A judge has ruled that the Medicare agency can proceed with its drug price negotiation program despite ongoing litigation. The US Chamber of Commerce and its affiliates had argued that the program violated the due process clause of the Fifth Amendment. However, the judge determined that they had not demonstrated a strong likelihood of succeeding on their claim. This decision is a victory for the Biden administration, which is facing multiple lawsuits seeking to overturn the program. Drug manufacturers, including AbbVie Inc, Merck & Co, and Bristol-Myers Squibb Co, have filed lawsuits alleging that the program unconstitutionally forces them to lower prices and harms future pharmaceutical development.
The judge’s order allows the Medicare agency to continue implementing the drug price negotiation program while the litigation unfolds. The Biden administration is currently facing several lawsuits from drug manufacturers and industry trade groups seeking to dismantle the program. These lawsuits argue that the program violates the Fifth Amendment’s due process clause and would negatively impact pharmaceutical development. However, the judge determined that the plaintiffs did not demonstrate a strong likelihood of success on their claim, allowing the program to move forward.
The drug price negotiation program is a key component of the Biden administration’s plan to lower prescription drug costs. The Congressional Budget Office estimates that the negotiations could save Medicare around $100 billion over a decade. Drug manufacturers subject to the program’s first round of negotiations must sign agreements by October 1 or face financial penalties. Some of the companies involved in the lawsuits have publicly stated that they will participate in the price talks, citing the hefty excise tax they would face if they don’t comply. AARP has supported the program and applauded the judge’s ruling, emphasizing the potential savings for taxpayers and improved access to affordable medication for patients.