Novartis has become the latest drugmaker to sue the US government over the Medicare drug price negotiation element of President Biden’s Inflation Reduction Act (IRA).
The lawsuit, filed in federal court in New Jersey, comes just days after the Centers for Medicare and Medicaid Services (CMS) announced the first ten prescription drugs that will be subject to pricing negotiations by the health programme.
The list includes Novartis’ top-selling heart-failure medicine Entresto (sacubitril/valsartan), which the company says is the only angiotensin receptor-neprilysin inhibitor currently approved by the US Food and Drug Administration (FDA) to treat heart failure, with around 587,000 Medicare patients taking the drug every year.
The company also outlined in a statement that, since Entresto’s 2015 approval for heart failure with reduced ejection fraction (HFrEF), it has carried out additional studies to extend the use of the drug in different heart failure indications and paediatric populations.
“Under the IRA, which discourages the research and development of additional indications for small molecule medicines by implementing price controls nine years after the first FDA approval, we may not have been able to invest in researching and developing Entresto in these additional indications, depriving patients of a meaningful treatment advance,” Novartis said.
The company added that the negotiations were “unconstitutional” because they amounted to a taking of private property and imposed punitive fines on non-compliant manufacturers.
Other drugs selected for negotiation were Bristol Myers Squibb and Pfizer’s Eliquis (apixaban), Amgen’s Enbrel (etanercept), AstraZeneca’s Farxiga (dapagliflozin), Merck & Co’s Januvia (sitagliptin), Eli Lilly and Boehringer Ingelheim’s Jardiance (empagliflozin) and Novo Nordisk’s Novolog/Fiasp (insulin aspart).
Johnson & Johnson’s Stelara (ustekinumab) and Xarelto (rivaroxaban) were also listed, as well as its AbbVie-partnered Imbruvica (ibrutinib).
Collectively, the drugs accounted for more than $45bn in Medicare Part D spending from June 2022 to May 2023, according to the CMS.
After the negotiation period, the new prices will be announced in September 2024 and will be effective at the beginning of 2026.
The plan is facing court challenges from other leading drugmakers and industry groups, including Merck & Co, Bristol Myers Squibb, Johnson & Johnson, Boehringer Ingelheim, AstraZeneca and the Pharmaceutical Research and Manufacturers of America.