Drug manufacturers fighting price disclosure

A bid by the Trump administration to shine light on the high costs of prescription drugs prompted legal resistance Friday by three major pharmaceutical companies.

Amgen, Eli Lilly and Merck sued the Department of Health and Human Services in a bid to block new rules requiring that companies disclose the “list price’’ of their drugs in television advertising.

The three drugmakers called the rules “entirely unnecessary, bad for patients, and detrimental to health care,’’ as well as a violation of the companies’ freespeech rights.

The lawsuit claims that the list price required to be disclosed in advertisements is not meaningful because it doesn’t take into account discounts, insurance coverage, deductibles and co-payments that affect what patients actually pay for their drugs.

Direct-to-consumer prescription advertising exploded across the airwaves in the late 1990s and is often blamed by consumer advocates as painting an excessively rosy picture of drugs’ benefits while stoking demand for costly treatments.

The Trump administration last year seized on the ads to battle rising costs of medicine.

Among the individual defendants named is HHS Secretary Alex Azar, the former president of Eli Lilly’s U.S. operations and the architect of the new rules.

The requirement, scheduled to take effect this summer, is needed to force an honest accounting of drug prices that help fuel inflation, Azar said last month when he unveiled the rule.

“Claiming list prices don’t matter is almost the same as claiming there is no problem with high drug costs at all – and I don’t think many American seniors or patients with serious illnesses would say that’s the case,’’ Azar said at the time.

“If the drug companies are embarrassed by their prices or afraid that the prices will scare patients away, they should lower them,” Caitlin Oakley, a spokeswoman for HHS, said Friday in response to the suit.

List prices directly affect a small percentage of consumers, especially those who have no insurance and people whose prescription co-payments are based on a percentage of the cost.

Drug manufacturers contend disclosing high list prices will mislead people who have insurance, which they said will be bad in the long run for healthcare costs.

“The rule is ... likely to cause many patients to overestimate how much they would have to pay for treatment, and indeed to cause many patients to conclude – incorrectly – that it is not worth asking their doctors about the advertised product even though the treatment might save or significantly improve the quality of their lives,’’ according to the lawsuit, filed in U.S. District Court in Washington.