Pharmaceutical company Merck has sued the United States government in an attempt to stop Medicare’s drug price negotiations. The suit follows a new rule issued by the Centers for Medicare and Medicaid Services (CMS) that allows the agency to negotiate with drug makers and set prices for drugs administered in doctors’ offices. Merck claims that the rule violates federal law and “impedes Merck’s ability to freely price its products.”
The lawsuit, filed in federal court in Washington, D.C., comes at a time of growing frustration over rising drug prices in the United States. “We believe that the CMS rule exceeds the agency’s legal authority and raises serious concerns under the Constitution’s separation of powers,” said Merck CEO Kenneth Frazier. “We also believe that the rule could lead to reduced access to medicines and decreased innovation in the pharmaceutical industry.”
The CMS has defended the rule, arguing that it will save taxpayers and patients billions of dollars over the next decade. “This is a historic change that will lower costs and improve access for millions of Americans who rely on Medicare for their health care,” said CMS Administrator Chiquita Brooks-LaSure.
Industry experts predict that other drug makers may also challenge the CMS rule in court. The outcome of the case could have significant implications for the pharmaceutical industry and for Medicare beneficiaries who rely on expensive drugs to manage their conditions.