Klobuchar says courts should uphold law for Medicare drug price negotiations

U.S. Sen. Amy Klobuchar, D-Minn., and fellow Democratic lawmakers argue in a court filing this week that pharmaceutical companies are wrongly trying to accomplish through the courts what they couldn’t win in Congress, as manufacturers keep pursuing litigation to stop the federal Medicare program from negotiating lower drug prices.

Medications that prevent blood clots and help with diabetes are among the first 10 drugs subject to price negotiations between the federal government and drug manufacturers under a law passed in 2022.

Last month, the U.S. Department of Health and Human Services announced projections for the program’s first year in 2026, saying people on Medicare should save $1.5 billion in out-of-pocket costs for these prescription drugs while the federal health insurance program itself can expect $6 billion in savings.

Drug companies — including New Jersey-based Bristol Myers Squibb, whose blood thinning drug Eliquis is subject to negotiations — have argued the program violates the Constitution by forcing them to turn over to the government their most successful medication products at huge discounts. After losing in lower courts, Bristol Myers and two other manufacturers appealed their cases to the Third Circuit, where Klobuchar and 14 other lawmakers filed their amicus brief late Monday.

“The pharmaceutical industry and its allies have tried to prevent this legislative result,” the lawmakers wrote. “Appellants now attempt to accomplish through judicial action what they could not through the legislative process.”

AstraZeneca, a drug manufacturer based in the U.K., said in a statement that its ongoing legal challenge “is necessary to support and improve patients’ access to future life-saving medicines, and our rights as a company. There is a lot at stake here, so we have decided to appeal the court’s decision.”

Bristol Myers and Janssen Pharmaceuticals, which also appealed to the Third Circuit, did not immediately respond to a request for comment.

Klobuchar co-authored legislation to create the Medicare drug price negotiation program, which was passed as part of the Inflation Reduction Act.

“They continue to do everything possible to slow this down, because they want to hold onto the profits and keep charging Americans exponentially more for drugs than in other countries,” Klobuchar said in an interview.

Opponents of Medicare price negotiations have been 0-for-7 in various lower court rulings thus far, Klobuchar said.

Legal scholars at Georgetown University wrote earlier this month about a “pile-up” of industry losses in cases decided this summer, although appeals are underway in the Third and Fifth circuits.

“Of all the lawsuits that have been filed, and all the courts that have issued decisions, the industry hasn’t won any of them,” said Andrew Twinamatsiko, director of the Health Policy and the Law Initiative at Georgetown’s O’Neill Institute. “The courts have rebuffed the challenges that have been proffered by the pharmaceutical industry and their allies.”

Manufacturers face a difficult decision if one of their drugs is selected by the government for negotiations, Twinamatsiko said, since refusing to bargain means a company can’t sell the selected drug to Medicare without facing significant penalties. Even so, court rulings so far have stressed the voluntary nature of the program, he said.

“What the courts have found is: You are voluntarily selling these drugs to Medicare. … As long as you chose to sell to Medicare, Medicare is free to say: ‘OK, if you want to sell me your drugs, this is the money I’m willing to pay,’” Twinamatsiko said. “The Constitution doesn’t force Medicare to pay you the price that you’ve dictated as a drug manufacturer.”

Successful defense of the law thus far has been heartening to supporters like Dawn Tuveson, who has been taking Eliquis since a heart attack in March 2023. Tuveson, 70, of Woodbury said her out-of-pocket costs for the medication more than doubled last year, making it unaffordable and pushing her to fill the prescription outside the U.S.

“No American or no Minnesotan should have to rely on an international pharmacy to access our medications,” she said during a Klobuchar news conference last month in St. Paul.

Medicare drug price negotiations have emerged as an issue seniors are watching as they consider ways to save money at the pharmacy counter. The Inflation Reduction Act included other measures to help control spending on drugs, including a $2,000 cap on out-of-pocket spending that begins next year for seniors with Medicare Part D coverage.

AARP estimates that 3 million to 4 million Part D plan enrollees nationwide — including about 40,050 people in Minnesota — should benefit from the new cap every year between 2025 and 2029. The law limited insulin costs, Klobuchar said, and eliminated out-of-pocket costs for recommended preventive vaccines.

The federal government estimates that more than 27,000 Medicare enrollees in Minnesota who use insulin could have an average savings of $672 per year. The vaccine benefit is available, the government says, to more than 900,000 state residents enrolled in Medicare Part D.