For trade group the Pharmaceutical Research and Manufacturers of America (PhRMA), the fight against pricing provisions in the Inflation Reduction Act isn’t over yet.
Late last week, the U.S. Court of Appeals for the Fifth Circuit reversed (PDF) a previous dismissal of PhRMA’s Inflation Reduction Act (IRA) lawsuit from February, punting the complaint back to a lower Texas court.
After filing its lawsuit alongside the Global Colon Cancer Association and the National Infusion Center Association (NICA) last June, the District Court earlier this year slapped down PhRMA’s complaint over procedural problems.
Judge David Ezra specifically dismissed Austin, Texas-based NICA from the case and, because that organization was the lawsuit’s lone plaintiff based in Texas, argued that the venue was improper and dismissed the complaint entirely.
The case was dismissed without prejudice, giving PhRMA the ability to challenge the decision. The trade group did just that in March when it took its argument to the Fifth Circuit.
Now, the appeals court has taken NICA’s side, agreeing that the IRA’s price-setting provisions threaten financial harm and procedural injury by robbing the organization’s members the procedural right to protect their interests.
It is now up to the District Court for the Western District of Texas to once again reconsider the merits of PhRMA and its allies’ complaints against IRA's pricing provisions.
Like drug giants that have taken the IRA to task, PhRMA has argued in its lawsuit that the government pricing negotiations violate due process provisions under the Fifth Amendment. The trade group has also argued that the law’s steep fines for companies that fail to comply violate the Eighth Amendment.
Despite a bevy of legal challenges to IRA from across the pharmaceutical industry, the law’s price-negotiation measures are rolling along.
Back in mid-August, the White House unveiled the negotiated prices for the first 10 prescription drugs affected under the law.
List prices for all but one of the 10 medicines were cut by at least 50%. Diabetes products were hit the hardest, with Merck’s Januvia and Novo Nordisk’s Fiasp suffering 79% and 76% price cuts, respectively.
Apart from PhRMA’s legal challenge, lawsuits from a suite of big drugmakers opposing the IRA have been summarily shot down.
Most recently, it was Novo Nordisk that suffered defeat at the hands of New Jersey District Judge Zahid Quraishi, who previously rebuffed complaints from Johnson & Johnson and Bristol Myers Squibb as well.
Companies like Boehringer Ingelheim and AstraZeneca have also seen their cases rebuffed in federal courts in Connecticut and Delaware, respectively.