AstraZeneca Latest to Sue Biden Administration Over IRA’s Drug Price Negotiations

Pictured: AstraZeneca's San Francisco office/iStock, hapabapa

Pictured: AstraZeneca's San Francisco office/iStock, hapabapa

AstraZeneca has joined a growing list of drugmakers suing the Biden administration over a provision in the Inflation Reduction Act that allows the federal government to negotiate Medicare drug prices, the company announced Friday.

The British drugmaker is the latest pharma company to file a legal complaint. Boehringer Ingelheim filed a lawsuit Aug. 18, arguing that Medicare price negotiations under the IRA violate the company’s constitutional rights to due process, protection against excessive fines and free speech.

Other companies—including Merck, Bristol Myers Squibb, Johnson & Johnson and Astellas—that have sued the U.S. government over the IRA have focused on constitutional arguments. Similarly, the lobbying group Pharmaceutical Research and Manufacturers of America filed a suit challenging the constitutionality of the law.

However, AstraZeneca has taken a different approach in its legal complaint filed Aug. 25 in the U.S. District Court for the District of Delaware, claiming that the “drug price negotiation provisions of the IRA run headlong into the goals of the Orphan Drug Act.”

Dave Fredrickson, executive vice president of AstraZeneca’s oncology business unit, said in a statement that “rare disease and cancer patients depend upon high-risk, low-probability drug development that takes many years to develop and aims for cure” and that if the IRA provisions stand as enacted U.S. patients “with rare conditions, who have benefited from the Orphan Drug Act, will get delayed access to scientific breakthroughs relative to other parts of the world.”

AstraZeneca in Friday’s announcement called for a “re-examination” of the IRA’s “unintended consequences” for cancer and rare disease patients.

Orphan drugs are only exempted from IRA negotiations if they have a single indication, meaning drugs like AstraZeneca’s Lynparza that have multiple indications are still eligible for price negotiations. AstraZeneca stated in its press release that if the IRA had existed earlier, the company would have been disincentivized to pursue additional indications.

It’s not just Lynparza that would potentially be impacted by the IRA, according to AstraZeneca. A research letter cited in AstraZeneca’s press release states that a quarter of orphan drugs approved between 2003 and 2022 had multiple indications approved, often for other rare conditions. Beyond orphan drugs, research has estimated that the IRA may reduce available funds for R&D spending, and therefore the number of drug approvals.

The filing of AstraZeneca’s lawsuit comes just days before the Biden administration could announce the first 10 drugs selected for Medicare price negotiations. Politico reported last week that the White House on Aug. 29 is expected to unveil the names of the targeted prescription drugs—though, the government has until Sept. 1 to finalize the list.

Negotiations are expected to begin in 2024 and new prices are expected to take effect in 2026. The Congressional Budget Office has predicted that the program will save billions of dollars for the government. A Journal of Managed Care and Specialty Pharmacy brief predicted that the minimum savings from Janssen’s Imbruvica, Amgen’s Enbrel, Pfizer’s Ibrance and Astellas’ Xtandi alone would add up to $1.8 billion.

Nadia Bey is a freelance journalist from North Carolina. She can be reached at beynadiaa@gmail.com.

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