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Drug business commerce teams are suing Trump administrator over drug pricing rule

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© Reuters. US President Donald Trump attends a Thanksgiving video conference with members of the armed forces

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By Carl O & # 39; Donnell and Michael Erman

WASHINGTON (Reuters) – Drug industry trading groups filed two lawsuits against the Trump administration on Friday contesting new U.S. regulations to lower drug prices, which may undermine one of President Donald Trump's primary efforts to cover high drug costs.

The lawsuits were brought in federal courts in Maryland and California by PhRMA, the pharmaceutical industry trade group, and a group of biotechnology trade organizations, including the Biotechnology Innovation Organization (BIO).

The government announced last month that it had passed a ruling that will go into effect Jan. 1 that will reduce payments for some drugs made by Medicare, a US government insurance program, at the lowest price paid by certain other countries should bind.

Since losing the presidential election, Trump has issued and finalized a number of rule changes in areas such as energy, healthcare and immigration to strengthen key areas of his agenda before leaving the White House in January.

The new reimbursement rules affect 50 drugs and are tied to the lowest price calculated from a list of rich countries. The government says the move could save taxpayers and patients $ 85 billion over seven years.

Pharmaceutical Research and Manufacturers of America's lawsuit claims the rule change is illegal because it relies on laws that allow the government to test new drug pricing models but is too far-reaching to qualify as a pilot. It tells the court to stop the rule before it can be implemented.

"It's not a test if it affects the whole country and implies 90% of the spending on (Medicare & # 39; s Hospital Drug) without a control group," said Steve Ubl, PhRMA's chief executive officer.

PhRMA is supported by the Association of Community Cancer Centers, a network of cancer treatment providers.

Lower drug reimbursements could put some cancer treatment centers out of business, especially those heavily reliant on Medicare, said Christian Downs, executive director of the ACCC.

In both lawsuits, it is alleged, among other things, that the administration failed to follow the relevant process by not soliciting stakeholder feedback prior to announcing the new rule.

The White House did not immediately respond to requests for comment.

Government efforts to contain drug prices, such as a proposed rule to force drug manufacturers to display list prices in advertisements, have been undermined in the past by successful industry lawsuits.

STAT News first reported on BIO's lawsuit.

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