Roche Removes a Blemish: Drugmaker Drops Its One-Time Acne Blockbuster Accutane

Holding less than 5 percent of isotretinoin market and burdened with the costs of personal injury suits, Roche decides to discontinue its acne drug.

Citing generic competition and the cost of personal injury suits, Roche announced it would immediately be discontinuing distribution of its acne drug Accutane (isotretinoin).

"This decision is being taken for business reasons during a reevaluation of our product portfolio of medicines that are now available from generic manufacturers, and is not being taken for reasons of safety or efficacy," the company said in a June 26 statement.

Launched in 1982, Accutane was once one of Roche's top-selling drugs. Since generic formulations entered the market in 2002, however, Roche said its market share has fallen to below five percent. According to data presented at an FDA advisory committee meeting in 2007, an estimated 495,231 patients were exposed to isotretinoin in 2000, but only 284,305 in 2005. Last year, people filled roughly one million prescriptions of isotretinoin.

Roche noted that Barr, Genpharm, Mylan and Ranbaxy currently manufacture isotretinoin and will be able to supply the market. Still, dermatologists were surprised by the move.

"I think it's very extraordinary," said Stephen Stone, past president of the American Academy for Dermatology and current chair of the organization's retinoid task force. "If it weren't for the fact isotretinoin is available from other companies, this would be a real disaster for teenagers and others with severe acne and for those with orphan diseases that do respond to isotretinoin."

Innovator companies do not often pull drugs because of generic competition. Bristol-Myers Squibb discontinued its antidepressant Serzone (nefazadone) in 2004 citing generic erosion. It said the decision was not over safety issues, although the drug had been associated with hepatic failure ("The Pink Sheet," May 20, 2004).

Courts Have Issued Mixed Rulings On Accutane

In addition to generic competition, Roche said the high cost of product liability litigation factored in its decision to drop the drug. More than 500 lawsuits have been filed in federal and state courts claiming Accutane caused irritable bowel disease, and additional suits have been filed claiming the drug caused depression and suicide. The company has had mixed results in court. The 15 federal IBD cases were consolidated in multidistrict litigation (MDL) proceedings. In 2007, a court granted summary judgment in the lead case, which was upheld on appeal.

The bulk of the IBD cases are in state court. Roche has lost in the four trials held to date, although a New Jersey court vacated one of those verdicts in March and ordered a new trial (¹ (Also see "Roche Gets Second Chance In Accutane Liability Suit; Pre-emption Still Possible" - Pink Sheet, 23 Mar, 2009.)). The company won a suicide case brought by the wife of Rep. Burt Stupak, D-MI. Their 17-year old son committed suicide while taking Accutane. A district court ruled that the drug's suicide warnings were sufficient and Stupak could not demonstrate proximate causation. An appeals court upheld the ruling in June. Roche declined to disclose its litigation costs.

Tim O'Brien, an attorney at Levin Papantonio Thomas Mitchell Echsner & Proctor, said he thought Roche was wise to discontinue the drug. "The market is drying up and the liability sheet is getting heavier than the asset sheet," he said. He estimated that Accutane now generates less than $100 million per year, while the company is losing $15-20 million in verdicts every year.

O'Brien, a member of the litigation group executive committee for the New Jersey coordinated litigation and discovery committee chair in the MDL cases, added that Roche's decision would not impact current litigation.

Rick Meadow, of The Lanier Law Firm, who is also representing plaintiffs in Accutane litigation, said Roche may now get a universe, or defined number, of cases since patients will stop taking Accutane and the statute of limitations will run out.

Roche Gets Free of iPledge Worries

Roche is also moving away from primary care, which would provide another impetus to let go of a problematic drug that is no longer that profitable. The company indicated it was adopting a new focus when it withdrew from the Pharmaceutical Research and Manufacturers of America. It said the Biotechnology Industry Organization was more closely aligned with the direction Roche was taking following its merger with Genentech.

In addition, by dropping Accutane, Roche will free itself of the hassles of dealing with "iPledge," the isotretinoin risk management program. The program is designed to control access to the drug for female patients of childbearing potential, given the drug's known teratogenic effects, by requiring them to commit to monthly pregnancy tests and to answer patient education questions. Roche said it would continue to work with FDA and isotretinoin manufacturers on issues related to the program and for the eventual transition of all of iPledge management to the remaining sponsors.

Operational expenses for the iPledge program, launched in 2006, are allocated based on prescription market share of each manufacturer so Roche said it was contributing only a small part in recent years although its regulatory, legal and drug safety teams have been very active.

Brenda Sandburg (² [email protected])