| NEW YORK, April 13
NEW YORK, April 13 Johnson & Johnson and
Schering-Plough Corp said on Monday that Canadian regulators
had approved use of their experimental once-monthly drug
Simponi to treat moderate to severe rheumatoid arthritis.
The potential blockbuster medicine, awaiting approval in
the United States and Europe, is a follow-up to the widely used
Remicade treatment sold by the two drugmakers.
Simponi could turn out to be a high-stakes bone of
contention in Merck & Co's (MRK.N) planned $41 billion purchase
of Schering-Plough because Merck has said it will inherit
overseas rights to Simponi and Remicade. Under an earlier
marketing deal with J&J, Schering-Plough is obliged to return
overseas rights to J&J if control of Schering-Plough changes.
J&J (JNJ.N) has exclusive rights to sell the new injectable
treatment in the United States. Schering-Plough, SGP.Nwhich
has rights in most other markets, said it hopes to introduce
Simponi in Canada during the second half of the year.
Canadian authorities also approved Simponi for active
psoriatic arthritis, an inflammatory condition of the skin and
joints, and ankylosing spondylitis, a chronic inflammatory
arthritis of the spine.
Remicade, a decade-old drug given by intravenous infusion
every eight weeks, which can cost more than $20,000 a year,
also treats those three conditions. Like Simponi, it works by
blocking tumor necrosis factor (TNF), an inflammation-causing
In one large study, Simponi reduced arthritis symptoms by
at least 20 percent among patients who had previously failed to
benefit from standard anti-TNF medicines.
Researchers said it was the first time an anti-TNF medicine
was shown to help patients who previously had failed to benefit
from a member of the same family of drugs. Other big-selling
anti-TNF treatments include Abbott Laboratories Inc's (ABT.N)
Humira and Wyeth's WYE.N Enbrel.
"Simponi is the first biologic therapy to be approved
concurrently in three distinct rheumatologic diseases," the
companies said in a release. The drug is also known by its
chemical name, golimumab.
Merck is slated to buy Schering-Plough later this year.
The deal was structured as a "reverse merger," meaning
Schering-Plough technically would acquire larger Merck even
though Merck is paying it $41 billion.
The strategy would allow Schering-Plough to claim it is a
continuing enterprise, and therefore has not undergone a change
in control that would force it to give up overseas rights to
the two arthritis drugs.
J&J could hold up the merger by trying to recover the
overseas rights, according to some analysts, and thereby have
leverage to exact concessions from Schering-Plough and Merck.
J&J has steadfastly declined to comment on the matter, but
investors could get a glimpse of J&J's game plan when the
company reports first-quarter earnings on Tuesday.
(Reporting by Ransdell Pierson; Editing by Toni Reinhold)