U.S. Supreme Court Leaves Medicare Drug Price Negotiation Program in Place

The U.S. Supreme Court on Monday declined to hear a series of appeals from major pharmaceutical companies challenging a federal program that requires them to negotiate drug prices with Medicare. The justices, without comment, left in place lower court rulings that upheld the program, clearing a significant legal hurdle for the government's effort to lower prescription costs for seniors.

The program was established by the 2022 Inflation Reduction Act, which for the first time empowered Medicare to negotiate prices directly with manufacturers for certain high-cost medications. The law targets drugs that result in high expenditures for Medicare, the federal health insurance program for people 65 and older. Companies including Novo Nordisk, AstraZeneca, Janssen Pharmaceuticals, Bristol Myers Squibb, Novartis, and Boehringer Ingelheim had sued to stop the initiative.

The drugmakers argued the process was not a true negotiation but amounted to unconstitutional government price controls. Their legal claims contended the program violates the Fifth Amendment by taking property without just compensation and the First Amendment by compelling speech. They also argued it improperly delegates...