NEW YORK – AstraZeneca on Friday said it has filed a legal complaint against the US government alleging that the drug price negotiation provisions within the Inflation Reduction Act (IRA) conflict with the goals of the Orphan Drug Act and would harm patients with rare cancers and other diseases.
Provisions in the IRA, signed into law by President Joe Biden a year ago, empower Medicare to negotiate drug prices for the most expensive treatments on the market. However, AstraZeneca, which develops precision medicines, is asserting that this law "runs headlong" into the goals of the Orphan Drug Act, a 1983 law that incentivizes drugmakers to develop treatments for diseases affecting fewer than 200,000 people in the US. Garnering orphan drug designation for a product allows it to have market exclusivity upon regulatory approval, exempts the product sponsor from FDA application fees, and provides certain tax credits for qualified clinical trials.
According to AstraZeneca, the Orphan Drug Act made it possible for it to develop Lynparza (olaparib) and paved the way for its initial approval in 2014 as a late-stage ovarian cancer treatment for patients with BRCA1/2 mutations. The price control provisions in the IRA would disincentivize drugmakers from developing such treatments for rare indications, AstraZeneca argued.
"If the IRA had been in place, significant disincentives would have existed for pursuing the late-line ovarian cancer approval in the US, an indication which has benefitted patients in great need of this unique medicine for their rare condition," AstraZeneca said in a statement. AstraZeneca did not respond to a request seeking access to the legal complaint it has filed in the US District Court for the District of Delaware.
AstraZeneca also highlighted Soliris (eculizumab) — a treatment first approved by the FDA in 2007 for a rare chronic blood disorder and again in 2019 for refractory generalized myasthenia gravis patients who are anti-acetylcholine receptor antibody-positive — as another example of an orphan disease drug that the company wouldn't have been able to continue advancing into new indications if price controls were in effect.
In filing its legal challenge against the IRA, AstraZeneca said it wants to "protect timely access to medicines for orphan indications in the US" like Lynparza and Soliris.
"Rare disease and cancer patients depend upon high-risk, low-probability drug development that takes many years to develop and aims for cure," David Fredrickson, executive VP of AstraZeneca's oncology business unit, said in a statement. "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."
As written, the IRA would exempt agents with orphan drug designation from its negotiations list, but only in cases where the drug has a single approval for one indication. Drugs like Lynparza and Soliris, which initially benefitted from orphan drug designation, but then went on to net approvals in additional indications, would still be contenders for Medicare price negotiations.
Since Lynparza's initial approval in 2014, the US Food and Drug Administration has approved it for numerous other rare biomarker-defined subgroups of patients with advanced ovarian, breast, pancreatic, and prostate cancer.
Although the US Centers for Medicare & Medicaid Services (CMS) has not yet named the 10 drugs that it will negotiate prices for, the list is expected to include the most expensive drugs on the market, with certain exemptions. Lynparza's list price is $2,881.38 for a 56-pack of 150 mg tablets.
The blockbuster is AstraZeneca's second best-selling oncology drug, netting $2.64 billion in 2022, an 18 percent increase in sales compared to 2021.
AstraZeneca argues that protecting access to drugs like Lynparza, among other expensive orphan treatments, "will have minimal impact on the overall cost to the US healthcare system but a tremendous impact on patients."
The drugmaker is the latest in a growing list of pharmaceutical companies, trade organizations, and advocacy groups to challenge the IRA's Medicare price negotiation provisions. In June, for instance, Merck, which jointly markets Lynparza with AstraZeneca, announced it was suing the US Department of Health & Human Services, alleging that the price-setting negotiations are unconstitutional.
Johnson & Johnson, Astellas, Boehringer Ingelheim, and Bristol Myers Squibb have also filed lawsuits, as has the Pharmaceutical Research and Manufacturers of America, the industry trade group that represents drugmakers' interests.
CMS is expected to name the first 10 drugs subject to price setting on September 1.