And the Chutzpah Award goes to drugmaker Merck, which on Tuesday sued the Biden administration over Medicare finally being allowed to negotiate drug prices on behalf of millions of beneficiaries.
Merck, which pocketed a record $14.5 billion in profit last year, says the Medicare-negotiation provision of the Inflation Reduction Act is “tantamount to extortion.”
Put another way, the company says allowing market forces to determine a fair price for prescription meds interferes with its ability to extort the highest possible amounts of money from sick people.
Merck is demanding that the Health and Human Services Department be blocked from compelling drugmakers to haggle over Medicare prices.
Take the cancer drug Keytruda for example. Merck booked $21 billion in sales last year, making the drug responsible for roughly a third of the company’s total revenue.
If Medicare had been able to negotiate costs, Merck seems to be suggesting, the company might have made billions of dollars less from patients undergoing a life-or-death struggle with cancer.
And, gosh, who would want that? Except for maybe, I don’t know, millions of people with cancer.
HHS Secretary Xavier Becerra responded to the lawsuit by saying Uncle Sam is ready for a fight.
“We’ll vigorously defend the president’s drug price negotiation law, which is already lowering healthcare costs for seniors and people with disabilities,” he said in a statement.
Merck’s lawsuit paints an apocalyptic picture of what could happen if Medicare fully exercises its market power — which is how other countries with state-run insurance plans keep drug costs down.
Under the Inflation Reduction Act, it says, “the government will requisition Merck’s patented pharmaceutical products and transfer them to Medicare beneficiaries through forced sales.”
“Those forced sales — coerced by the threat of draconian penalties that the government has admitted no manufacturer could ever rationally afford to pay — will deprive Merck of possession and title to its personal property.”
Actually, no.
A requirement that drugmakers negotiate with Medicare, as they do with private insurers, will introduce more transparency to the drug market and help prevent Americans from paying far more for meds than people in other developed countries.
Medicare has long been blocked from negotiating drug prices by Republican lawmakers.
A recent study published in JAMA Health Forum determined that if Medicare had been able to haggle over some of the priciest drugs on the market, it would have “reduced spending by $26.5 billion on these drugs, or 5% of estimated net Medicare drug spending from 2018 to 2020.”
That would have been good for Medicare and good for patients covered by the program.
U.S. drugmakers routinely say they feel patients’ pain and are committed to lowering drug costs.
Merck’s lawsuit shows their true priority.
