UPDATE 2-French antitrust watchdog probes Roche and Novartis over eye drug

Thu Apr 10, 2014 6:57am EDT

Related Topics

* French regulator probes Swiss firms over wet AMD treatments

* Searches offices on suspicion of anti-competitive practices

* Both firms say are co-operating with the authorities

* Roche denies companies colluded to restrict competition (Adds treatment details, costs, background, fine)

By Andrew Callus and Caroline Copley

PARIS/ZURICH, April 10 (Reuters) - France's competition authority is investigating drugmakers Roche and Novartis on suspicion they were involved in anti-competitive practices in relation to eye disease treatments, the companies said on Thursday.

This is the second time in as many months that the Swiss drugmakers have faced regulatory scrutiny over treatments for wet age-related macular degeneration (AMD)- a leading cause of blindness among the elderly.

In March, Italy's antitrust authority alleged the firms had colluded to prevent doctors prescribing Roche's cancer drug Avastin for AMD in favour of the more expensive drug Lucentis marketed by both Roche and Novartis. It fined the companies 182.5 million euros ($254.2 million).

A statement on the French authority's website said it had conducted "search and confiscation" operations on April 8 in relation to treatments for wet AMD, but it did not name the companies involved.

Spokeswomen for both Roche and Novartis confirmed the French authorities had started an investigation regarding treatments for the eye condition and said they would cooperate fully.

Roche denied that the two companies had colluded: "Roche confirms there is no agreement between Roche and Novartis that restricts competition."

The latest probe underscores how cash-strapped governments are scrutinising the way drug companies market and sell their products.

Italy's competition authorities say the alleged collusion may have cost the Italian health service millions of additional euros for treatment.

Last month, prosecutors in Rome opened an investigation into four executives at the Swiss drugmakers on suspicion of fraud and manipulation of the pharmaceutical market, according to judicial sources.

Although Roche's Avastin is not approved as a treatment for AMD, it works in a similar to way to Lucentis and costs around 30 euros a dose in France versus the 900 euros charged for an injection of Lucentis.

Therefore some doctors in the United States and Europe prescribe the cancer drug on a so-called "off label" basis, sparking a row between healthcare authorities and the companies over cost versus patient safety.

A closely-watched U.S. government-sponsored study in 2011 concluded that Avastin worked as well as Lucentis in treating vision loss from wet AMD but that it had more adverse side effects.

The two companies have always discouraged substituting Avastin for Lucentis, saying the two drugs were developed for different therapeutic purposes.

In 2012, Novartis challenged the use of Avastin as a treatment for AMD in some British hospitals, saying doing so put cost savings ahead of patient needs. But critics say Novartis and Roche have split the market to maximise profits.

Lucentis is marketed by Novartis outside the United States and is the company's third-biggest seller with sales of $2.38 billion last year. Sales of Lucentis for Roche, which markets the treatment in the United States, were 1.9 billion. ($1 = 0.8807 Swiss Francs) ($1 = 0.7234 Euros) (Additonal reporting by Chine Labbe and Natalie Huet in Paris.; Editing by Pravin Char and Elaine Hardcastle)

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