By Saumya Joseph

(Reuters) – Catalyst Pharmaceuticals Inc, which has come under fire for the high price tag on its rare disease drug, on Wednesday sued the U.S. Food and Drug Administration to challenge the recent approval of a lower-cost rival drug.

The lawsuit alleges that the approval of Ruzurgi, a rival drug from privately held Jacobus Pharmaceutical Co, in May violated provisions of FDA regulations and Catalyst’s rights to exclusivity for its drug, Firdapse.

For years, patients were able to access the same drug for free from Jacobus, a small, family-run company in New Jersey, through an FDA program called “compassionate use”.

The approval of Firdapse, which was not originally developed by Catalyst, last year put an end to that. The company priced the treatment at $375,000 a year, drawing widespread criticism, including from presidential candidate and U.S. senator Bernie Sanders.

Jacobus’ treatment is priced at less than half that cost, at about $175,200 annually, according to the lawsuit.

Both drugs are approved to treat Lambert-Eaton myasthenic syndrome, but Firdapse was approved for adults, while Jacobus’ drug was for children.

But the unexpected approval of Ruzurgi potentially enables adults to use it off-label, which would likely erode Firdapse’s market share.

“We think perhaps the FDA was improperly influenced by political pressure regarding high drug prices and we also feel that this is a horrible precedent for companies that are developing drugs to treat rare diseases,” Catalyst Chief Executive Officer Patrick McEnany told Reuters.

“If it is used according to label, which is for pediatric patients, it won’t affect our market at all.”

Catalyst, which filed its lawsuit in the United States District Court for the Southern District of Florida, said it was seeking to reverse the FDA decision.

An FDA spokeswoman declined to comment.

Shares of Catalyst fell 1.7% to $3.50 and have lost about 40% of its value since Ruzurgi was approved last month.

(Reporting by Saumya Sibi Joseph and Tamara Mathias in Bengaluru and Michael Erman in New York; Editing by Arun Koyyur)