Allergan again in eye of the legal storm for foiling competition to Restasis

Old eye
Shire has sued Allergan for using bundled and exclusive deals to prevent competition to blockbuster Restasis in the dry-eye drug market.

Allergan is again being accused of using unfair tactics to dodge competition for its eye drug Restasis as Shire takes to the courts to try to defeat exclusive contracts it says have kept its competing med from getting even a toehold in the market.  

Drugmaker Shire, which makes competing drug Xiidra, has filed suit in federal court in New Jersey, seeking to dismantle exclusive contracts Allergan penned with Medicare Part D providers that it says amount to an “overarching, and interconnected scheme to systematically block Shire from competing” for patients with dry eye disease.

It points to the fact that Restasis continues to hold 90% market share in the face of competition from its drug Xiidra, which is approved to treat a larger patient population and which Shire claims is a superior treatment.

“While it is a mature ‘cash cow’ for Allergan, Restasis is not an innovative product,” the suit declares. It claims the contract deals are not saving patients money because they often have to get a second drug when they take Restasis, which is not required of those using Xiidra.

Without putting a specific number on its lost sales, it claims will lose out on “millions of dollars in sales and profits” if the courts don’t halt the “bundled discounts, exclusive contracts, interference, and coercion” that it says have marginalized Xiidra on Part D formularies.

Allergan denied Shire’s claims in a statement, saying it won the business on “value and price” and that Restasis continues to provide “significant value to Medicare beneficiaries.”

This is the second federal lawsuit in recent weeks to take a shot at exclusive and bundled contracts. Pfizer made similar anticompetitive claims last month against Johnson & Johnson, which it says has used the same kind of deals to prevent Pfizer’s biosimilar Inflectra from competing against J&J’s massive seller Remicade.

RELATED: Pfizer is falling short in a competitive market, Johnson & Johnson says as it hits back at Remicade biosimilar suit

It is also the second time in recent weeks that Allergan has been blasted for taking extreme measures to protect the $1.5 billion a year that Restasis generates. Mylan took to the courts to fight a new deal in which Allergan licensed Restasis to the Saint Regis Mohawk Tribe. Allergan says that because the tribe is a sovereign nation, it is protected from inter partes patent challenges at the U.S. Patent Trial and Appeal Board.

RELATED: Mylan blasts Allergan's 'desperate' tribal licensing deal on Restasis

Mylan, which is among the drugmakers hoping to launch a generic version of Restasis, called the licensing maneuver “desperate” and a “last minute attempt to shield the patents-in-suit from inevitable cancellation.”