A Connecticut federal judge threw out Boehringer Ingelheim’s case against the Inflation Reduction Act on Wednesday, marking another win for the federal government as the first Medicare negotiations near a close.
Judge Michael Shea ruled against Boehringer’s constitutional arguments, finding that the company’s participation in the price negotiation program is voluntary and does not constitute a taking of property or a violation of speech.
“With all the resources at the federal government’s disposal, private corporations will often have an incentive to participate in federal programs. The Fifth Amendment does not prevent the federal government from placing conditions on participation in those programs,” Shea wrote in an opinion.
Together with Eli Lilly, Boehringer markets Jardiance, a treatment for type 2 diabetes and one of the 10 medicines whose prices are being negotiated.
The decision is the latest in a series of wins for the federal government in similar lawsuits brought by Bristol Myers Squibb, Johnson & Johnson, AstraZeneca and a handful of organizations including industry trade group PhRMA. Decisions have not yet come in for additional cases brought by Novo Nordisk, Novartis and Merck.
Meanwhile, the first round of Medicare negotiations will come to a close at the beginning of next month. The negotiated prices will be announced on Sept. 1 and take effect in 2026.
Shea made clear in the Wednesday opinion that it isn’t too late for companies to drop out of the program if they don’t like the terms.
“A manufacturer seeking to escape the Program can sign the Manufacturer Agreement and agree to a maximum fair price for its Selected Drug by August 1, 2024, and then, before January 30, 2025, give notice of its withdrawal from the Medicare and Medicaid Programs,” Shea wrote. “Such a manufacturer would never have to sell the Selected Drug at the maximum fair price and would face no excise taxes or civil penalties.”
Boehringer Ingelheim was not immediately available for comment on Wednesday.