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(Reuters) -The U.S. government’s Medicare health insurance program can begin negotiating prices for some prescription drugs this fall under a new program, a federal judge ruled on Friday, vindicating one of President Joe Biden’s signature initiatives.
The order by U.S. District Judge Michael Newman in Dayton, Ohio, comes in a lawsuit brought against the Biden administration by the U.S. Chamber of Commerce. The nation’s largest business lobbying group had argued the program would give federal regulators too much power to set drug prices and would stifle innovation.
It is the first ruling to come from multiple lawsuits by drug companies and industry groups challenging the program. Newman was appointed to the bench by Republican former President Donald Trump.
The drug price negotiation program is part of the Inflation Reduction Act (IRA), which Biden, a Democrat, signed last year.
Americans pay more for prescription medicines than people in any other country. The program aims to save $25 billion annually by 2031 by requiring drugmakers to negotiate the prices of selected expensive drugs with the U.S. Centers for Medicare and Medicaid Service (CMS), which oversees Medicare.
Medicare mostly serves the millions of Americans aged 65 and older.
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