Pharmaceutical Research and Manufacturers of America v. Walsh: The Supreme Court Allows the States to Proceed with Expanding Access to Drugs

Abstract:     
While Congress continues to debate prescription drug coverage for Medicare beneficiaries, the states have been moving forward with making drugs more affordable to their residents. Several of these programs use the states' Medicaid market power to force drug manufacturers to provide discounts. In Pharmaceutical Research and Manufacturers of America v. Walsh, the Supreme Court rejected a pharmaceutical industry challenge to such a program, upholding the Maine Act to Establish Fair Pricing for Prescription Drugs. The divided Court decisively rejected a Commerce Clause challenge to the program, and held that nothing in the Medicaid statute itself restricts the states from using Medicaid purchasing power to expand drug coverage for their poor residents. Several Justices noted that Medicaid is a cooperative federal-state program, and that the federal Department of Health and Human Services might well have a say in how much flexibility the states ultimately have in using the Medicaid program to this end. Nevertheless, the case represents an important victory for the states in their efforts to make drugs more affordable for their residents.

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