In a settlement announced June 7, 2007, the Patented Medicine Prices Review Board (PMPRB) and Janssen-Ortho Inc. have reached agreement to resolve issues involving the price of Risperdal Consta. By approving the settlement in the form of a Voluntary Compliance Undertaking (VCU) by Janssen-Ortho, the PMPRB concluded proceedings it had commenced when it issued a Notice of Hearing in January 2006.

Risperdal Consta is a new formulation of Risperdal (risperidone), an anti-psychotic agent indicated for the management of the manifestations of schizophrenia and related psychotic disorders. The oral dosage form of Risperdal has been sold in Canada by Janssen-Ortho since 1993. Risperdal Consta is a new dosage form of Risperdal; it is a prolonged release suspension for injection and was introduced in Canada in September 2004.

The VCU represents a negotiated settlement between Janssen-Ortho and the Board. Under the VCU, Janssen-Ortho agreed to a benchmark maximum non-excessive price (MNE) for Risperdal Consta that is significantly below the medicine's introductory price though approximately 50% higher than the MNE initially sought by the PMPRB Staff. Also under the VCU, Janssen-Ortho has agreed to take measures to offset the difference between the prices charged in the past and the new agreed-upon prices. It will make a payment to the Government of Canada of close to $4.5 million for the period of more than two years from September 2004 to the end of 2006 and will take other measures as necessary to offset any differences in 2007 until the effective date of the price reduction.

In the VCU, Janssen-Ortho notes its disagreement with the initial positions of Board Staff and the Board's Human Drug Advisory Panel (HDAP). In Janssen-Ortho's view, Risperdal Consta represents a substantial improvement over existing therapies and it disputed the comparative dosages proposed by the HDAP as being inconsistent with medical practice. Interestingly, Janssen-Ortho notes that Risperdal Consta is priced at a higher level than the comparator medicines proposed by Board Staff in all of the PMPRB's reference countries and that the price initially proposed by Board Staff would have been significantly lower than the lowest price in those countries.

This is the second settlement in less than a month announced by the Board. On May 24, it terminated proceedings against 3M Canada Company concerning the price of Airomir (salbutamol sulphate) which is used in the symptomatic management of asthma. In that case, 3M Canada made a VCU to pay approximately $485,000 to the Government of Canada to offset the difference between the actual prices of Airomir and the maximum non-excessive price alleged by Board Staff during the period from 2004 to December 2006. 3M Canada ceased selling Airomir in December 2006 when it sold its rights to that drug to Graceway Canada Company.

Of the eight hearings commenced by the Board in the past 18 months, six are ongoing.

For more information from the PMPRB on the Risperdal Consta matter, please see:

http://www.pmprb-cepmb.gc.ca/english/view.asp?x=271&id=92

For information on the Airomir matter, please see:

http://www.pmprb-cepmb.gc.ca/english/view.asp?x=271&id=89

For the PMPRB's hearing schedule, please see:

http://www.pmprb-cepmb.gc.ca/english/View.asp?x=707&mp=254