under the scanner

Competition Commission of India pulls up Roche for anti-competitive practices

In a landmark order, the commission has initiated an investigation into the multinational pharmaceutical company’s activities.

The Competition Commission of India has initiated an investigation into Swiss pharmaceutical giant Roche for unfair business practices. Roche has been found, prima facie, of misusing its dominant status to keep competition out for its breast cancer medicine Trastuzumab.

In July 2016, Mylan Pharmaceuticals and Biocon Limited had approached the Competition Commission of India alleging that Roche was indulging in anti-competitive practices to protect its monopoly on the drug. The commission has asked its director general of investigation to conduct an enquiry and submit a report in 60 days.

The complaint alleged that Roche, the second largest pharmaceutical company in the world by revenue, tried to influence regulatory authorities, indulged in anti-competitive activities such as raising unwarranted concerns regarding the safety and efficacy of biosimilars – biological products that are almost identical to another but manufactured by a different company and clinically no different in terms of safety and effectiveness. The complaint also alleged that Roche influenced regulatory standards and tender conditions and abused the legal process to stall approval and marketing of biosimilars.

Roche’s Trastuzumab is a biological drug made from cells of living organisms or their products. Biocon’s drug is a biosimilar. Roche had allegedly approached hospitals and doctors and raised questions about efficacy of biosimilars.

“Roche’s campaign against biosimilars, priced much lower than its own drug and therefore more accessible and affordable, is infamous,” said Kalyani Menon-Sen, Coordinator for Campaign for Affordable Trastuzumab. “There is a nexus between doctors and pharma companies.”

According to Menon-Sen, women getting treatment from private hospitals report that they are pressurised to use only Roche’s drug provided at the hospital. If they insist on purchasing the drug from outside at a cheaper price, or ask for the biosimilar, they are either refused treatment or are warned that the hospital will not be answerable for any adverse consequences.

The Competition Commission of India has made a similar observation. Referring to an ongoing Delhi High Court case in which Roche has challenged approval of Biocon’s product, the commission noted that Biocon has valid approval from the Drugs Controller General of India. The commission has stated that: “The practices adopted by Roche Group to create an impression about the propriety of the approvals granted, the safety and efficacy of biosimilars, the risk associated and the outcome of the on-going court proceedings in the medical fraternity, including doctors, hospitals, tender authorities, institutes etc… prima facie appear to be aimed at adversely affecting the penetration of biosimilars in the market.”

“Women seeking treatment are at their most vulnerable and they will go by what the doctor says, regardless of the costs,” said Menon- Sen. There is no scientific basis for the claim that the biosimilar is less effective than the Roche version.”

In an email reply to Scroll.in, a Biocon spokesperson said, “We welcome the decision of the Competition Commission of India. A fair and ethical competitive environment will enable access to affordable life-saving therapies to larger patient pools with unmet needs.”

The order cited example of misinformation by Roche to promote its product. On April 25, 2016 a single bench of the Delhi High Court ordered in favour of Roche in the civil suit against approval of Biocon’s biosimilar. However, three days later, the division bench reinstated the position prior to April 25 allowing Biocon’s biosimilar in the market. On some occasions, Roche used the earlier order to make its case. For example, in a letter dated June 3, 2016, written to the store officer of the All India Institute of Medical Sciences Roche cited the April 25, 2016 decision without revealing the later order.

Biocon, the developer of biosimilar, and Mylan, which is responsible for its marketing, are not the only companies who seem to be affected by Roche’s campaign. The Competition Commission of India’s 36-page order also notes that the Swiss giant has used legal pathways to delay entry of other biosimilars. Reliance Life Science’s biosimilar version of Trastuzumab under the brand name TrastuRel was approved for manufacturing and marketing in June 2015. However the drug could be launched only in May 2016 due to a legal suit filed against it by Roche in the Delhi high Court. Cadila Healthcare sought an injunction from the Bombay High Court before the launching its biosimilar Vivitra to pre-empt any action by Roche.

Punitive action

If the Competition Commission of India finds Roche’s conduct anti-competition, the company might have to pay a penalty.

“If Roche has indeed tried to influence hospitals, doctors and regulatory authorities regarding safety of Biocon’s product in the manner alleged, then it might be a serious breach of the Competition Act,” said Kabir Dixit, an advocate at the Supreme Court of India who regularly advises on competition law.

Referring to the commission’s broad powers to remedy any abuse of dominant position, Dixit said: “From directing the enterprise to discontinue the abuse to imposing penalty commensurate with the sort of benefits derived on account of such abuse. Penalties can be up to 10% of the average turnover for the last three preceding financial years. [The commission] even has the power to direct division of an enterprise enjoying dominant position.”

A spokesperson of Roche said, “We are reviewing the order and cannot comment at this point.”

Effect on patients

According to a 2016 study by the Indian Council of Medical Research, breast cancer is the most common cancer India. With 1.5 lakh new cases registered in 2016, breast cancer accounted for 10% of all cancer cases.

If treated early, the survival rate of breast cancer is as high as 89% as in developed countries, according to data from cancer registries in the United States.

However, in India, treatment is still out of reach for a majority of patients. Roche’s Trastuzumab was sold at Rs 1,20,000 for 440 mg from the year 2002 to 2012 . A course of 12 injections costs anywhere between Rs 6 lakh to Rs 8 lakh. In 2013, Roche launched a cheaper version of the same drug at Rs 75,000. In 2013, Biocon too launched its biosimilar at Rs 57,500. Subsequently Roche also brought down its price to the same level.

“Even though MRP remains the same, after negotiations with the company, the same drug is available at Rs 33,000,” said Menon-Sen. “This price is also unaffordable. All companies have to work towards reducing the prices even further down.”

She pointed out that even through the Competition Commission of India’s order is landmark in itself, the problem lies in the regulation of price in India, or rather the lack of it. “If it is left to the companies, we will never have decent pricing,” she said. “If the priority is public health, then the government has to set a price ceiling that makes the drug affordable to all.”

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