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Covid vaccine maker AstraZeneca has sued the US government over legislation designed to lower prescription drug prices.
Britain’s largest pharmaceutical group has challenged President Joe Biden’s Inflation Reduction Act (IRA), which allows the US government to negotiate prices on behalf of members of its national health insurance programme, Medicare.
The new rules are expected to save Medicare $100bn by 2031 and came in response to public pressure to lower drug prices for its patients, who are typically older or disabled.
However, medicine manufacturers have complained that lowering the price of prescription drugs will reduce profits and hinder research into new therapies.
AstraZeneca claimed that it has already been forced to cut investment into rare diseases and cancers because of the (IRA), Bloomberg reported.
The United States represented about 40pc of AstraZeneca’s $44.4bn in revenue last year.
The complaint follows legal action taken by US pharmaceutical giants Johnson & Johnson, Merck & Co. and Boehringer Ingelheim.
David Fredrickson, executive vice president of oncology at AstraZeneca, has warned against the IRA’s “unintended set of consequences” on American patients.
This includes those who have benefitted from America’s Orphan Drug Act, which is designed to incentivise pharmaceutical companies to develop remedies for rare diseases, such as Huntington’s disease, ALS, and Tourette’s syndrome.
Mr Fredrickson said: “Rare disease and cancer patients depend upon high-risk, low-probability drug development that takes many years to develop and aims for cure.
“If today’s version of the law stands, patients in the United States 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.”
A spokeswoman for the US Department of Health and Human Services, which oversees Medicare, said: “We will vigorously defend the president’s drug price negotiation law, which is already helping to lower healthcare costs for seniors and people with disabilities. The law is on our side.”
AstraZeneca has spent billions of dollars in recent years expanding its rare disease expertise through a string of acquisitions, as the Anglo-Swedish group searches for new sources of revenue.
The Cambridge-based company bought rare disease specialist Alexion Pharmaceuticals for $39bn in 2021.