Price Fixing and Antitrust Liability as a Mechanism to Control Drug Prices

Price Fixing and Antitrust Liability as a Mechanism to Control Drug Prices

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The drug price fixing provisions of the Inflation Reduction Act of 2022 impose government price controls on certain innovative medicines. Under the provisions of the bill, drug companies would be virtually mandated to accept the government’s offered sale price on drugs captured within the legislation, otherwise they would be accessed a 95% excise tax on sales. The bill could jeopardize investment in the next generation of breakthrough treatments and delay drug access.

Meanwhile, the City of Baltimore recently suffered a rebuke in the Seventh Circuit for attempting to claim the patenting behavior by AbbVie relative to their blockbuster drug Humira® created an antitrust violation. Writing for the Court, Judge Easterbrook ruled that neither a settlement agreement between AbbVie and a number of generic biologics companies, nor the 132 patents owned covering Humira®, violate the Sherman antitrust Act.

No one likes paying high prices for drugs and therapies, but is price fixing (which itself is an antitrust violation when done by the private sector) and resorting to the Antitrust laws the right approach to maximizing innovative drugs, cures and therapies? This panel will address, among other things, specific provisions within the Inflation Reduction Act of 2022 and the impact drug price fixing would have on future research and development by large biopharma companies, as well as biopharma startups and SMEs. The panel will also discuss other creative attempts to lower drug prices, such as through the use of antitrust theory, and what the Seventh Circuit decision may mean for any attempt by the Federal Trade Commission to expand the scope of antitrust liability for reverse payments under Actavis?

Materials*

Section 1498(A) is Not a Rx to Reduce Drug Prices by Hon. Susan G. Braden & Joshua A. Kresh

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