Pharmaceutical Research and Manufacturers of America (PhRMA), along with the Global Colon Cancer Association and the National Infusion Centre Association, argue that the Medicare negotiations with drugmakers breach the U.S. Constitution, in a complaint filed in federal district court in Texas.
The largest lobby group in the pharmaceutical industry, PhRMA represents a variety of the largest pharmaceutical manufacturers globally, including Pfizer, Eli Lilly, and Johnson & Johnson.
However, the associations requested the court declare the programme unlawful and bar the Department of Health and Human Services from carrying out Medicare negotiations without “adequate procedural protections” for medication producers.
HHS, on the other hand, did not respond immediately to CNBC’s request for comment.
Additionally, it marks the fourth lawsuit challenging the controversial provision of the Inflation Reduction Act, which became law last summer with a major victory for President Joe Biden and Democratic policymakers.
The policy typically aims to make drugs more reasonable for older Americans but will eventually deduct pharmaceutical industry profits. Separate lawsuits were filed against the provision earlier this month by Merck, Bristol-Myers Squibb, and the US Chamber of Commerce, all of whom are represented by PhRMA.
The latest lawsuit argues the plan contingency gives too much authority to HHS.
PhRMA and the two organisations also argue that the provision involves a “crippling” imposition tax aimed at forcing pharmaceutical manufacturers to accept the government-authorised price of medicines, making it a substantial fine forbidden by the Eighth Amendment.
In addition, the lawsuit claims that the strategy violates due process by denying pharmaceutical companies and the general public input on how Medicare negotiations will be carried out.
Stephen Ubl, CEO of PhRMA, said in a statement, “The price setting scheme in the Inflation Reduction Act is bad policy that threatens continued research and development and patients’ access to medicines.”
“It also violates the U.S. Constitution because it includes barriers to transparency and accountability, hands the executive branch unfettered discretion to set the price of medicines in Medicare, and relies on an absurd enforcement mechanism to force compliance,” Ubl added.
As a result, with the agreed values taking effect in 2026, the initial 10 drugs will be chosen in September.
- Published By Team Genuine Reporter