Novartis has filed a lawsuit against the U.S. government’s Inflation Reduction Act (IRA) after its blockbuster heart failure drug Entresto was included on the Centers for Medicare and Medicaid Services (CMS) list of drugs subject to price negotiations in 2026.
In its lawsuit, Novartis argues that the IRA is unconstitutional and violates the First Amendment. The company also claims that the IRA will “imperil” its ability to conduct research to bring innovative drugs to the market.
The IRA was passed by Congress in 2021 as part of a broader effort to address rising prescription drug prices. The law gives the CMS the authority to negotiate the prices of certain high-cost drugs, including Entresto.
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Novartis is not the only drugmaker to challenge the IRA. Several other companies, including AstraZeneca, Boehringer Ingelheim, and Bristol Myers Squibb, have also filed lawsuits against the law.
The outcome of these lawsuits is uncertain. However, they could have a significant impact on the future of drug pricing in the United States.
Here are some of the key arguments made by Novartis in its lawsuit:
- The IRA violates the First Amendment by interfering with Novartis’s commercial speech.
- The IRA is an unconstitutional taking of Novartis’s property without just compensation.
- The IRA is arbitrary and capricious.
- The IRA will harm patients by making it more difficult for them to access Entresto.
It is too early to say how the courts will rule on these arguments. However, the lawsuit is likely to be a major test of the constitutionality of the IRA.