck's copy was developed by Korean drugmaker Samsung Bioepis under a development and commercialization deal the two companies signed to cover an array of biosimilar candidates in the U.S., Europe and elsewhere.
- Notably, Merck priced Renflexis at a deeper discount to Remicade than Pfizer's starting price for its own biosimilar of Remicade, Inflectra (infliximab-dyyb). Pfizer launched Inflectra last fall at a 15% discount, which disappointed some who were expecting greater savings from biosimilars.
With Renflexis following Inflectra to market, J&J will now have to contend with two cheaper biosimilar competitors to its main immunology brand.
J&J has said it doesn't expect biosimilars to rapidly erode Remicade sales in the U.S. — at least at first — citing contracting it already has in place with managed care organizations. And, unlike generics, biosimilars can't be automatically swapped in for the branded reference product at the pharmacy. The Food and Drug Administration has the authority to approve biosimilars as so-called "interchangeable" products, but hasn't done so with any of the biosimilars approved to date.
Sales of Remicade did drop 14% year over year in the second quarter, but J&J chalked much of that decline up to the roughly $170 million in rebate adjustments in the same period last year.
Ironically enough, Merck knows all to well how the entry of biosimilars can cut into sales. While J&J markets Remicade in the U.S., Merck sells the drug in Europe, Turkey and Russia.
The European Medicines Agency approved Celltrion's biosimilar version to Remicade in October 2013 and has since approved Samsung Bioepis' version as well (which, in another complicated licensing twist, is marketed by Biogen).
Since 2014, Merck's sales of Remicade have steadily eroded and the company expects further declines to continue.
In the U.S., where Merck is on the other side of the biosimilar market battle, the company plans to support the launch of Renflexis with education efforts aimed at physicians and patients.
Merck also expects payers to be interested in the potential savings Renflexis could offer — although it should be noted that the 35% discount cited by Merck is in reference to Remicade's wholesale acquisition cost. After rebates and discounts negotiated by J&J and payers, the net price of Remicade could be more competitive with Renflexis' list price.
"We are seeing high interest given the potential for increased access and savings that biosimilars can offer to the system," said Dora Bibila, general manager for biosimilars at Merck, in an interview.
"Given the differences from generics, I think it is going to be a balance where, at the same time being interested in the savings, the payers are also going to want to get reassured about other components — not only the safety, efficacy, quality of the product but components such as, for example, reliability of supply," Bibila explained.
As more biosimilars reach markets in the U.S., uptake will be watched closely as a barometer of how well big drugmakers can stave off erosion to sales of their blockbuster biologic brands. Many such drugs, like Amgen's Enbrel (etanercept), Roche's Herceptin (trastuzumab) and AbbVie's Humira (adalimumab), will face biosimilar competition in the near future.
In generic markets, research has shown prices quickly fall to levels between 20% and 25% of the original branded drug's price. But, given the higher cost of developing a biosimilar, it's not yet clear if the copycat biologics will offer the same kind of savings.
Follow Ned Pagliarulo on Twitter