Bristol Myers Squibb (BMS) has filed a lawsuit against the Biden administration, following in Merck's footsteps, claiming that an upcoming Medicare drug negotiation program violates the First and Fifth Amendments of the U.S. Constitution. The company alleges that if the drug price negotiation program comes into force, it would force pharma companies to give big discounts to Medicare and sell their products below market value. BMS claims that the negotiation provision violates the Fifth Amendment, which requires just compensation whenever private property is taken for public use. BMS is also accusing the Department of Health & Human Services (HHS), of violating the First Amendment by insisting that it publicly position the IRA provision as a negotiation.
BMS is not alone in its legal challenge; Merck was first out of the gate earlier this month targeting the Biden administration’s Inflation Reduction Act (IRA). The IRA aims to save $25 billion in drug costs over eight years by renegotiating prices for some of the most widely prescribed medicines starting from 2026. Both companies claim that this could affect their top-earning drugs.
lawsuit, Bristol Myers Squib