Pharma Group Seeks Early Win in Drug Price Negotiations Suit

The leading trade group representing the brand-name pharmaceutical industry late Thursday urged a federal judge to toss out the Medicare agency’s drug price negotiation program.

The Pharmaceutical Research and Manufacturers of America filed the request for summary judgment in the US District Court for the Western District of Texas.

The group, along with the National Infusion Center Association and the Global Colon Cancer Association, said they want a judge to issue a decision on their three claims against the drug price negotiation program put in place by the Inflation Reduction Act. They say the program violates the separation of powers and nondelegation doctrine, the Fifth Amendment’s due process clause, and the Eighth Amendment’s prohibition on excessive fines.

“If allowed to stand, this law will dramatically slow innovation, reduce the availability of new medicines, and undermine public health, causing grave harm to patients, pharmaceutical manufacturers, and healthcare providers,” the groups said in their filing.

The legal challenge is one of six lawsuits seeking to topple Medicare’s new authority to negotiate the prices of some of the drugs it spends the most on. The Congressional Budget Office has estimated the negotiations will save Medicare roughly $100 billion over 10 years. The Biden administration has touted the law as a key achievement that will help lower what Americans pay for prescription drugs.

The pharmaceutical industry argues the program unconstitutionally forces the companies to drive down prices for their products and that the negotiations will do little to lower patient costs.

Merck & Co., which last month filed a motion for summary judgment in its own case challenging the IRA, compared the negotiation process to “when a regime forces political prisoners to accept responsibility at show trials before they are shipped to the gulag.”

The US Chamber of Commerce and several state and local affiliates also are challenging the program in federal court, and have asked a judge to issue an order pausing the negotiations while the litigation proceeds. The Biden administration is scheduled to file by Friday a response to this preliminary injunction request, as well as a separate motion to dismiss for lack of subject matter jurisdiction.

The Centers for Medicare & Medicaid Services must publish by Sept. 1 the list of the first 10 Part D drugs for which drugmakers must lower their prices starting in 2026. The Chamber wants the Southern District of Ohio to act before Oct. 1, when drug manufacturers subject to the first round of negotiations must sign agreements to enter the price talks or risk financial penalties.

The case is Nat’l Infusion Ctr. v. Becerra, W.D. Tex., No. 1:23-cv-00707, motion for summary judgment filed 8/10/23