Appeals Court Strikes Down Maryland’s Drug Price Gouging Law

(From Reuters)

A federal appeals court on Friday declared unconstitutional a 2017 Maryland law that lets the state attorney general sue generic drugmakers who sharply raise prices on medications.

The 4th U.S. Circuit Court of Appeals sided with the main trade group for generic pharmaceutical companies in holding that the law violated the U.S. Constitution by regulating the price of transactions that occur outside of Maryland.

“To be clear, we in no way mean to suggest that Maryland and other states cannot enact legislation meant to secure lower prescription drug prices for their citizens,” U.S. Circuit Judge Stephanie Thacker wrote for the 2-1 majority.

But Thacker wrote that the law violated the Constitution’s bar against states interfering with interstate commerce, by targeting wholesale rather than retail pricing in transactions that occur largely outside of Maryland.

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