The Pharma CEOs Accuse Sanders of Singling Them Out for Lawsuits Over Drug Prices

Johnson & Johnson is stating that Sen. Bernie Sanders (I-Vt.) is retaliating against the company and others that sued the Biden administration to stop a program to negotiate how much Medicare pays for high-cost drugs.

The accusation can be found in a letter obtained by Bloomberg Law following a Senate Health, Education, Labor and Pensions (HELP) Committee announcement that it would vote on whether to use subpoenas to force CEOs from J&J and Merck & Co. to testify on US drug prices.

The committee’s actions raise “significant concerns that the hearing is intended as retribution” against companies involved in lawsuits against the Biden administration over the Medicare drug price negotiation program, as stated by Covington & Burling LLP partner Brian Smith in the letter on behalf of J&J.

“Your insistence on the appearance of the CEOs at the hearing—in contrast to the executive that Johnson & Johnson has offered, who is specifically knowledgeable on the topics you have stated are the subject matter of the hearing—unfortunately elevates our concerns that the hearing is being called to punish the companies who have chosen to engage in constitutionally protected litigation,” Smith wrote.

Merck expressed a similar sentiment in its own letter to Sanders.

“We appreciate that many Committee members have expressed their disagreement with our lawsuit, and we respect their good-faith views,” Jennifer Zachary, Merck’s executive vice president and general counsel, wrote. “That said, your public criticisms of the Companies for challenging the IRA and comments regarding hearing witnesses indicate that the invitations to testify have been extended as retaliation for the Companies’ exercise of their constitutional right to seek relief in court.”

“Retaliation may be a way to chill disfavored speech, but it is not a valid basis upon which to hold a constructive hearing,” Zachary said.

The letters mark the latest blowback from the pharmaceutical industry against lawmakers and the Biden administration over the drug pricing efforts. Both letters were dated Jan. 12, before Sanders Thursday announcement of a hearing to consider subpoenas.

Bristol Myers Squibb‘s CEO has already agreed to testify “alongside at least one of the other pharmaceutical CEOs,” the HELP Committee said in a statement.

Ten lawsuits have been filed by drugmakers and interest groups in effort to stop the drug price negotiation program created by the Inflation Reduction Act from going into effect. Astellas Pharma voluntarily dropped its lawsuit, though the others are in the litigation process.

Johnson & Johnson CEO Joaquin Duato and Merck CEO Robert Davis are being asked to testify “about why their companies charge substantially higher prices for medicine in the U.S. compared to other countries,” according to a committee statement released Thursday.

“It is time to hold these pharmaceutical companies accountable for charging the American people the highest prices in the world for the medicine they need,” Sanders said in the statement. “As the HELP Committee considers legislation to lower prescription drug prices, it is critical that these CEOs explain how they determine the price of medicine in the United States.”

The HELP Committee’s ranking Republican, Sen. Bill Cassidy (R-La.), said in a separate statement that Sanders “did not want to devote the time to a bipartisan effort that could result in meaningful legislation.”

“I hope the HELP Committee can return to its longstanding tradition of bipartisan cooperation, rather than focusing on how many CEOs we can drag to the stocks,” Cassidy said. “It’s not surprising these CEOs do not expect to be given a fair shake by this committee. These companies offered to send their executives in charge of the policies in question, which could have led to a more insightful hearing.”