The Supreme Court on Monday declined to disturb lower-court rulings that upheld the federal government’s authority to negotiate certain Medicare prescription-drug prices, rejecting appeals by pharmaceutical companies that had challenged the program’s legality.
The justices did not issue any comments, leaving in place decisions from the federal appeals court in Philadelphia that dismissed the companies’ claims, according to an Associated Press report by Mark Sherman.
The negotiation program traces to the 2022 Inflation Reduction Act, which created a framework under which the government would negotiate prices directly with drug manufacturers for certain high-cost medications covered by Medicare, the federal health insurance program for older adults.
The law required annual negotiations, with the first negotiated deals set to take effect in 2026, and it capped years of debate over whether the federal government could negotiate directly with pharmaceutical companies over Medicare drug pricing.
The Associated Press report said the legislation was signed by Democratic President Joe Biden and that no Republican voted for it, highlighting the program’s partisan origins and long-running resistance from opponents of the approach.
For the Trump administration, the program’s authority has been carried forward in a way that the Associated Press report described as bringing drugmakers to the negotiating table, even as pharmaceutical companies have pressed legal challenges and argued for alternative targets for cost controls.
The report said the government has negotiated prices for 25 prescription drugs covered by Medicare, including GLP-1 medications used for weight loss and diabetes such as Ozempic, Rybelsus and Wegovy.
It also said the administration announced in January that additional drugs would be targeted for a third round of the program, a step expected to increase the number of drugs with lower Medicare prices for enrollees to 40.
Pharmaceutical companies have argued against the negotiations, the report said, contending that policymakers seeking to lower costs should instead rein in insurers and third-party pharmacy benefit managers.
The Associated Press report said that without court intervention, stopping the program may require an act of Congress, adding that the statute does not specify an end date for the negotiation authority.
The Supreme Court’s action preserves the lower-court rulings and keeps the negotiation mechanism in place as the program prepares for its early expansion phase beginning in 2026, the report said.