PhRMA files lawsuit challenging California drug pricing law

The US lobby group Pharmaceutical Research and Manufacturers of America (PhRMA) has initiated litigation in the US District Court for the Eastern District of California challenging SB 17, describing it as ‘an unprecedented and unconstitutional California law.’

Senate Bill 17 was signed by California Governor Jerry Brown in October and is set to take effect January 1, 2019. The law requires drug manufacturers to give 60 days notice if prices rise more than 16% over a two-year period.

In its complaint, PhRMA argues that SB 17 attempts to dictate national health care policy related to drug prices in violation of the United States Constitution, singles out drug manufacturers as the sole determinant of drug costs despite the significant role many other entities play in the costs patients pay, and will cause market distortions such as drug stockpiling and reduced competition.