While the holiday season often brings a lull in action in Washington, D.C. and elsewhere, 2020’s was quite different. On the drug pricing front, a major effort by the Trump administration to cut Medicare prices has been temporarily blocked by a federal judge.
The president’s “most favored nation” clause, which aims to tie drug prices in Medicare to lower prices abroad, has hit an early setback as a federal judge in Maryland ruled the administration didn’t give the public a chance to weigh in, Reuters reports. The new rule was set to start on January 1, but Judge Catherine Blake ruled the executive order was rushed unlawfully, according to the news service.
After Trump moved to implement the measure in November, industry trade groups PhRMA and BIO sued to stop it. Blake’s ruling is temporary and the Trump administration could still win the lawsuit, Reuters points out.
Trump’s “most favored nation” law seeks to lower prices in Medicare by tying the costs of certain medicines to cheaper prices in other developed countries. The pharmaceutical industry strongly opposes the measure and has argued it would bring foreign price controls to the U.S. healthcare system while hurting access.
Aside from Trump’s “favored nation” clause, he’s also pushed to take on drug rebates—an effort the industry favors—and to allow drug imports from Canada. In response, Canada blocked certain exports that could create a shortage there. It isn’t clear how the measures will eventually play out as President-elect Joe Biden is set to be sworn in later this month.
Meanwhile, the pharmaceutical industry isn’t hesitating with its routine price hikes. As of Sunday, the industry had raised prices on nearly 600 medicines by an average of 4.2% so far in January, according to GoodRx. Pfizer, GlaxoSmithKline, Sanofi, AbbVie and Gilead were among companies that raised prices to ring in 2021.