Chamber Urges High Court to Strike Down Drug Price Controls

Supreme Court to Hear Arguments in Maine Rx Drug Case

Pharmaceutical Research & Manufacturers of America v. Concannon (Amicus brief 2002)

WASHINGTON, D.C. — The United States Chamber of Commerce has urged the Supreme Court to strike down a Maine pharmaceutical pricing law in a case to be argued today — Pharmaceutical Research and Manufacturers of America vs. Concannon et al. The case involves a Maine prescription drug discount program that would require drug makers and wholesalers to accept the Medicaid price for prescription drugs, even for non-Medicaid patients who purchase those drugs.

"Using Medicaid as a coercive tool to fund other prescription drug programs is unconstitutional," said Robin Conrad, senior vice president of the National Chamber Litigation Center. "Maine's prescription drug rebate program violates both the Commerce Clause — by regulating the prices of sales transactions outside its state borders between drug makers and drug wholesalers — and the Supremacy Clause — by interfering with federal Medicaid law."

Under the Maine law, upheld by the U.S. Court of Appeals for the First Circuit, drug manufacturers must pay a rebate every time an uninsured Maine citizen fills a prescription. If upheld by the Supreme Court, this law would force out-of-state consumers to subsidize the Maine legislature's public policy decisions.

"Without Supreme Court action, drug makers will recoup their lost revenues in Maine by charging consumers in other states more for their prescription drugs," said Conrad.

Medicaid drug prices are typically as much as 25 percent lower than retail. Drug companies that do not agree to accept the lower prices would face restrictions that would make their business in Maine nearly untenable.

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.