Novo Nordisk Challenges to CMS Single Source Drug Determinations Fall to IRA's Bar Against Judicial Review

"Yesterday, the U.S. Court of Appeals for the Third Circuit nixed the latest challenge filed by a major pharmaceutical company seeking to overturn the Medicare Drug Price Negotiation Program established by the Inflation Reduction Act (IRA). Building off prior cases, the Third Circuit quelched novel statutory challenges to the Centers for Medicare and Medicaid Services' (CMS) definition of a single-source drug raised by Danish pharmaceutical developer Novo Nordisk based on the IRA's bar against judicial review."

"In CMS' first round of drugs selected for IRA price negotiations, the agency included a series of six injectable insulin products sold by Novo Nordisk, including Fiasp- and NovoLog-branded treatments, as a negotiation-eligible drug having a single source. After Novo Nordisk sued the U.S. Department of Health & Human Services (HHS) in the District of New Jersey, the district court granted summary judgment to the government after finding that it lacked subject matter jurisdiction to review CMS' designation"

"On appeal to the Third Circuit, the appellate court noted that the presumption allowing judicial review of agency action can be overcome by a clear statement of Congressional intent to preclude such review. Reviewing the IRA, the Third Circuit found such a statement codified at 42 U.S.C. § 1320f-7(2), which provides that "[t]here shall be no judicial review of... the determination of negotiation eligible drugs... and the determination of qualifying single source drugs.""

The Third Circuit dismissed Novo Nordisk's challenge to CMS' inclusion of six injectable insulin products as a single negotiation-eligible, single-source drug under the Inflation Reduction Act. CMS had selected those products for the IRA price-negotiation program, and Novo Nordisk sued HHS in the District of New Jersey. The district court granted summary judgment to the government after finding a lack of subject matter jurisdiction and rejecting constitutional claims. The Third Circuit found that 42 U.S.C. § 1320f-7(2) contains a clear congressional statement precluding judicial review of negotiation-eligible and qualifying single-source drug determinations.

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