Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Action Alleges Reckitt Benckiser Shut Out Generic Competition for Opioid Replacement Drug, (May 7, 2013)

By Tobias J. Gillett, J.D., LL.M.

I.B.E.W. 292 Health Care Plan, a Minnesota multiemployer welfare fund, has filed a putative class action complaint in the federal district court in Philadelphia, asserting that health care product producer Reckitt Benckiser, Inc. violated a variety of state antitrust laws by engaging in a range of anticompetitive conduct intended to suppress competition to its Suboxone branded pharmaceutical product (I.B.E.W. 292 Health Care Plan v. Reckitt Benckiser, Inc., May 3, 2013).

According to the complaint, Reckitt’s Suboxone product, a drug intended for use in opioid replacement therapy, consisted of co-formulated buprenorphine hydrochloride and naloxone hydrochloride dehydrate, two drugs no longer under patent. However, the FDA did grant Reckitt a seven-year period of exclusivity in Suboxone by categorizing it as an "orphan drug." That period was set to expire on October 8, 2009.

However, Reckitt engaged in a series of anticompetitive actions to extend its period of control over co-formulated buprenorphine/naloxone, according to the complaint. Reckitt’s first step allegedly consisted of the development of a film version of Suboxone, a version that had only "clinically insignificant" differences from the previous tablet version. The complaint asserts that the film version was actually inferior to the tablet version because its increased naloxone availability risked "unwanted precipitation of opioid withdrawal," it was easier to divert and abuse, it was more dangerous for children who accidentally ingested it, its packaging was less child-resistant, and its film formulation was more irritating to a patient’s oral mucosa than the tablet. The film was also more expensive and difficult to manufacture than the tablet.

Despite the greater cost to Reckitt of producing the film version, however, Reckitt allegedly introduced it because it did not have imminent generic competition. To ensure that the market would switch from the tablet version to the film version before generic competition for the tablets arrived, Reckitt attempted to destroy demand for the tablet version by raising the price for the tablets; declining to package Suboxone tablets in childproof unit-dose packaging, despite acknowledging that such packaging was "feasible," in order to reduce their relative quality; falsely disparaging tablets to doctors through its sales force; and finally announcing that it would discontinue sale of tablets. These actions allegedly destroyed demand for tablets by the time generic manufacturers began selling tablets, resulting in more prescriptions written for the film version than for tablets.

In addition, the complaint claims Reckitt delayed generic competition by "sabotaging" the process under which generic manufacturers would obtain approval of their co-formulated buprenorphine/naloxone products. To obtain Food and Drug Administration approval of their Abbreviated New Drug Applications (ANDAs), generic manufacturers would have to submit a shared Rick Evaluation and Mitigation Strategies (REMS) for Suboxone tablets in cooperation with Reckitt. Reckitt allegedly stalled the process by feigning cooperation, refusing to participate in meetings, refusing to discuss substantive issues in meetings it did attend, placing conditions on its participation that the generic manufacturers could not agree to, refusing to share essential information, raising a last-minute issue immediately before the REMS was to be submitted, and finally ceasing to participate altogether.

Reckitt also allegedly delayed generic manufacturers’ entry to the market by filing an "objectively baseless" citizen petition with the FDA asking it to withhold approval until "(1) the ANDA contains a targeted pediatric exposure education program, (2) the ANDA product has child-resistant unit-dose packaging, and (3) the FDA determines that Reckitt did not discontinue marketing branded Suboxone tablet for reasons of safety." The complaint notes that Reckitt had not included a pediatric education program in its own application, and the FDA had no authority to require ANDA filers "to create labeling or REMS materials different than that approved for the reference drug." Moreover, Reckitt allegedly knew that unit-dose packaging would not reduce pediatric exposure to the drug, and such packaging fell within the exclusive jurisdiction of the Consumer Product Safety Commission. Finally, Reckitt was not removing the drug for reasons of safety.

The structure of the pharmaceutical marketplace facilitated Reckitt’s anticompetitive conduct, according to the complaint. Drugs such as co-formulated buprenorphine/naloxone have to be prescribed by physicians, who are typically not aware of the relative costs of branded pharmaceutical products. "[U]nscrupulous brand manufacturers" anticipating generic competition can avoid it by obtaining FDA approval of a modified version of their drug, and then using anticompetitive tactics to convince doctors to only prescribe the modified version. The generic version will then receive few sales, because the generic version will not be substitutable for the modified version for which a patient has a prescription.

According to the complaint, Reckitt’s anticompetitive conduct has permitted it to maintain a 100%share in the market for co-formulated buprenorphine/naloxone. The complaint asserts that Reckitt’s conduct violated the laws against monopolization of 22 states, and the laws against attempted monopolization of 24 states.

The case is No. 2:13-cv-02454-MSG.

Attorneys: Ira Neil Richards (Trujillo Rodriguez & Richards, LLC) for I.B.E.W. 292 Health Care Plan.

Companies: I.B.E.W. 292 Health Care Plan; Reckitt Benckiser, Inc.

News: Antitrust PennsylvaniaNews