Federal judge blocks HHS rule requiring list prices in drug TV ads

Drug prices
A federal judge sided with drugmakers Monday, blocking a Trump administration rule to require list prices be included in their TV ads. (Getty/Tero Vesalainen)

A federal judge sided with drugmakers Monday, blocking a Trump administration rule to require list prices be included in their TV ads.

The Centers for Medicare & Medicaid Services (CMS) announced the rule in May that would require drug manufacturers that sell drugs covered by Medicare and Medicaid to include the cost for a typical course of treatment, such as a 30-day supply of medication for a chronic condition, in their TV ads.

Merck & Co., Eli Lilly and Amgen, along with the Association of National Advertisers, sued the Department of Health and Human Services (HHS) and CMS to block the rule they call unnecessary and unlawful. The rule was set to take effect July 9.

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In his decision, U.S. District Judge Amit Mehta for the U.S. District Court for the District of Columbia said the HHS rule would exceed the agency’s statutory authority, even as he clarified he was not opining on HHS' motives for adopting the rule. 
"That policy very well could be an effective tool in halting the rising cost of prescription drugs," Mehta wrote. "But no matter how vexing the problem of spiraling drug costs may be, HHS cannot do more than what Congress has authorized."
He also said the policy "is far afield of any other type of rulemaking authority HHS has previously exercised" under the Social Security Act and that it would have far broader policy implications.

HHS spokeswoman Caitlin Oakley said the agency is "disappointed" with the court's decision and will work with the Department of Justice on next steps related to the litigation.

"President Trump and Secretary Azar remain focused on lowering drug prices and empowering patients through more transparency in healthcare costs," Oakley said. "Although 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, and as seen from the President’s executive order, we are working on many different avenues for delivering transparency."

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