- Johnson & Johnson's blockbuster anti-inflammatory treatment experienced a double-digit drop in sales during the second quarter, but the big pharma cautioned investors not to place too much of that decline on biosimilar competition.
- Remicade (infliximab), approved for several indications including Crohn's disease and ulcerative colitis, brought in $1.06 billion during the second quarter, down 14% from the same period in 2016. Since last April, the Food and Drug Administration has approved copycat biologics to the drug: Celltrion's Inflectra (infliximab-dyyb) and Samsung Bioepis’ Renflexis (infliximab-abda).
- But during a Tuesday earnings call, Johnson & Johnson execs said the sales decrease seen with Remicade — as well as the company's overall immunology portfolio — was largely due to approximately $170 million worth of rebate adjustments from the second quarter last year. Excluding that factor, Remicade sales were down about 5%.
"That 5% down has some impact of price, some minor impact of share erosion, and we see some conversion of Remicade ... to Stelara in Crohn's disease," Johnson & Johnson's Chief Financial Officer Dominic Caruso said on the call, adding that his company and industry analysts had predicted a much larger decline, "which we all targeted to be somewhere between 10% and 15%."
Biosimilars have just recently squeezed out a foothold in the U.S., with only a handful approved so far and many still unable to launch on the market due to legal issues. Stateside drugmakers, however, are well aware of the potential of those drugs to disrupt markets and their bottom lines.
For the few pharmaceutical companies — Johnson & Johnson, Amgen and AbbVie — that are already experiencing competition from copycat biologics, solidifying their products' market shares or revamping pipelines and portfolios have been key strategies for quelling investor concerns.
Johnson & Johnson execs, for instance, underscored the potential for the company's recently green lit psoriasis drug Tremfya (guselkumab) and sirukumab, a rheumatoid arthritis treatment filed for FDA approval last September, to breathe new life into the immunology portfolio.
Noteworthy, though, is the fact that Johnson & Johnson is in the unique position of having two biosimilars to contend with. Samsung Bioepis’ Renflexis received U.S. approval a few months ago, and while it hasn't hit the market yet, it's another thing the big pharma will have to keep in its sights.
"In terms of what impact that might have, I think that all depends on the degree to which they discount that product and the significance of which they discount that product," Caruso said. "But I would say largely for this year, we have all our contracting in place with all the managed care organizations, so we feel pretty good that Remicade erosion overall, even with the entrance of a new biosimilar, will be less than expected."
It would appear that the drugmaker has convinced at least some investors.
"The business faces some near-term challenges, including pressure on Pharma from prior period gross to net adjustments, as well as slowing growth on Remicade, Zytiga and Invokana," investment firm Jefferies wrote in a July 14 note. "However, we think US biosimilars may have a smaller than expected impact on Remicade and that there are some notable opportunities in the pipeline that may be underappreciated."