Drug maker Novartis is taking legal action in Britain to make state-run hospitals use an eye drug that costs about $1,120 per shot instead of a cheaper one that costs just $95.
In a statement, Novartis said it was calling for a judicial review "as a last resort" because it believed patient safety was being potentially compromised.
According to Britain's health watchdog, Novartis' Lucentis is the only drug recommended to treat the eye problem macular degeneration in the country's state-run National Health Service hospitals.
However, several NHS hospitals have been prescribing the much cheaper Avastin, a cancer drug made by Genentech Inc., for the same problem even though it has not been officially approved.
Last year, the Canadian Council of the Blind also said provincial governments should be funding the approved drug for age-related macular degeneration, Lucentis.
Since 2008, about 120 Canadians have had serious eye inflammation after receiving injections of Avastin, Dr. Alan Berger, ophthalmologist in chief at St. Michael's Hospital in Toronto, said at the time.
Most doctors only prescribe drugs approved by the health watchdog, but have the discretion to use other treatments if they believe they are warranted.
Last year, four hospitals in southern England decided they would pay for Avastin when it was prescribed by a doctor.
In a statement Tuesday, Novartis AG said it was demanding a judicial review to make the hospitals use Lucentis rather than Avastin.
Novartis said it was concerned patients and clinicians were being pushed to use an unlicensed medicine in order to cut costs.
Britain's coalition government has mandated that its National Health Service trim 20 billion pounds from its budget by 2015 as part of a national austerity drive.
"It is unacceptable to put the safety of patients at risk through the widespread use of an unlicensed treatment when a licensed medicine is available," the pharmaceutical company said.
Novartis noted there was "emerging evidence" of safety concerns for using Avastin to treat eye problems.
Patient groups called for an independent analysis to determine which drug should be used. "If Avastin is not as safe as Lucentis, no one should be using it," said Helen Jackman, chief executive of the Macular Disease Society. "If it is as good, perhaps everyone should be using it."
Jackman said government ministers should hold an appraisal of whether Avastin was safe to use in eye diseases. Eye doctors are divided over whether Avastin is as safe and effective as Lucentis, she said.
Other critics slammed Novartis for their decision to go to the courts.
"Companies like Novartis should not be in the position to block moves to more cost-effective treatments in order to maximize their profits," said John Harris, of the Institute for Science Ethics and Innovation at the University of Manchester, in a statement. He said it was legitimate for health providers to use treatments that were much cheaper than ones that were already licensed.