WASHINGTON (Reuters) -Democratic U.S. Senator Maggie Hassan said on Friday she is launching an investigation into British pharmaceutical giant GlaxoSmithKline's decision to discontinue a widely used asthma inhaler for children.

In letters sent on Friday to GSK and its authorized generic distributor, Prasco Laboratories, and seen by Reuters, Hassan said the decision to remove Flovent HFA from the market in January 2024 had contributed to a spike in hospitalizations and deaths linked to asthma complications.

She demanded documents detailing the rationale behind the decision, and its financial and health impacts.

Hassan, the top Democrat on the Senate Finance Committee's Health Care Subcommittee, called on GSK to restore the inhaler to market. She also requested internal pricing documents, rebate data, and communications with regulators by July 18.

She accused GSK of evading rebate obligations to Medicaid, which provides health coverage to 71 million low-income people and is one of the biggest U.S. safety-net programs. In addition, GSK's decision to replace the brand-name inhaler with a higher-cost authorized generic had lowered access for low-income patients, Hassan said.

"Children across the country have faced life-threatening medical challenges and families have grappled with more expensive or less effective alternative medications - when these options are available at all," Hassan wrote in her letter.

GSK told Hassan in response to an earlier letter she sent in May last year that Prasco controls pricing of the generic. Hassan said both companies failed to ensure affordability of the treatment, contributing to delays or denials of insurance coverage.

Hassan cited a Johns Hopkins analysis which found that GSK's move saved the company $367 million in 2024 Medicaid rebates, while costing the program over $550 million. Parents reported paying up to $150 per inhaler for the generic, compared to $10 for Flovent.

GSK said last year it would cap out-of-pocket costs for all its inhaled asthma and chronic lung disease medicines at $35 per month for eligible patients in the United States starting January 2025, following similar moves by its rivals.

The announcement came after lawmakers criticized manufacturers over high prices, and launched an investigation to look into the prices at which these were sold in the U.S. versus other countries.

(Reporting by Ahmed Aboulenein; Editing by Lincoln Feast.)