Patent Law

Drug-Price Law Overturned

An appeals court has struck down a Washington, D.C., law barring drug companies from charging excessive prices for prescription drugs.

The D.C. law didn’t define excessive pricing. But it said a prima facie case could be established if the whosesale price of a patented drug was more than 30 percent higher than its comparable price in Canada or other high-income countries.

The U.S. Court of Appeals for the Federal Circuit ruled in an opinion (PDF) signed Wednesday that the D.C. law is pre-empted by federal patent law, the Washington Post reports.

The court noted the District’s argument that drug companies use market power to charge excessive prices for patented drugs.

“This may be a worthy undertaking on the part of the District government, but it is contrary to the goals established by Congress in the patent laws,” the panel wrote. The District’s law is “in effect diminishing the reward to patentees in order to provide greater benefit to District drug consumers.”

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