US drug industry groups sue govt over drug pricing

A couple of drug industry trade groups sued the Trump administration separately in federal courts in Maryland and California, challenging new US rules to lower drug prices.

The plaintiffs were filed by the Pharmaceutical Research and Manufacturers of America (PhRMA), a pharmaceutical industry trade group, and biotechnology industry trade organizations.

The rule being challenged, which will take effect on Jan. 1, would tie payments for some drugs made by Medicare, a US government insurance program, to the lowest price paid by some countries.

According to the administration, the move could save taxpayers and patients $85 billion over seven years.

The PhRMA claims the rule change is illegal because it is too far-reaching to qualify as a pilot.

Steve Ubl, PhRMA’s CEO, said the rules could not be categorized as it impacts the entire country and implicates 90 percent of spending with no control group.

The Association of Community Cancer (ACC), which joined PhRMA in the suit, noted that lower reimbursements for drugs could put cancer treatment centers out of business, as many rely heavily on Medicare.

Both suits claim that the appropriate process in coming up with the rules was not followed, as it failed to collect feedback from stakeholders before its announcement.