Merck sues US Government to halt Medicare drug pricing program
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Merck (NYSE:MRK) is suing the US Government over the Inflation Reduction Act, alleging that the legislation's provision that allows for agencies to negotiate lower drug prices for government programs such as Medicare is unconstitutional.
The company filed suit against the US Department of Health and Human Services, US Centers for Medicare and Medicaid Services, and their respective directors on Tuesday, arguing that the drug negotiation program established by the IRA violates the First and Fifth Amendments of the US Constitution.
The company is seeking an injunction and for the IRA's drug negotiation program to be declared unconstitutional, among other remedies, according to the suit.
Merck said in a statement that the Fifth Amendment requires the government to pay "just compensation" for property taken for public use.
"The IRA allows the government to obtain innovations without providing fair value for them. Under the IRA, the government will take Merck’s patented innovations by coercing the company to provide third parties with access at prices the government set," Merck said.
Merck added that the IRA violates the First Amendment by creating "the false impression that innovators like Merck are voluntary participants in its program by coercing them to sign an 'agreement' conveying that the government-set prices are the 'fair' result of a 'negotiation.'"
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