July 10, 2019

Federal Judge: Full Stop on Drug Prices in DTC TV Ads

Image of a judge's gavel

This summer, we’ve been following the events in Washington as the July 9 deadline for pricing transparency in DTC TV ads loomed. We’ve watched as industry leaders have weighed in with options – “discontinue TV ads for some brands; challenge the rule in court; not comply and see what happens; or comply and provide context to minimize confusion,” or as some companies like J&J and Lilly got ahead of the deadline and proactively ran ads that included pricing or directed consumers to a website for pricing information.

On July 8, however, U.S. District Court Judge Amit Mehta ruled that the Department of Health and Human Services had overstepped its authority in requiring pricing disclosures.

“To be clear, the court does not question HHS’s motives in adopting the WAC Disclosure Rule. Nor does it take any view on the wisdom of requiring drug companies to disclose prices,” Mehta stated in his 27-page memorandum. “That policy very well could be an effective tool in halting the rising cost of prescription drugs. But no matter how vexing the problem of spiraling drug costs may be, HHS cannot do more than what Congress has authorized.”

As John Bigelow, executive director of the Coalition for Healthcare Communication, noted in an email to members about the ruling, “For now, the industry has won an important battle, helping to avoid what could have been a damaging precedent limiting the First Amendment right to communicate about innovative medicines. The pressure for pricing transparency—true transparency, not the phony transparency offered by the CMS rule—will continue.”

Whether the Trump administration will push back on the ruling remains to be seen, but it’s worth noting that lawmakers from both sides of the aisle support pricing transparency and fair drug pricing in general.

For now, it’s watch-and-wait, so stay tuned.