Legal challenge to Trump Medicare drug policy
The largest lobbying group for the pharmaceutical industry in the United States (PhRMA) has filed a lawsuit against the Trump administration's efforts to link Medicare drug prices to their prices abroad, claiming that this exceeds legal bounds without justification. The lawsuit targets a pricing system known as "First Price" that is applied to hospital drugs in Part B of the program, and calls for the termination of this system, which was redesigned without legislative approval. According to the court, the changes would lead to a reduction in expected government savings from $11.9 billion to around $440 million over seven years, after more than 20 companies, including Pfizer and Eli Lilly, received exemptions. This lawsuit is a continuation of an earlier battle, as the lobbying group successfully blocked a previous attempt to implement a similar pricing system in 2020. It is expected that the final system will only be applied to four companies.
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