Johnson & Johnson has joined the wave of litigation by becoming the fourth major pharmaceutical company to sue the US government regarding drug price negotiations under the Inflation Reduction Act (IRA).
In a lawsuit filed in the US District Court in New Jersey, J&J argued that Medicare’s price negotiations would violate the First and Fifth Amendments of the US Constitution. Merck, Bristol Myers Squibb, and Astellas have previously made the same claim in separate lawsuits.
Merck escalated the pressure by recently seeking a decision in its case without going to trial, in a federal court in Washington, DC The US Chamber of Commerce and industry association PhRMA have also filed lawsuits with similar allegations.
“The government is forcing (J&J) to provide its innovative, patented medicines on pricing terms that by law must be significantly below market prices,” J&J said in a release. “This would upend the current self-sustaining cycle of pharmaceutical innovation that provides patients with access to pioneering treatments.”
Astellas filed its lawsuit last Friday using similar language. The company referred to the drug negotiation program as “price setting,” contending that it violates the “Takings Clause, the Due Process Clause, and the First Amendment.”
According to the current plan outlined in the IRA, price negotiations are set to commence in 2026 for drugs that generate the highest expenses for the government. Astellas, as reported by Moody’s Investors Service, will have two therapies immediately impacted—Xtandi and Myrbetriq—while J&J will face negotiations for Xarelto and the AbbVie-partnered drug Imbruvica.
“When that happens, Astellas’s constitutional rights will be violated,” the company wrote.
Astellas emphasized in its complaint that it will be compelled to sign an agreement by October 1 of this year in order to participate in the program.
J&J stated in its complaint that potential revenue losses from Xarelto resulting from the negotiation program could not be adequately compensated through legal remedies.
Last month, when Merck initially filed the first lawsuit, Christen Linke Young, deputy assistant to the president for health and human affairs, stated in a conference call with reporters that there is “nothing in the Constitution that prevents Medicare from negotiating lower drug prices.”
PhRMA has also joined the legal battle, objecting to the “price-setting” measures of the Inflation Reduction Act.
