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If you've been waiting to see whether Medicare's drug price negotiation program would survive a court fight, you have your answer for now. On August 26, the U.S. Court of Appeals for the Fifth Circuit rejected a lawsuit from the Pharmaceutical Research and Manufacturers of America and two other groups, upholding the program created under the Inflation Reduction Act.
This follows the Supreme Court's decision in May to decline hearing similar challenges, and losses in other courts for drugmakers including Merck and AstraZeneca. The negotiated prices already in place for covered drugs stay in place.
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Start by checking your own drug list against the official negotiated-price list.
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What the Court Actually Decided
The Fifth Circuit affirmed a lower court's rejection of the industry's argument that Medicare's negotiation program violates constitutional protections. Writing for the court, Judge Leslie Southwick found that drug manufacturers do not have a protected right to sell medicines to Medicare beneficiaries at prices of their own choosing, because participating in Medicare and Medicaid is voluntary in the first place.
We agree with the Second Circuit, which rejected another IRA due process challenge on the grounds that a company suffers no deprivation of its property interests by voluntarily submitting to a price-regulated government program.
Check Whether Your Own Prescriptions Are Affected
Medicare has already negotiated prices for an initial group of high-cost Part D drugs, with a second, larger group of drugs selected for prices that take effect in 2027. Whether any of this actually changes what you pay depends entirely on which drugs you take and which plan you're enrolled in.
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What Changed, and What Didn't
This ruling does not end the legal fight entirely. Other lawsuits are still working through different courts, and drugmakers who lose one round have generally kept appealing. What it does mean is that the program keeps operating on schedule while those cases continue, instead of pausing while the outcome is uncertain.
If a plan or pharmacy tells you a negotiated price no longer applies, that is worth confirming directly with Medicare rather than assuming it's true. What Medicare Actually Pays for Physical Therapy After a Fall is a useful reminder that plan-level answers can be wrong and are worth double-checking against the official program rules.
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Related reading: CMS Proposes Making Medicare Drug Price Negotiation Rules Permanent covers the separate administrative process running alongside this litigation.
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Common questions
Did a court just strike down Medicare's drug price negotiation program?
No, the opposite happened. On August 26, the U.S. Court of Appeals for the Fifth Circuit rejected a lawsuit from the Pharmaceutical Research and Manufacturers of America and other groups, upholding the program. This follows the Supreme Court's decision in May to decline hearing similar challenges, and losses in other courts for drugmakers including Merck and AstraZeneca.
Why did the court rule against the drug industry?
Judge Leslie Southwick, writing for the Fifth Circuit, found that drug manufacturers do not have a protected right to sell medicines to Medicare beneficiaries at prices of their own choosing, because participating in Medicare and Medicaid is voluntary. The court agreed with a similar ruling from the Second Circuit on the same reasoning.
How do I know if my own prescriptions are affected by Medicare's negotiated prices?
Check your medications against the official list at CMS.gov, which shows the drugs selected so far and the years their negotiated prices apply. Then ask your pharmacist directly whether your plan is billing you at the negotiated price, and compare your last two statements for that drug if it's on the list.
Is this the final word on Medicare drug price negotiation lawsuits?
No. Other lawsuits are still working through different courts, and companies that lose one round have generally kept appealing. This ruling means the program keeps operating on schedule while those cases continue, rather than pausing while the outcome is uncertain.
