News and Reports | August 18, 2026
Patient Advocates Applaud Another Major Legal Victory Protecting Medicare’s Power to Negotiate Lower Drug Prices
WASHINGTON, D.C. — The U.S. Court of Appeals for the D.C. Circuit today rejected Teva Pharmaceuticals’ core statutory and constitutional challenges to the Medicare Drug Price Negotiation Program, delivering another significant legal victory for the historic program that is lowering prescription drug prices for millions of Americans.
The court upheld the Centers for Medicare & Medicaid Services’ (CMS) decision to treat Teva’s Austedo and Austedo XR as a single drug for purposes of Medicare negotiation, concluding that “the IRA permits CMS to treat Austedo and Austedo XR as one statutory drug.” The court also rejected Teva’s constitutional challenge to the program, holding that “the Negotiation Program does not deprive Teva of a protected property interest.”
“Today’s decision is a major victory for patients and yet another rejection of the pharmaceutical industry’s multi-year effort to dismantle Medicare negotiation,” said Merith Basey, CEO of Patients For Affordable Drugs “The court rejected Teva’s core arguments and upheld Medicare’s ability to negotiate a lower price for these drugs. Today’s ruling helps protect the hard-won progress patients across the country fought for in the face of an industry determined to preserve its unchecked pricing power.”
The court did send one narrow issue back to the District Court for further consideration: Teva’s challenge to CMS’s requirement that a generic be genuinely marketed before its brand-name counterpart is excluded from negotiation. The D.C. Circuit did not rule on whether CMS’s policy is lawful; it only ruled that the lower court must consider Teva’s challenge.
Teva manufactures Austedo and Austedo XR, drugs used to treat involuntary movements associated with Huntington’s disease and tardive dyskinesia that were selected for the second round of Medicare negotiation.
P4AD filed an amicus brief in the case in March, defending the Negotiation Program and bringing patient voices directly into Teva’s appeal. The brief urged the court to reject Teva’s constitutional arguments and its attempt to prevent CMS from treating Austedo and Austedo XR as a single drug for negotiation — both arguments the D.C. Circuit rejected today.
Today’s ruling also comes just three months after the U.S. Supreme Court on May 18 declined to hear six pharmaceutical industry petitions challenging the Medicare Negotiation Program, leaving intact lower-court decisions rejecting those challenges. Today’s decision adds to an overwhelming growing body of rulings rejecting the pharmaceutical industry’s years-long legal campaign to dismantle Medicare negotiation, even as negotiated prices are already delivering savings for patients.
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Patients For Affordable Drugs is the only national patient advocacy organization focused exclusively on policies that lower prescription drug prices. We empower and mobilize patients by amplifying their experiences with high drug prices to hold those in power to account and fight to shape and achieve system-changing policies that make prescription drugs affordable for all people in the United States. P4AD does not accept funding from organizations that profit from the development and distribution of drugs. To learn more, visit PatientsForAffordableDrugs.org