Supreme Court justices seemed to lean toward pharma's position in arguments over a California county's right to sue drugmakers to get promised discounts. Santa Clara County maintains it should be able to ask the courts to enforce federally mandated pricing discounts for safety-net healthcare providers, but drugmakers contend that enforcement is the feds' responsibility.
More than 14,000 healthcare facilities participate in the discount program, which requires drugmakers to sell them products at cut-rate prices. The discount agreements are required for any company that sells drugs to Medicaid. Santa Clara County's lawyer said normal contract law should allow third-party facilities--beneficiaries of the pricing deals--to sue.
The Obama administration argued pharma's side, however, saying that the law gave enforcement authority only to the Department of Health and Human Services. Justice Department lawyer Ginger Anders also said the healthcare reform law created new procedures for health providers to complain about overcharging.
During oral arguments, justices suggested that the discount agreements are between drugmakers and the federal government and said that Congress didn't give third parties the right to sue to enforce them. "I have trouble finding that intent here," Justice Antonin Scalia said. A decision should come later this year.
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