Cannot make requests from a lambda function to private API endpoint when the IAM Auth is enabled on the API endpoint.

I have set a an API gateway with private endpoint which invokes a lambda function A. I have another lambda function B, which call the private endpoint (runs inside vpc, connects to vpc endpoint to API gateway). Without having the IAM Auth enabled for this endpoint, I could make requests succesfully from my lambda function B to the API endpoint. When I enable IAM Auth for the endpoint,the requests from my lambda function B to private API endpoint was unsuccessful (Missing Authentication Token error).The lambda function B has an IAM role with all permission to invoke API endpoint. What am I missing here?

Lambda function:

import json 
import requests

def lambda_handler(event, context):
    url = "https://api-id.execute-api.region.amazonaws.com/dev/pets"
    headers = {"content-type": "application/json"}
    response = requests.get(url, headers=headers)
    print(response.text)

Resource policy on API gateway:

{
  "Version": "2012-10-17",
  "Statement": [
    {
      "Effect": "Allow",
      "Principal": "*",
      "Action": "execute-api:Invoke",
      "Resource": "arn:aws:execute-api:region:acc-id:api-id/*"
    },
    {
      "Effect": "Deny",
      "Principal": "*",
      "Action": "execute-api:Invoke",
      "Resource": "arn:aws:execute-api:region:acc-id:api-id/*/*",
      "Condition": {
        "StringNotEquals": {
          "aws:SourceVpce": "vpce-xxxxxxx"
        }
      }
    }
  ]
}

TIA!