Monday, 16 December, 2019

Trump's effort to put drug prices in ads now in limbo

Trump's effort to put drug prices in ads now in limbo Trump's effort to put drug prices in ads now in limbo
Deanna Wagner | 10 July, 2019, 19:53

The United States District Court for the District of Columbia has vacated the Trump administration's rule requiring the disclosure of wholesale acquisition costs (WACs) for drugs in direct-to-consumer television advertising. According to the drug makers, the rule used "unprecedentedly broad construction of the agency's statutory authority", violated the First Amendment, and would have created confusion among consumers because most patients will not likely pay list prices for their therapies.

Merck, Eli Lilly and Amgen filed their lawsuit alongside the Association Of National Advertisers trade group on June 14, arguing the rule would confuse consumers by forcing them to disclose a price irrelevant to patients with health insurance.

In a statement released on Monday, Caitlin Oakley, a spokeswoman for HHS, said, in part: "We are disappointed in the court's decision and will be working with the Department of Justice on next steps related to the litigation".

The rule was blocked hours before it was set to take effect, the latest setback for the White House as Trump administration officials continue to search for ways to pressure pharmaceutical companies into lowering their prices - a proposal made by the Trump administration in the runup to last November's midterm election. Specifically, drug manufacturers would have to disclose the list price of a 30-day supply of any drug that is covered through Medicare and Medicaid and costs at least $35 a month. Mehta noed that Congress did not expect HHS to speak with the force of law on this issue. Judge Mehta applied Chevron USA, Inc. v. "But no matter how vexing the problem of spiraling drug costs may be, HHS can not do more than what Congress has authorized", Mehta wrote.

The political implications of both the rule as promulgated and its demise could be interesting in the run-up to next year's presidential election.

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In February, Merck CEO Kenneth Frazier and six other pharmaceutical executives testified in front of the Senate Finance Committee about ways to address rising prescription drug prices. Can he get Congress to go along?

The rule, announced in May, was the first to be implemented from the administration's blueprint to lower drug costs, which was released in 2018.

Judge Amit Mehta sided with the pharmaceutical companies and stated, "HHS can not do more than what Congress has authorized".

Another question could be whether the president wants to give Congress more authority over regulation.

To the extent that these efforts could be viewed as compelling or otherwise burdening protected speech, they may implicate the First Amendment.