Johnson & Johnson's Suit Against Amgen: An Act of Desperation? (JNJ, AMGN)

 |  Includes: AMGN, JNJ
by: BioBlogger

On October 11th, Johnson & Johnson (ticker: JNJ) filed a lawsuit against Amgen (ticker: AMGN) alleging the latter is using its monopolistic power in G-CSF (i.e., Neulasta and Neupogen) to force buyers to purchase Amgen's Aranesp over JNJ's Procrit. JNJ is claiming that Amgen is imposing steep penalties on oncology clinics that do not purchase up to 75% of their EPO drugs (i.e., Aranesp, Epogen and Procrit) from Amgen. JNJ is claiming that clinics have no other choice but to purchase Amgen's EPO products; otherwise, the clinics will have to purchase a G-CSF product at a level that would be greater than the cost to purchase the drug.

What Amgen is doing is called "bundling", and it is a common practice among biotechnology, pharmaceutical and medical technology companies. Yes, even JNJ bundles products. JNJ is making a last ditch attempt to retain some market share for Procrit by employing this dubious legal maneuver. JNJ is effectively saying that since they have nothing to bundle with Procrit, then Amgen should not be allowed to do so in the name of "fairness". Come on JNJ, this is the United States, bastion of capitalism - if you don't like competition, then perhaps you should move the corporate headquarters to France.

JNJ chart.

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