December 3, 2023

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Johnson & Johnson On Tuesday, the company sued the Biden administration over Medicare’s new power to slash drug prices, making it the third drug company to challenge a controversial provision of the Reducing Inflation Act.

The lawsuit, filed in federal district court in New Jersey, said the Medicare negotiations violated the First and Fifth Amendments to the U.S. Constitution. Similar arguments have been made in previous separate lawsuits by Merck & Co and Bristol-Myers Squibb, as well as by the U.S. Chamber of Commerce and the pharmaceutical industry’s largest lobbying group, PhRMA.

J&J said its lawsuit was aimed at preventing “overreach by Congress that undermines innovation and that threatens America’s primacy in developing transformative treatments and patients’ access to them.”

The policy aims to make medicines more affordable for older Americans, but could reduce profits for the pharmaceutical industry.

The Department of Health and Human Services, which is named as a defendant in the lawsuit, did not immediately respond to CNBC’s request for comment.

The story is developing. Please check for updates.