January 25, 2017
By Alex Keown, BioSpace.com Breaking News Staff
NEW YORK – With the release of Johnson & Johnson ’s fourth quarter and year-end earnings, sales of rheumatoid arthritis drug Remicade dipped 1.7 percent, which could signal trouble as a biosimilar developed by Pfizer and Celltrion is wedging into the sales space.
That drop in fourth quarter sales to $1.17 billion came on the heels of a 9.4 percent increase in sales during the third quarter. Writing in the Motley Fool, analyst Todd Campbell said that drop in market share for Remicade could be Johnson & Johnson’s biggest risk for the coming year.
In April, the U.S. Food and Drug Administration approved Inflectra, Pfizer’s biosimilar of Remicade. The drug was available to customers beginning in October. The approval of Inflectra marked the second biosimilar approved in the U.S. Inflectra is a treatment indicated for reducing signs and symptoms in patients with rheumatoid arthritis, adult ulcerative colitis, plaque psoriasis, psoriatic arthritis, ankylosing spondylitis and adult and pediatric Crohn’s disease.
When Inflectra was introduced in October, Pfizer , which has U.S. commercial rights, began selling it with a 15 percent discount to the current wholesaler acquisition cost of Remicade. That discount may have been what cut into Remicade’s profits, Campbell said. Remicade has a cost of between $1,300 and $2,500 per dose.
While Johnson & Johnson holds U.S. commercial rights to Remicade, Merck markets the RA drug abroad. Campbell said Merck is seeing biosimilars cut into sales of Remicade across Europe and in other markets. In the third quarter, foreign sales of Remicade fell 30 percent, Campbell said. He added that Merck leadership cited biosimilars as the culprit.
While J&J could offer discount pricing to combat Inflectra’s lower price point, that would still reduce the revenue stream, Campbell said.
Rheumatoid arthritis is the most common form of autoimmune arthritis. It’s a painful affliction affecting the hands and joints, but there are numerous treatments, such as Genentech ’s Rituxan or AbbVie ’s Humira, that provide tremendous relief to patients. But analysts predict that more biosimilars will eventually cut into the bottom line of those traditional scripts. In fact, Pfizer is working on a biosimilar of Humira. Earlier this month the company announced its biosimilar met its primary endpoint in a Phase III trial.
While biosimilars are promising, companies are still developing RA treatments. Johnson & Johnson, along with partner GlaxoSmithKline , filed for FDA approval of sirukumab, an RA treatment. Campbell said analysts predict sales, if approved, could generate more than $1 billion. J&J is also working on “next-generation” RA treatments to bolster its pipeline, Campbell said. Those drugs, if approved, could help offset any losses that Remicade may face as a result of stiffer competition from Inflectra.
