A federal appeals court in New Orleans has revived a constitutional challenge to the Biden administration's program that allows Medicare to negotiate lower prices for commonly used prescription drugs. The 2-1 decision by the 5th U.S. Circuit Court of Appeals on Friday sends the case back to a Texas-based federal district court for further consideration.
The program, created as part of the Inflation Reduction Act of 2022, targets the negotiation of lower prices for the first 10 drugs announced last year. The new prices, agreed upon last month, are scheduled to go into effect in 2026.
The lead plaintiff in the lawsuit is the National Infusion Center Association, representing the Pharmaceutical Research and Manufacturers of America (PhRMA) and the Global Colon Cancer Association. One of the key arguments presented is that Congress did not have the constitutional authority to delegate Medicare pricing authority to an executive branch department.
While the district court initially dismissed the case in February, the 5th Circuit Court of Appeals ruled that the claim was brought under the Inflation Reduction Act, not the Medicare Act. The dissenting opinion argued that the Medicare Act provides the basis for the claims made by the National Infusion Center Association.
The Department of Health and Human Services declined to comment on the ruling. PhRMA released a statement expressing satisfaction with the decision, emphasizing the importance of hearing the lawsuit challenging the drug pricing provisions of the Inflation Reduction Act.
On the other hand, the advocacy group AARP criticized the lawsuit, warning that any attempts to halt the drug negotiation program could jeopardize the well-being of millions of older adults in the country who struggle to afford essential medications.
