Federal judge tosses PhRMA lawsuit challenging Medicare drug negotiations

A Texas federal judge on Monday dismissed a lawsuit challenging the Biden administration’s Medicare drug price negotiations filed by the pharmaceutical industry lobbying group Pharmaceutical Research and Manufacturers of America (PhRMA). 

The decision marks a small victory for the Biden administration, as it’s the first time a court has outright dismissed a challenge to Medicare’s new price negotiation powers.  

There are eight other lawsuits filed by drug companies and other plaintiffs, and the legal fight could stretch for years. The federal government sent out its initial offer to drug companies earlier this month, and while the negotiations will end in August, the prices won’t take effect until 2026.

Judge David Alan Ezra in the Western District of Texas granted the Biden administration’s request to dismiss the lawsuit, ruling that the plaintiffs lacked standing. 

PhRMA was joined in the lawsuit by the National Infusion Center Association (NICA) and the Global Colon Cancer Association, but Ezra dismissed the NICA from the case because he said the court lacked jurisdiction.  

As the NICA was the only plaintiff that resided in Texas, the entire case was dismissed. However, it was dismissed without prejudice and could be brought up again.  

“We are disappointed with the court’s decision, which does not address the merits of our lawsuit, and we are weighing our next legal steps,” PhRMA spokesperson Nicole Longo said in a statement to The Hill.

PhRMA represents some of the largest drug companies in the world. The group sued the administration in June, arguing Medicare negotiation is unconstitutional and violated drug companies’ due process.