The U.S. Chamber of Commerce is suing the federal government over a law that allows Medicare to negotiate drug prices with pharmaceutical companies. The case was filed in Dayton, Ohio. The Chamber of Commerce claimed the law violates pharmaceutical companies’ due process rights by giving the government the ability to dictate price maximums.
The chamber also raised the concern that the law essentially creates an ultimatum for pharmaceutical companies, forcing them to agree to certain prices to stay in business.
Merck & Co. filed a similar lawsuit in Washington, D.C., shortly before the chamber’s lawsuit. The two lawsuits also noted that drug companies would have to pull back on new drug development if price maximums are introduced.
The program is a part of the Inflation Reduction Act of 2022 and includes a plan to negotiate the prices of 10 costly drugs chosen by the Centers for Medicare & Medicaid Services (CMS). The adjusted prices would be rolled out in 2026.
Representatives from both CMS and the White House stated they will continue to defend the program and are confident they will win the cases.
Source: Reuters, June 9, 2023.
