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Trump rule requiring drug prices in TV ads blocked

Trump rule requiring drug prices in TV ads blocked

U.S. District Judge Amit Mehta ruled Monday that the U.S. Department of Health and Human Services did not have the statutory authority to adopt the rule. The rule had been slated to take effect today, July 9.

Interestingly, the opinion did not focus on the drugmakers' argument that a disclosure requirement violates the First Amendment right of free commercial speech.

Mehta wrote that in halting the rule, the court was not questioning its wisdom, but resting the issue on the law set by Congress in the first place. Trump has said he is drawing up an executive order that includes a clause that would match the price of drugs in the U.S. to the lowest among a list of 'favoured nations'. Prescription drugs are not purchased in the same manner as laundry detergent or shampoo; "list prices" can be meaningless in light of insurance coverage, coupon programs, and purchasing agreements.

That said, patient advocate groups told NPR that while holding drugmakers accountable for prices is welcome, they remained skeptical that drug companies could be shamed, as the administration intended, into lowering their prices. "But no matter how vexing the problem of spiralling drug costs may be, HHS can not do more than what Congress has authorised". "Americans should be trusted to evaluate drug price information and discuss any concerns with their health care providers".

The lawsuit was brought by three major manufacturers, Merck, Eli Lilly and Amgen.

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The Trump administration suffered a setback with the ruling and it is unclear what steps will be taken next to deliver on his pledges to help lower drug costs.

The Trump Administration's plans to force drug companies to include pricing information in drug ads just failed in a big way. Those that sued after the Trump administration's announcement in May cited First Amendment grounds. HHS said the 10 most commonly advertised drugs have list prices of $488 to $16,938 per month or for a usual course of therapy.

The average price increase was 10.5%, or around five times the background rate of inflation, and suggest Trump's claims to have had an impact on drug pricing since the blueprint was published a year ago have no weight.

Drug companies complained the rule would "confuse" and "intimidate" patients because insurers, including Medicare and Medicaid, negotiate discounts with drug companies, meaning the list price, often much higher, could cause sticker shock. Critics noted, for example, that it would have allowed the industry to police itself, with no other enforcement mechanism.