1:42 PM
Apr 13, 2018
 |  BC Extra  |  Politics & Policy

U.S. appeals court overturns Maryland drug price law

The U.S. Court of Appeals for the Fourth Circuit found a Maryland drug pricing law unconstitutional, overturning a lower court's dismissal of a suit brought against the law by the Association for Accessible Medicines (AAM), which filed suit last year to block the law (see BioCentury Extra, July 6, 2017).

In the majority opinion, Judge Stephanie Thacker wrote that the law violates the dormant commerce clause because it directly regulates the price of transactions that occur outside Maryland, as no wholesale pharmaceutical distributors are located in Maryland.

The law, which went into effect in October 2017, allowed the state's attorney general to sue drug manufacturers, and authorized courts to levy civil penalties, in cases of "price gouging" for an "essential" off-patent or generic drug (see BioCentury Extra, March 21, 2017).

Maryland Governor Larry Hogan allowed the legislation, H.B. 631, to become law without his signature, but questioned the bill's constitutionality and described some language in its text as vague, noting that drug manufacturers would have difficulty discerning whether they are in violation of certain provisions (see BioCentury Extra, May 26, 2017).

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