A new development has emerged in the legal battle over the Inflation Reduction Act’s (IRA) provisions on prescription drug prices. AARP and AARP Foundation have filed an amicus brief in support of the Justice Department’s position to dismiss the US Chamber of Commerce’s lawsuit challenging the legality of the IRA’s price controls. The Chamber’s lawsuit aims to prevent Medicare from negotiating lower prescription drug prices, citing concerns about violating free enterprise principles enshrined in the Constitution.
In contrast, AARP argues that blocking drug price negotiations would be detrimental to the public interest, reinforcing the issues that the IRA seeks to address. They emphasize that allowing negotiations to proceed would not only benefit patients but also prevent excessive profits in the pharmaceutical industry. The filing underscores the urgency of fair pricing for chronic condition treatments.
The legal battle has seen multiple parties entering the fray, with major drugmakers such as Johnson & Johnson, Merck, Bristol Myers Squibb, and Astellas filing lawsuits, asserting that Medicare’s price negotiations would infringe upon constitutional amendments. PhRMA, the pharmaceutical trade group, has also joined the litigation, contending that the IRA’s excise tax violates the Eighth Amendment’s Excessive Fines Clause.
The Chamber of Commerce argues that the IRA’s price-setting regime is not genuinely negotiable, as the government-imposed price cannot be refused by manufacturers. The Department of Justice has countered by stating that drugmakers do have a choice in setting prices and doing business.
While some provisions of the IRA have already been implemented, including capping insulin costs and requiring rebates for rising drug prices, the negotiation aspect is set to take effect in 2026. The list of drugs eligible for the initial round of negotiations is expected to be released soon.
As legal debates continue, the fate of prescription drug pricing hangs in the balance, with far-reaching implications for patients, the pharmaceutical industry, and the broader healthcare landscape.
