The Inflation Reduction Act made historic inroads into lowering Medicare prescription costs but greedy pharmaceutical companies are trying to safeguard profits and retain the ability to set drug prices as high as they want by suing to block the authority of the Secretary of Health and Human Services to negotiate on behalf of taxpayers.
Boehringer Ingelheim Pharmaceuticals, Inc. (BI) filed a lawsuit against the U.S. Department of Health and Human Services (HHS) and its Secretary Xavier Becerra in 2021, alleging that the federal government’s policy on contract pharmacies is unlawful.
Boehringer Ingelheim, the world’s largest private pharmaceutical company, also argues that the Inflation Reduction Act’s (IRA) Medicare drug negotiation process violates the U.S. Constitution because it gives federal regulators too much power to dictate drug prices.
The Center for American Progress (CAP) and the NAACP jointly filed an amicus curiae brief in the case, emphasizing the benefits of the Medicare prescription drug price negotiation program for affordability and health equity.
“Pharmaceutical companies charge Americans exorbitant prices that no other country is willing to accept—resulting in massive profits for drugmakers while patients are unable to afford needed medications,” said Emily Gee, senior vice president for Inclusive Growth at CAP. “Today, CAP is proud to join with the NAACP to stand up to Big Pharma’s legal attack on Medicare’s new authority to negotiate lower prices for lifesaving drugs such as Jardiance.”
“The Inflation Reduction Act took historic action to narrow health inequities by improving prescription drug affordability for seniors and other Medicare beneficiaries,” said Gee. “As with other lawsuits filed by drugmakers against Medicare price negotiation, the Boehringer challenge threatens millions of Americans’ health and economic security.”
“The law that created Medicare coverage of prescription drugs, signed by Republican President George W. Bush in 2003, explicitly prohibited the government from directly negotiating drug prices,” said Lisa McCormick, a progressive Democrat who opposed the Bush-era restriction. “This was a testament to the corrupt political influence of the pharmaceutical industry that also reveals the GOP’s lack of faith in free market capitalism.”
McCormick ran in 2018 against Senator Bob Menendez, who was a vocal critic of legislation that would have granted Medicare broad authority to directly negotiate drug prices with manufacturers.
While government-negotiated prices will not take effect until 2026, this legislative centerpiece of the Inflation Reduction Act is fair to everyone.
Medicaid has long enjoyed broader drug price negotiation authority. The VA, the largest healthcare system in the US, has also had significant bargaining power with drug companies. Private insurance companies and Pharmacy Benefit Managers, intermediaries between drug makers and pharmacies, have also negotiated discounts and rebates.
Some Boehringer products have caused serious side effects resulting in permanent injury or death. The company was also accused of failure to adequately warn patients and the medical community about potential risks and is facing thousands of lawsuits over the medications Pradaxa and Tradjenta.