Judge Amit Mehta rejects Trump rule to help rein in drug prices

Clay Curtis
July 10, 2019

The rule was blocked hours before it was set to take effect, the latest setback for the White House as Trump administration officials continue to search for ways to pressure pharmaceutical companies into lowering their prices - a proposal made by the Trump administration in the runup to last November's midterm election.

Mehta also said he wasn't questioning the motives of the Health and Human Services Department, which issued the price disclosure rule.

A US federal judge ruled against a proposal that pharmaceutical companies need to disclose wholesale prices for their products in T.V. advertising, Reuters reported.

A federal judge ruled Monday to block the Trump administration from forcing pharmaceutical companies to list the prices of medication in television advertisements, stating the Department of Health and Human Services lacks the authority from Congress to regulate drug marketing. HHS said the 10 most commonly advertised drugs have list prices of $488 to $16,938 per month or for a usual course of therapy. Trump has said he is drawing up an executive order that includes a clause that would match the price of drugs in the United States to the lowest among a list of 'favoured nations'.

Mehta handed down the ruling yesterday, July 8, in a decision on a case brought by Merck, Eli Lilly, Amgen, and the National Association of Advertisers.

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"We are not surprised by the objections to transparency from certain special interests, putting drug prices in ads is a useful way to put patients in control and lower costs", said HHS spokeswoman Caitlin Oakley.

HHS attempted an "incursion into a brand-new regulatory environment" and to accept the department's arguments for why it could do so "would swing the doors wide open to any regulation, rule, or policy" that might save money unless any such rule was expressly prohibited by Congress.

"Having applied the tools of statutory interpretation here, the court finds that HHS's adoption of the WAC Disclosure Rule exceeds the rulemaking authority that Congress granted the agency under the SSA", Mehta wrote. Critics noted, for example, that it would have allowed the industry to police itself, with no other enforcement mechanism. And, according to Bloomberg, Trump adviser Kellyanne Conway told reporters Tuesday that the administration may continue to fight for the rule in court. "Today's ruling is a step backward in the battle against skyrocketing drug prices", she said in a statement.

The Trump Administration's plans to force drug companies to include pricing information in drug ads just failed in a big way.

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