With its first biosimilar stumbling in the murky backstreets of the U.S. biopharma market, Pfizer Inc. is asking a federal court to make Johnson & Johnson (J&J) play by the rules.

Pfizer filed suit Wednesday in the U.S. District Court for the Eastern District of Pennsylvania, claiming that J&J's exclusionary contracts for Remicade (infliximab), a blockbuster autoimmune drug, and other anticompetitive practices violate federal antitrust laws and undermine the fundamental goals of the Biologics Price Competition and Innovation Act, which laid the legal framework for biosimilars in the U.S.

The suit comes 10 months after New York-based Pfizer launched Inflectra, developed in partnership with South Korea's Celltrion Inc., as the first Remicade biosimilar in the U.S. Although Inflectra hit the market with a 15 percent discount from Remicade's list price, reflecting what has been the U.S. norm for a first biosimilar, it has struggled to claim market share.

J&J CEO Alex Gorsky noted in a second-quarter earnings call that Inflectra hadn't impacted Remicade sales as much as had been feared. While Remicade sales were down 14 percent for the first half of 2017, Gorsky attributed most of the erosion to price adjustments and some conversion of patients with Crohn's disease to J&J's Stelara (ustekinumab). He said Inflectra took slightly more than 5 percent of the market. (See BioWorld, July 25, 2017.)

Pfizer blames that slow start on the New Brunswick, N.J., company's "systematic efforts to maintain its monopoly." When Inflectra first entered the market, insurers granted it parity with Remicade, acknowledging that there was no medical reason to favor one over the other. "However, insurers reversed course after J&J threatened to withhold significant rebates unless insurers agreed to 'biosimilar exclusion' contracts that effectively block coverage for Inflectra and other infliximab biosimilars," Pfizer said.

Since doctors who administer the infused biologic are largely dependent on reimbursement from insurers, they "are reluctant to stock biosimilars, even to service Medicare and Medicaid patients where there is widespread coverage for Inflectra," according to Pfizer. The company also claims that J&J offered discounts on Remicade to doctors – provided they didn't purchase infliximab biosimilars.

Pfizer is "fully committed to deliver on the increased therapeutic choices and potential savings that biosimilars can bring; however, we must make sure there are no artificial barriers in the commercial insurance market that may limit coverage and use of biosimilars," said John Young, Pfizer's group president for Essential Health. "It's not in the best interest of patients and our health care system if originator companies like J&J can use their dominant market position to prevent access to lower cost, effective biosimilar medicines in the U.S."

In an effort to compete, Pfizer has tried to out-discount J&J. Inflectra now has a wholesale acquisition cost that's 19 percent lower than that of Remicade and an average selling price (ASP) that's 10 percent lower, according to a company statement. Pfizer also has granted additional pricing concessions in its negotiations with payers and more discounts could be in the offing. But even though Remicade's ASP is trending higher and Inflectra's has decreased every quarter, the biosimilar has yet to get solid footing in the U.S. market.

The little it has achieved is being threatened by Merck & Co. Inc.'s Renflexis, partnered with South Korea's Samsung Bioepis Co. Ltd. When Renflexis launched in July as the second FDA-approved infliximab biosimilar, it offered a 35 percent discount to the current list price of Remicade. Given J&J's annual contracts for Remicade, Renflexis and Inflectra will have to compete for share in the portion of the market not under contract.

At least on some fronts, there could be opportunity to push for more space. For instance, when Express Scripts released its 2018 formulary, it noted that product placement for inflammatory conditions "is under consideration and changes may occur based upon changes in market dynamics and new product launches."

However, the formulary listed Remicade – along with Actemra, Cosentyx, Enbrel, Humira, Otezla, Simponi, Stelara and Xeljanz – as preferred alternatives for inflammatory conditions. It listed all other brands as nonpreferred and required patients to try one or more of the preferred drugs before they would be covered for a nonpreferred one unless, perhaps, they already were established on a nonpreferred drug.

Editor's note: For an in-depth look at regulatory and competitive issues facing biosimilars, download Clarivate Analytics' report Biosimilars: Opportunities and Challenges in the EU, U.S. and Russia.