December 3, 2023

Bristol-Myers Squibb On Friday, the Biden administration was sued over Medicare’s new power to slash drug prices, the third such lawsuit filed against the program in as many days.

The suit, filed in federal district court in New Jersey, argues that Medicare negotiations violate the First and Fifth Amendments to the U.S. Constitution.

Bristol Myers Squibb has asked the court to declare the plan unconstitutional and prevent the Department of Health and Human Services from forcing the companies to negotiate.

Bristol Myers Squibb’s arguments mirror those made last week by Merck, the first company to sue the federal government over drug negotiations. The U.S. Chamber of Commerce sued HHS over the program on similar grounds.

The Lower Inflation Act, passed on a narrowly partisan vote in 2022, authorizes Medicare to negotiate drug prices for the first time in the program’s six-decade history. The law is a central pillar of the Biden administration’s efforts to control rising drug prices and is a major victory for Democrats.

Bristol Myers Squibb said its blood thinner Eliquis, used to treat blood clots and strokes, will be in talks this year. The company took in $11.8 billion in revenue from Eliquis last year, about 25% of the company’s total revenue of $46 billion in 2022.

The drugmaker also said Opdivo, used to treat multiple cancers, would be subject to Medicare negotiations in the future. Opdivo generates $8.2 billion in sales for the company in 2022, accounting for about 18% of the drugmaker’s total revenue for the year.

Bristol Myers Squibb argued the federal government was forcing the company to negotiate and eventually agree to a deeply discounted price. The company claims this violates Fifth Amendment protections that prevent the government from seizing private property without just compensation.

The drugmaker also claimed that HHS was forcing the company to reveal the program publicly as part of negotiations for a fair price. The company called the talks a fraud and claimed the federal government was forcing the drugmaker to “repeat its favored political message,” in violation of the First Amendment.

“The law is on our side,” HHS Secretary Xavier Becerra vowed to vigorously defend the Lower Inflation Act in court in a statement after Merck filed the lawsuit last week.

White House press secretary Karin Jean-Pierre also issued a statement after the Merck lawsuit, saying the Biden administration is confident of winning in court.

“There is nothing in the Constitution that prevents Medicare from negotiating lower drug prices,” Jean-Pierre said.