Business law

Legal Assault on Medicare Drug Price Scheme in US Courts

The drug industry’s multi-pronged legal battle against Medicare’s drug price negotiation program is likely to gain momentum as manufacturers selected for the first round have just one month to sign agreements entering into price talks and submit manufacturer data to the federal government.

On August 29, the Centers for Medicare and Medicaid Services released the long-awaited list of The first 10 drugs Which will have lower government-negotiated prices starting in 2026. Manufacturers of some of these selected drugs – including Merck & Co, Bristol-Myers Squibb CompanyAnd Johnson & Johnson– They challenge the negotiation program in court. The American Pharmaceutical Research and Manufacturers Foundation is asking a judge for an early ruling in its lawsuit.

The U.S. Chamber of Commerce and several state and local businesses requested a federal judge Program pauseA decision in this regard may be issued next September. AstraZeneca Corporationwhich also makes the diabetes and heart failure drug Farxiga required In its legal complaint filed on August 25, the judge immediately ordered the Biden administration to implement the price negotiations.

The list is is expected to pay Additional companies, incl Novo Nordisk A/STo enter the legal battle.

Drug pricing analysts predicted that any decision in favor of the drug industry could threaten the Medicare agency’s ability to meet tight deadlines set in the inflation-reducing law. The Biden administration has committed to defending the negotiating program, which the Congressional Budget Office estimates will save Medicare about $100 billion over a decade.

American Chamber, PhRMA

The first decision in any of these cases is likely to come from Judge Thomas M. Rose of the US District Court for the Southern District of Ohio, who is prosecuting the chamber’s lawsuit. Includes business group members AbbViewhich together with Johnson & Johnson manufactures the cancer drug Imbruvica, is one of the first 10 products for which the government will negotiate lower prices.

The chamber says the negotiations violate the First Amendment, the separation of powers, and the Due Process Clause of the Fifth Amendment. It also says that the IRA’s financial penalty on companies that refuse to comply with negotiations violates the Eighth Amendment’s prohibition on excessive fines. The organization wants Rose to rule on its proposal to pause the program before Oct. 1, by which time the drugmakers must formally enter negotiations with CMS.

Attorneys for the Department of Justice, on behalf of the Department of Health and Human Services and CMS, asked the court to dismiss the suit brought by the Chamber, arguing that the Chamber failed to show any tangible damages they might suffer if the negotiation program were not paused. . The administration, along with several patient groups that filed amicus briefs in the case, say the pause would hurt Medicare’s ability to negotiate lower drug prices on behalf of beneficiaries.

The next filing expected in the Chamber case will be from attorneys for the Department of Health and Human Services, who are scheduled to file by September 8 an answer in support of their motion to deny.

In the U.S. District Court for the Western District of Texas, PhRMA imposes a tax Constitutional challenge against the programme, along with co-plaintiffs the National Infusion Center Association and the World Colon Cancer Society. Their complaint is similar to the Chamber’s complaint, except for the First Amendment claim.

On August 10, the organizations asked the court to issue a decision in the case before presenting it to trial. The Biden administration on Aug. 28 He applied for dismissal The lawsuit, arguing that only one of the three plaintiffs — the National Infusion Center Association — had any ties to Texas, failed to allege that the federal program would cause injury to any of its members.

Attorneys on behalf of the Department of Health and Human Services are expected to file by September 29 their own motion for summary judgment and opposition to PhRMA’s motion for early judgment. PhRMA and HHS are then expected to make additional filings on October 26 and November 17, respectively.

Merck

The New Jersey-based drugmaker was the first to bring it on board Legal challenge Against the IRA’s Price Negotiation Program, it filed its complaint June 6 in the U.S. District Court for the District of Columbia.

Merck, which is also seeking early judgment In her case, she argues, the negotiation plans violate Fifth Amendment protections against government appropriation of private property without just compensation. The manufacturer, which makes the diabetes drug Januvia, also cited alleged violations of the First Amendment. This argument centers around the claim that by getting drug companies to negotiate lower prices, CMS forces them to say that negotiations are a fair process.

Attorneys for the Biden administration are expected to make their comments in the Merck case by 9/11. Attorneys for Merck and the Department of Health and Human Services are expected to file additional filings by October 19 and November 21, respectively.

Bristol, J & J

The legal complaints from Bristol and Johnson & Johnson, which present overlapping constitutional claims, have compiled brief briefing tables for the cases in the US District Court for the District of New Jersey. Each company submitted its application on August 16 movements For summary judgment, ask Judge Zahid N. Qureshi declared the drug price negotiation program unconstitutional.

Bristol, with PfizerIt manufactures the blood thinner Eliquis, which is the first drug on the list of ten drugs. Eliquis accounted for nearly $16.5 billion in total Medicare spending between June 2022 and May 2023, according to agency data.

J&J’s blood thinner Xarelto and autoimmune treatment Stelara are also on the negotiating list. Johnson & Johnson also manufactures Imbruvica in collaboration with AbbVie.

Justice Department attorneys are due to file a brief brief by October 16 that counters the arguments of Bristol and Johnson & Johnson. The companies have until Nov. 10 to file combined responses to the Biden administration’s dossier, and by Dec. 8 the Department of Health and Human Services will submit a summary to support its proposal for a judge to rule in favor of the government.

Boehringer, AstraZeneca

The latest lawsuits against the negotiation program came from Boehringer Ingelheim Pharmaceuticals Company and AstraZeneca, both of which have made constitutional claims against the IRA itself, as well as alleging procedural violations in Medicare’s enforcement of negotiating provisions.

boehringer, which along with Eli Lilly and Company Manufacture of Jardiance drug for diabetes. His lawsuit was filed August 18 in the US District Court for the District of Connecticut. The German-based manufacturer says its price negotiation plans violate the First, Fifth and Eighth Amendments. It also alleges that the Medicare agency violated the Administrative Procedure Code by directing how negotiations should be carried out rather than creating binding rules.

In its August 25 legal complaint, AstraZeneca cited the Fifth Amendment’s buyout clause, and also argued that Medicare went beyond the law’s definition of negotiable-eligible drugs, as well as “genuine marketing” of generics that would exempt the brand. Product name of the negotiations.

Department of Justice attorneys on behalf of the Department of Health and Human Services have not formally evaluated these cases, and the judges have not ordered briefing timelines.

The star

Unlike other individual drug companies that have lawsuits, Estelas Pharma Company It was not one of the manufacturers that appeared in the list of the first 10 drugs under negotiation. Astellas, which filed its lawsuit July 14 in the US District Court for the Northern District of Illinois, had anticipated in its complaint that Xtandi’s cancer treatment would be subject to the first year of a negotiation program.

The drug manufacturer cites the First and Fifth Amendments in her lawsuit. Attorneys for Astellas and the Department of Justice on August 25 filed a joint motion with Judge Elaine E. Bucklow to release a briefing schedule for the case. The proposed filing schedule would run the case through at least January 2024.


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