Pharma’s Challenge to Drug Price Excise Tax Sits on Shaky Ground

Legal challenges by two major trade groups citing “excessive fines” in Medicare’s new drug price negotiation plan are the least likely of their constitutional arguments to bear fruit as lawsuits in several courts move forward, lawyers and academic experts say.

Pharmaceutical companies would face a steep excise tax if they refuse to comply with government price negotiations set up under the Inflation Reduction Act. The US Chamber of Commerce and several state and local affiliates, as well as drug industry trade group the Pharmaceutical Research and Manufacturers of America, are challenging the law in court, arguing that the tax violates ...