Appeals Court Revives PhRMA’s Challenge to IRA’s Medicare Drug Price Negotiation Program

Appeals Court Ruling:
The Fifth Circuit Court of Appeals has revived a lawsuit filed by the Pharmaceutical Research and Manufacturers of America (PhRMA) challenging the pricing provisions in the Inflation Reduction Act (IRA), specifically the Medicare Drug Price Negotiation Program.

Jurisdictional Issue:
The appeals court ruled that the district court has jurisdiction over the case, reversing a previous dismissal by Senior U.S. District Judge David Alan Ezra, who had stated that the National Infusion Center Association (NICA) lacked standing because it does not manufacture or sell drugs affected by the Medicare negotiations.

Legal Challenge:
PhRMA and its co-plaintiffs argue that the IRA's drug price negotiation program is unconstitutional, claiming it violates the separation of powers doctrine, the Fifth Amendment’s due process clause, and the Eighth Amendment’s prohibition on excessive fines.

Impact on Healthcare:
The IRA aims to make healthcare more affordable by allowing Medicare to negotiate prices for certain high-priced drugs and requiring drug manufacturers to pay rebates if their price hikes exceed the inflation rate.

Future Proceedings:
The case will now return to the U.S. District Court for the Western District of Texas for further consideration of the merits of PhRMA's arguments against the IRA.