(Bloomberg) -- Johnson & Johnson’s patent on its top-selling arthritis drug Remicade is invalid, a U.S. appeals court ruled Tuesday in a defeat to the drugmaker that just last week lost a patent on another blockbuster medicine.
The antibodies covered by this patent were already disclosed in an earlier patent, the U.S. Court of Appeals for the Federal Circuit said in a ruling posted on its electronic docket. The court upheld a decision from the U.S. Patent and Trademark Office, making J&J’s appeal of a similar decision from a federal judge moot.
J&J dropped as much as 4.2 percent after the court decision, the biggest intraday decline since August 2015, and was trading down 3.7 percent to $142.62 at 1:43 p.m. in New York.
The decision is a blow for J&J and its Remicade, which is the company’s top-selling drug. J&J’s fourth-quarter results released earlier Tuesday showed that the arthritis treatment is under pressure from competition from cheaper versions. Quarterly sales of Remicade dropped 9.7 percent to $1.47 billion, missing analysts’ estimates.
J&J said it was disappointed in the court’s ruling, which could have implications for other drugmakers because it hinged on how related applications should be handled at the patent office.
“We believe that biopharmaceutical intellectual property protections, such as patents and data protection, enable us to invest in the discovery and development of tomorrow’s life-changing and life-saving new medicines,” the company said in a statement.
The company said the drug has helped 2.6 million people worldwide and it’s “committed to helping ensure Remicade remains accessible and affordable to patients.”
The challenge to the patent was filed by Pfizer Inc.’s Hospira, which has exclusive U.S. marketing rights to a biosimilar called Inflectra made by Celltrion Inc., a South Korean drugmaker.
There are several biosimilars to Remicade already available in the U.S., including Pfizer’s Inflectra, which launched in late 2016. Inflectra sales have been slow, and Pfizer last year accused J&J of antitrust violations in how it’s selling Remicade.
Pfizer called the ruling “a good day for patients battling chronic diseases.”
“However, J&J continues to use their scheme of exclusionary contracts to maintain Remicade’s monopoly position that prevent patients, payers and providers from the opportunity to benefit from Inflectra,” Thomas Biegi, a spokesman for Pfizer, said in a statement.
Unlike a generic drug, which directly copies the recipe from the brand-name drug, developing a medicine based on a living organism involves greater testing and advanced manufacturing skills. A biosimilar piggybacks on some of the safety and efficacy tests of the drug that it’s copying, so it costs less to develop.
Had J&J won the appeal and had its patent revived, it could have demanded the makers of the biosimilars compensate it for any profits J&J lost to competitors. The company has another patent on Remicade that it’s using in litigation, though that’s been held up because of a dispute over whether Janssen had the legal right to file the case.
The loss before the nation’s top patent court came a week after J&J’s Janssen Biotech unit got hit with an invalidity ruling on another blockbuster, the cancer drug Zytiga. That decision was issued by the Patent Trial and Appeal Board, and J&J has pledged to appeal to the Federal Circuit in that case.
The case is In Re: Janssen Biotech Inc., 17-1257, U.S. Court of Appeals for the Federal Circuit (Washington).
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