The Biden administration’s program enabling Medicare to negotiate lower prices for prescription drugs faced a constitutional challenge in a 2-1 decision by a federal appeals court in New Orleans. The program, created as part of the Inflation Reduction Act passed in 2022, targets the negotiation of prices for widely used prescription drugs. The court’s ruling does not dismantle the program but instead sends the case back to a Texas-based federal district court for further consideration. This decision is likely to bring the case back before the conservative-dominated appeals court, where opponents of President Biden’s initiatives often challenge various issues.
The lawsuit challenging the Medicare pricing authority was led by the National Infusion Center Association, representing organizations like the Pharmaceutical Research and Manufacturers of America (PhRMA) and the Global Colon Cancer Association. Their argument revolves around the assertion that Congress lacked the constitutional authority to delegate Medicare pricing authority to an executive branch department. The dissenting opinion by Judge Irma Ramirez, nominated by President Biden, argued that the lawsuit was properly dismissed and that the Medicare Act provides the standing and substantive basis for the claims brought by the National Infusion Center Association.
The Department of Health and Human Services, which oversees programs like Medicare, declined to comment on the court’s decision. PhRMA, on the other hand, released a statement in support of the ruling and expressed satisfaction that their lawsuit challenging the drug pricing provisions of the Inflation Reduction Act would be heard. Conversely, the advocacy group AARP criticized the lawsuit, warning that any efforts to halt the drug negotiation program could jeopardize the wellbeing of millions of older adults in the country who struggle to afford necessary medications.
The 5th Circuit Judge Jennifer Walker Elrod, nominated by former President George W. Bush, wrote the majority opinion along with Judge Kyle Duncan, nominated by former President Donald Trump. Their decision to revive the constitutional challenge to the Biden administration’s drug pricing program highlights the ongoing legal battles surrounding key initiatives of the current administration. The case’s return to the federal district court for further consideration indicates that the legal wrangling over Medicare drug pricing is far from over and will likely continue to be a battleground for opposing viewpoints on healthcare policy and government authority.
The ruling by the federal appeals court in New Orleans injects additional uncertainty into the future of the Medicare drug pricing negotiation program. As new drug prices, agreed upon last month, are set to take effect in 2026, the legal challenges surrounding the program could impact the affordability of prescription drugs for millions of Americans. The involvement of major healthcare organizations like PhRMA and advocacy groups like AARP signifies the high stakes involved in the debate over drug pricing and access to medications for vulnerable populations. Ultimately, the fate of the Biden administration’s program to negotiate lower drug prices through Medicare remains in limbo as legal battles continue to unfold in the courts.
