Supreme Court rejects appeals from drug manufacturers over Medicare price negotiations

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WASHINGTON (AP) — The Supreme Court on Monday rejected appeals from pharmaceutical companies that object to negotiating Medicare drug prices with the federal government.

The justices did not comment in leaving in place rulings from the federal appeals court in Philadelphia that dismissed the drug manufacturers' claims.

The negotiation program was created as part of the 2022 Inflation Reduction Act, which capped years of debate over whether the federal government should be allowed to haggle directly with pharmaceutical companies over the prices of drugs in Medicare.

The law required the government to negotiate prices for certain high-cost drugs in the federal insurance program for older adults on an annual basis, with the first deals going into effect in 2026.

Not a single Republican voted for the legislation, which was signed by Democratic President Joe Biden. Republicans have been harshly critical of aspects of the law, and Republican President Donald Trump has rolled back programs favoring alternative energy sources.

But the administration has embraced the authority to bring drugmakers to the negotiating table.

So far, the government has negotiated prices for 25 prescription drugs covered by Medicare, including the massively popular GLP-1 weight-loss and diabetes drugs, Ozempic, Rybelsus and Wegovy. In January, the Trump administration announced drugs targeted for a third round of the program, which would bring the total number of drugs with lower prices for Medicare enrollees to 40.

Pharmaceutical companies have forcefully pushed back on the program, arguing policymakers wanting to lower costs should instead rein in insurers and third-party pharmacy benefit managers.

But in the absence of court intervention, stopping the program may require an act of Congress. The statute creating the program doesn’t specify an end date.

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Swenson reported from New York.