U.S. pharmaceutical company Bristol Myers Squibb (BMS) on Friday became the latest organization to file a legal challenge against the the Medicare drug price negotiation program established by the Inflation Reduction Act (IRA).
This suit echoes the complaints filed by Merck & Co. and the Chamber of Commerce, alleging the IRA provision that gives Medicare the power to negotiate drug prices is a violation of the First and Fifth Amendments.
“The IRA does this by requiring BMS and other pharmaceutical companies to provide innovative medicines to third parties at prices set by the government, without any requirement that those prices reflect fair market value,” BMS said in a statement.
“The IRA makes manufacturers of innovative medicines state publicly that the government’s price setting is a true negotiation that resulted in a fair price, even if it was not. The First Amendment protects citizens from just this sort of forced speech,” the company added.
BMS blasted the creation of an “unprecedented regime” that allows the Health and Human Services Secretary to “dictates a price at which pharmaceutical companies are compelled to sell.”
Drugmakers are not strictly required to engage with Medicare in negotiating drug prices. Those that do not wish to engage have the option of either facing heavy excise tax penalties or withdrawing all their drugs from Medicare and Medicaid coverage, forfeiting a highly profitable source of income.
Like the previous complaints, BMS is asking that the drug price negotiation provision in the IRA be declared unconstitutional, that the federal government be blocked from “forcing” the company to sign a manufacturer agreement and that any agreements entered under the program be declared null and void.
The Biden administration has so far characterized these suits as typical bluster from the pharmaceutical industry.
“Any time profits of the pharmaceutical industry are challenged, they make claims about it hindering their ability to innovate. Not only are these arguments untrue, but the American people do not buy them,” White House Press Secretary Karine Jean-Pierre said last week when Merck announced its lawsuit.
An HHS spokesperson told The Hill, when responding to news of the Chamber of Commerce’s suit, that the government plans to “vigorously defend the President’s drug price negotiation law.”
