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Johnson & Johnson Remicade Anti-Competition Antitrust Class Action

In 2010, Congress enacted a Biologics Price Competition and Innovation Act to enable biosimilar (generic) drugs to receive approval, to spur price competition for drugs. However, the complaint for this class action alleges that when other companies developed competitors for Remicade, Johnson & Johnson (J&J) unfairly blocked their access to the market, requiring consumers to pay significantly higher prices than they would otherwise have.

The class for this action is all entities who bought, paid for, or provided reimbursement for some or all of the purchase price of Remicade, from at least April 5, 2016 to the present.

The Food and Drug Administration (FDA) approved Remicade (infliximab) to treat Crohn’s disease, and later for other conditions, including ulcerative colitis, rheumatoid arthritis, ankylosing spondylitis, psoriatic arthritis, and plaque psoriasis. For nearly twenty years, it was the only infliximab drug on the market, and was J&J’s top seller by far, earning the company roughly $5.7 billion in US sales in 2015.

It is expensive: The complaint claims that for most patients, the cost per infused dose is $4,000-$6,000, with a full year’s treatment costing $26,000 or more.

In April 2016, Pfizer, Inc. received FDA approval for a drug it called Inflectra, which was biosimilar to Remicade. A year later, Merck, Inc. received approval of Renflexis. Their prices were lower than Remicade’s $1,113 per vial—$946 and $735.39 respectively.

According to the complaint, J&J continued to insist that other drugs violated its intellectual property rights, despite the fact that it had already lost a case against Pfizer. Second, it insisted that Remicade was better.

But that wasn’t all. The complaint alleges that the company was taking other, unpublicized actions, involving attempts to form anticompetitive arrangements with insurers to shut its competitors out of the market:

  • Pure exclusion contracts: J&J required that Remicade be the only infliximab drug insurers would cover and reimburse for.
  • Fail First contracts: J&J required insurers would not reimburse for other infliximab products unless Remicade had first been tried and failed. This effectively meant that the others would not be used, because if Remicade was ineffecitve, doctors would not be likely to try another similar infliximab product.
  • Bundling: J&J bundled rebates for Remicade with rebates for other widely-used products, in exchanged for insurers’ promise not to use similar products. Since Pfizer and Merck cannot offer alternatives to the full range of drugs in J&J’s bundles, insurers must accept the deal in order to be able to cover popular products.

As a result of these anti-competitive actions, the complaint claims, almost no national commercial health insurers provide coverage for the biosimilar drugs. The price of infleximab has not gone down, the complaint charges, and in fact has gone up, forcing consumers to pay higher instead of lower prices. The complaint alleges that if J&J is allowed to continue with these actions, they will become the playbook for all biologic companies trying to preserve their dominance and will deprive consumers of the benefits of competition. 

Article Type: Lawsuit
Topic: Antitrust

Most Recent Case Event

Johnson & Johnson Remicade Anti-Competition Antitrust Complaint

October 27, 2017

In 2010, Congress enacted a Biologics Price Competition and Innovation Act to enable biosimilar drugs to receive approval, to spur price competition for drugs. However, the complaint for this class action alleges that when other companies developed competitors for Remicade, Johnson & Johnson (J&J) unfairly blocked their access to the market, with exclusivity contracts and other provisions with insurers, requiring consumers to pay significantly higher prices than they would otherwise have. 

remicade_anti_trust_complaint.pdf

Case Event History

Johnson & Johnson Remicade Anti-Competition Antitrust Complaint

October 27, 2017

In 2010, Congress enacted a Biologics Price Competition and Innovation Act to enable biosimilar drugs to receive approval, to spur price competition for drugs. However, the complaint for this class action alleges that when other companies developed competitors for Remicade, Johnson & Johnson (J&J) unfairly blocked their access to the market, with exclusivity contracts and other provisions with insurers, requiring consumers to pay significantly higher prices than they would otherwise have. 

remicade_anti_trust_complaint.pdf
Tags: Antitrust, Pharmaceuticals