Merck Sues US Government on Medicaid Drug Price Negotiation

Merck Sues US Government Over Medicaid Drug Price Negotiation

Drugmaker Merck & Co filed suit against the US government on 6 June in an attempt to halt its new Medicare drug price negotiation program contained in the Inflation Reduction Act.

Merck claimed that the new program, implemented as part of the Inflation Reduction Act, violates the FIfth and First Amendmnets of the US Constitution and will force pharmaceutical companies to negotiate drug prices at below market rates. “This is not ‘negotiation.’ It is tantamount to extortion,” the company said in the suit.

The Biden administration program aims to save US citizens $25 billion annually by 2023 through price negotiations for drugs paid for by Medicare, the government health plan for citizens aged 65 and over. Currently, US citizens pay more for prescription medication than any other country.

Merck’s lawsuit marks the first attempt by a drugmaker to challenge the price negotiation program. The company has stated that it is willing to litigate the matter to the Supreme Court level if necessary.

The White House decried the lawsuit. “Big Pharma regularly forces Americans to pay many times what they do customers in other countries for the exact same medicines,” spokesperson Karine Jean-Pierre said in a statement. “We are confident we will succeed in the courts. There is nothing in the Constitution that prevents Medicare from negotiating lower drug prices.”

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