With Amgen's biosim on the scene, J&J's Stelara looks poised to sidestep Medicare negotiations: HHS

There might just be a silver lining for Johnson & Johnson in the FDA's recent approval of Amgen’s Stelara biosimilar. That’s because the coming entry of a cheaper copycat presents J&J with an opportunity to elude Medicare price negotiations outlined in the Inflation Reduction Act (IRA).

Under the price negotiation framework—set to kick off in 2026 for an initial roster of 10 drugs—a therapy could be knocked off the list if a relevant generic or biosimilar enters the market, the Department of Health and Human Services (HHS) said in court documents first posted (PDF) last month. Stelara “proves this point,” HHS argued, noting that the launch of a biosimilar to J&J’s immunology blockbuster was expected “no later” than early 2025.

“If those predictions are realized, Stelara will be deselected, and negotiated prices will never take effect for the administration of Stelara,” the agency said.

Now, those premonitions are starting to come true, HHS said (PDF) in a newer filing, pointing to the FDA's Oct. 31 green light for Amgen’s interchangeable biosimilar Wezlana.

Wezlana now looks poised to become the first biosimilar challenger to Stelara, though it won’t launch until roughly the start of 2025, thanks to a May settlement between Amgen and J&J.

Amgen stands to get first shot at a sizable market: For all of 2022, Stelara pulled down $9.72 billion across its indications including plaque psoriasis, psoriatic arthritis and Crohn’s disease.

Meanwhile, J&J in June inked a similar deal with Alvotech and Teva to delay the launch of their biosimilar version—yet to gain FDA approval—to no later than Feb. 21, 2025.

There are others developing Stelara biosimilars, too, such as Samsung Bioepis, Celltrion, Biocon and a partnership between Bio-Thera Solutions and Hikma Pharmaceuticals.

Stelara was on the initial list of drugs set to face the first round of Centers for Medicare & Medicaid Services negotiations, along with J&J’s Imbruvica and Xarelto, Bristol Myers Squibb’s Eliquis, Merck & Co.’s Januvia and others. While Stelara biosimilars certainly represent a threat to J&J's top line, given the med is J&J's top drug by sales, HHS' removal of the immunology blockbuster from the negotiations would allow the company to sidestep a process that's been dreaded by top companies in the industry.

In the wake of the bill’s passing last summer, countless drugmakers, trade groups and even the U.S. Chamber of Commerce have challenged the looming price negotiations in court.

Recently, Novartis, AstraZeneca and Boehringer Ingelheim mounted their own legal counters, adding to a bevy of lawsuits from the likes of Merck, BMS and J&J.

In a September filing, Novartis, whose drug Entresto is up for pricing talks, called the negotiation process a "sham" and slammed the potential tax penalties for uncooperative companies as "draconian" and "wildly disproportionate to the punished conduct."

Meanwhile, Japan's Astellas Pharma withdrew its legal challenge to the IRA in early September. Many industry watchers had expected Astellas' Pfizer-partnered cancer blockbuster Xtandi to be included on CMS' price negotiations list. But after the drug failed to make the cut, Astellas pulled its lawsuit. 

Despite the industry’s disdain for the pricing provisions in IRA, all drugmakers included in the 2026 freshman class have agreed to play ball in the ongoing negotiation process.