As competition heats up, U.S. prices for Remicade and biosims slip: analyst

As Johnson & Johnson vies with biosimilars to its big-selling Remicade, prices across the category are gradually falling, an analyst says—and Pfizer's Inflectra has taken the biggest tumble.

The J&J therapy is among just a few biologics facing off against biosimilars in the U.S. While the company initially had success holding off the new entrants, competition is finally dragging down the brand and its biosims.

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Bernstein analyst Ronny Gal wrote Monday that Remicade prices are down 10.7% year over year, compared with 24.2% for Pfizer’s biosimilar version, Inflectra, and 18% for Merck’s biosim Renflexis. He wrote that the decline is “gradual” at 3% to 7% per quarter, but “you can absolutely see the strengthening trend.” 

Now, biosimilars carry about a 25% discount to Remicade’s precompetition price, Gal wrote. But they'll have to come down a little further before it makes sense for payers to make a wholesale switch to the copies, he added. Pfizer launched its biosimilar back in October 2016, and Merck followed in July 2017. 

It hasn’t exactly been smooth sailing for the biosimilars since launch, despite upfront excitement from payers thinking they'd reap big savings by adopting the competitors. Pfizer’s Inflectra stalled for several quarters after launch, and that company sued J&J, arguing it had illegally protected Remicade’s sales through “anticompetitive” contracting.

J&J hit back, saying Pfizer wasn’t offering enough value to win business in the market. In August, a judge rejected J&J’s motion to dismiss and ruled that the lawsuit must proceed.

Inflectra’s sales so far this year amounted to $189 million in the U.S., compared with $2.82 billion for Remicade. Merck didn’t disclose Renflexis sales for the third quarter.

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Even as Remicade faces biosim competition, J&J executives say they're confident they can keep sales coming. As of the company’s third-quarter conference call, Remicade still claimed 93% of U.S. market share. The drug’s sales were down about 18% in the U.S. through the first nine months, which chief financial officer Joseph Wolk said was mostly “related to price.” 

“We continue to compete there,” he said. "And we’re going to continue to do that. Because we know that that’s what patients and healthcare providers actually see as a product of most comfort. So, based on the safety and efficacy that we’ve demonstrated for a number of years and across all indications, we feel pretty strong that it still has a very strong place in the market.” 

In October, the biosims got a boost in the form of a Medicare coverage decision from UnitedHealthcare. Thanks to a new rule from the Centers for Medicare and Medicaid Services, the insurance and PBM giant tagged the biosimilars as preferred for its Medicare Advantage plans over J&J’s brand.