The Biden Administration responded to the Chamber of Commerce’s
lawsuit against the
Inflation Reduction Act’s (IRA’s) Medicare Drug Negotiation Program by filing a motion to dismiss it.
The Chamber’s lawsuit centers on the claims that the drug negotiation provision will confiscate patented products from manufacturers without just compensation or force manufacturers to comply and agree with final negotiated prices.
The Administration states that the Chamber’s claims are meritless, due to the voluntary nature of the negotiation process and the fact that no immediate irreparable harm has taken place. Additionally, the motion observes that manufacturers will not feel the impact of the negotiated prices until at least 2026, and the case could be “fully litigated” by that point.
Meanwhile, the Centers for Medicare & Medicaid Services (CMS) is scheduled to announce the first 10 drugs eligible for negotiation by September 1. After that, the manufacturers of these drugs will have 1 month to sign agreements to participate in the negotiations. Those who do not want to negotiate can withdraw from Medicare and Medicaid or divest their interests in the selected drug. Manufacturers can avoid excise taxes if they provide notice at least 30 days before the tax penalties go into effect.
With 8 business days left before the September 1 announcement of the initial 10 drugs selected for negotiation, the judge has his work cut out for him about whether or not to allow the Medicare Drug Negotiation Program to proceed.
