UK-based pharmaceutical giant AstraZeneca (AZ, NASDAQ: AZN) has filed a legal claim against the US government’s plan to negotiate the price of selected drugs for the 2026 period onwards through the elderly health insurance program, Medicare. This move makes AstraZeneca the fourth company to contest the initiative this year, following Merck, Sharp & Dohme (MSD; NYSE: MRK), Bristol-Myers Squibb (BMS, NYSE: BMY), and Johnson & Johnson (J&J; NYSE: JNJ).
AstraZeneca’s Argument Against Price Negotiations
AstraZeneca argues that the federal project contradicts a four-decade-old act aimed at encouraging the development of orphan drugs through incentives to pharmaceutical companies. The company contends that a price-setting scheme could delay access to medicines designed for rare diseases, which may later receive approval for broader indications. This concern is underscored by the examples of AstraZeneca’s own oncology drug Lynparza (olaparib) and neuromuscular and hematological diseases treatment Soliris (eculizumab), both of which have expanded their indications beyond rare diseases.
Potential Impact on Orphan Drug Development
The legal challenge by AstraZeneca highlights the broader debate over the balance between making medicines affordable through government negotiations and maintaining incentives for pharmaceutical companies to develop drugs for rare diseases. The outcome of this claim could have significant implications for the pharmaceutical industry and the future of drug pricing and access in the US.-Fineline Info & Tech
