By Jake Johnson
Merck on Tuesday became the first pharmaceutical company to sue the Biden administration over a recently enacted law that empowers Medicare to directly negotiate the prices of a small number of high-cost prescription medicines with drugmakers — a change that could threaten Merck’s bottom line.
Filed in a federal court in Washington, D.C., Merck’s lawsuit characterizes the drug price negotiation policy established by the Inflation Reduction Act as “tantamount to extortion” and claims the “singular purpose of this scheme is for Medicare to obtain prescription drugs without paying fair market value.”
The lawsuit against the U.S. Department of Health and Human Services and the Centers for Medicare and Medicaid Services also alleges that the drug price negotiations make “a mockery of the First Amendment” by “conscripting companies to legitimize government extortion.”
The suit asks the court to “declare that the program effects compensable takings under the Fifth Amendment, and enjoin its compelled ‘agreements’ under the First Amendment.”