UK: Watchdog accuses Merck of breaking competition laws

Britain’s competition watchdog has accused Merck of operating an unfair discount scheme for its medicine Remicade that it said was designed to restrict competition from so-called biosimilar copies.

The Competition and Markets Authority said on Tuesday that it had provisionally found the US company’s European unit, Merck Sharp & Dohme, had abused its dominant position through the scheme, opening it up to potential financial penalties.

Remicade, known generically as infliximab, is an antibody drug used to treat rheumatoid arthritis, Crohn’s disease and ulcerative colitis.

The drug is proving an important test for the emerging biosimilars industry.

It was the first antibody drug for which copycat versions were approved by European regulators, leading to the launch of discounted products from biosimilar drugmakers including South Korea’s Celltrion, which works with Pfizer.

One person familiar with the investigation said MSD offered a discount to customers who continued to buy Remicade in the same quantities but not if they started buying biosimilars, which amounted to an incentive not to switch.

Remicade has been a big seller for Merck over the years, but sales have been falling in the face of biosimilar competition, declining 29% last year to US$1.27 billion. Merck sells the drug in Europe, while Johnson & Johnson markets it in the United States.

Such biotech drugs are made inside living cells so it is impossible to make exact generic copies, as happens with simple pills. Instead, regulators have come up with the notion of approving products that are “similar” enough to do the same job.

Full Content: Financial Times

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