Johnson & Johnson announced its fourth quarter results yesterday and while total pharmaceutical sales grew 17.6% year-on-year to $9.7bn (€7.8bn), the firm reported another quarter of declining sales of one-time top-selling biologic Remicade (infliximab).
In the US, Janssen – J&J’s biopharmaceutical subsidiary – has faced over a year of biosimilar competition from Pfizer’s Inflectra, and saw a second infliximab biosimilar marketed by Merck & Co. enter the market in July.
As such, management reported US sales of $1.1bn, down 8.5% on last year.
“This is more of a decline than the modest levels of erosion we experienced during the first three quarters of 2017,” said VP of investor relations, Joseph Wolk on a conference call.
But while Remicade export and international sales declined directly due to erosion from biosimilar competition in key markets such as Europe, Wolk said in the US “demand was relatively stable and the erosion was primarily driven by negative price.”
Discounts and rebates
The wholesaler acquisition cost (WAC) for Remicade is $1,159. This is the price J&J determined for wholesalers and direct purchasers but excludes discounts and rebates.
When Merck & Co.’s Renflexis entered the market, it was at a 35% discount on the WAC of Remicade, something matched by Pfizer, which originally launched Inflectra at a 15% discount.
Details on pricing changes were not shared on the call, but Janssen spokesperson Megan Farina told Biopharma-Reporter that Remicade’s list price “is only a starting point and is ultimately reduced by the discounts and rebates we give payers and providers.”
She declined to provide figures on these reductions, but said: “In contracting for Remicade, payers and providers have demanded and we have provided aggressive discounts.”
On the call, CFO Dominic Caruso reiterated that the firm “saw far less of an impact in 2017 than [it] had expected,” especially as Pfizer’s Inflectra has “now been on the market for over a year and we do have an additional biosimilar market entrant.”
But going into 2018, Caruso predicted the “acceleration” of biosimilar impact to Remicade, though was unable when asked to offer stakeholders a specific figure.