Title: Johnson & Johnson Sues Biden Administration Over Medicare’s Price-slashing Powers
Date: [Insert Date]
Johnson & Johnson has become the latest pharmaceutical company to sue the Biden administration over Medicare’s newfound ability to reduce drug prices. The lawsuit, filed in federal district court in New Jersey, alleges that the Medicare negotiations violate the First and Fifth Amendments of the U.S. Constitution. Johnson & Johnson is now the third pharmaceutical company to challenge this controversial provision of the Inflation Reduction Act.
Merck and Bristol Myers Squibb, along with the U.S. Chamber of Commerce and PhRMA, previously brought separate suits making similar arguments against the Medicare negotiations. The pharmaceutical industry’s largest lobbying group has been actively fighting against this policy.
Johnson & Johnson’s complaint seeks a court order to block the U.S. Health and Human Services Department from forcing the company to participate in the program. The company claims that the Medicare negotiations constitute “innovation-damaging congressional overreach” that threatens the United States’ leadership in developing transformative therapies and patients’ access to those treatments.
President Joe Biden’s Inflation Reduction Act, which narrowly passed in 2022, grants Medicare the power to negotiate drug prices for the first time in the program’s history spanning six decades. The policy aims to make medications more affordable for older Americans but is expected to reduce pharmaceutical industry profits.
The Health and Human Services Department has not yet responded to CNBC’s request for comment regarding the lawsuit.
Johnson & Johnson specifically brings attention to its drug Xarelto, which treats blood clots and reduces the risk of stroke. The company states that Xarelto will be subject to Medicare price negotiations in 2023. Johnson & Johnson argues that these negotiations would essentially force them to provide access to Xarelto on terms set by the federal government, terms the company claims it would never agree to voluntarily. Xarelto generated revenue of $2.47 billion for the company last year.
This story is still developing, and further updates will be provided as they become available.