Merck's Medicare Price Negotiation Challenge Rejected Again

The US Court of Appeals for the Third Circuit has rejected Merck's (MRK) challenge to the Medicare drug price negotiation programme under the Inflation Reduction Act. This is the latest blow to the pharmaceutical industry, which has been fighting the programme in court since its introduction in 2022.

Merck argued that the programme is unconstitutional under the First and Fifth Amendments, but the court ruled against it, stating that companies are free to determine whether they participate in the programme. This decision follows a similar ruling by a federal court in Maryland, which dismissed AstraZeneca's (AZN) lawsuit alleging improper grouping of its drugs for price reduction purposes.

The pharmaceutical industry has suffered a string of courtroom losses since the negotiation rules were introduced, with several major companies having their cases rejected or declined to be heard by the US Supreme Court. Teva did secure a rare partial victory last week when the federal appeals court in Washington sent a previous ruling back to District Court for further review concerning generic drug marketing requirements.

Patients for Affordable Drugs, an advocacy group, welcomed the decision, stating that it is 'a win for patients who fought for this program and are already seeing the lower prices it delivers'. The group's director of media and communications, Emma Sands, noted that the pharma industry has spent three years and millions of dollars fighting the programme, with their arguments failing in court repeatedly.