Dive Brief:
- The Competition and Markets Authority (CMA) in the U.K. has issued a provisional decision that Merck Sharp & Dohme operated an anti-competitive discount scheme to protect the anti-inflammatory drug Remicade (infliximab). Merck Sharp & Dohme (MSD) is a subsidiary of Merck & Co.
- The CMA proposes to hold MSD liable for breaking competition law by operating a discount scheme for Remicade that aimed to restrict competition from new biosimilar versions of infliximab.
- MSD and Merck now have an opportunity to respond before the CMA makes any final decision on whether the actions, in fact, violated competition law.
Dive Insight:
The CMA began its investigation of MSD’s alleged improper discount schemes for Remicade in December of 2015. In a statement on Tuesday, the CMA underscored that its findings were provisional, and no final conclusion had yet been reached.
Merck could not be reached for comment on the CMA ruling.
If found liable, Merck is likely to be hit by a financial fine — but not one that will make a real dent in Merck’s bottom line. The largest financial penalty imposed by the CMA on a pharmaceutical company is $110 million.
In Britain, drug pricing is an important issue, since its public sector healthcare is funded by taxes. The CMA issued its ruling against MSD during a time of real financial stress for Britain’s healthcare system, due to growing population, rising costs and austerity measures.
Remicade and infliximab biosimilars are used to treat patients with gastroenterology and rheumatology conditions such as Crohn’s disease, ulcerative colitis and rheumatoid arthritis.
Remicade’s cheaper biosimilar competitors in the U.K. include Flixabi (marketed by Samsung Bioepis) and Remsima (marketed by Celltrion).
The European Commission granted marketing authorization for Remsima in 2013. Prior to approval, Remsima was compared with Remicade in a study of 606 adults with rheumatoid arthritis. In the study, patients received either Remsima or Remicade in addition to methotrexate for 30 weeks. The researchers for the study found Remsima to be as effective as Remicade with about 60% of patients responding to either treatment. Another study with 250 patients diagnosed with ankylosing spondylitis also showed that Remsima produced the same levels of active substances in patient’s bodies as Remicade.
Flixabi;was granted marketing authorization by the EC three years later, in 2016. A 54-week phase 3 study in patients with moderate to severe rheumatoid arthritis found that Flixabi was equivalent in efficacy and safety to Remicade. The phase 3 data was crucial to Flixabi’s approval in the EU.
Merck's revenues from Remicade fell by 34% to $229 million in the first quarter of 2017 compared to the same period a year prior — a decline Merck attributed to biosimilar competition and loss of exclusivity.
While Merck markets Remicade in Europe, Russia and Turkey, J&J holds commercialization rights in the more lucrative U.S. market.
Even in the U.S., biosimilar competition could soon have an effect. The FDA approved the biosimilar Inflectra, marketed by Pfizer and Celltrion, back in 2016 and Samsung Bioepis' version was given a green lightin April. While Pfizer has already launched Inflectra, sales have not yet been substantial.