Health Care

Several high-stakes legal challenges affecting the healthcare of older adults are making their way through the federal courts—some with a clear trajectory toward the Supreme Court.

Medicare Drug Price Negotiation Program

The Inflation Reduction Act of 2022 (IRA) grants the federal government the authority—for the first time—to negotiate the price of select high-cost prescription drugs covered under Medicare. Pub. L. No. 117-169, § 11001, 136 Stat. 1818, 1833-54 (2022) (codified at 42 U.S.C. § 1320f). This landmark law marks a historic shift from the long-standing “non-interference” clause and aims to lower drug costs for the Medicare program and millions of Medicare beneficiaries who have long struggled to afford medications critical to managing chronic illnesses. The first round of negotiations targeted ten drugs that treat conditions like cancer, diabetes and heart failure, with price reductions between 38% to 79% below current list prices expected to take effect ton 2026, representing  substantial savings for Medicare beneficiaries, the federal government, and taxpayers.

Drug manufacturers and trade associations are pushing back against the law with lawsuits across the country, challenging the law as unconstitutional under the First (freedom of speech), Fifth (Takings Clause), and Eighth (excessive penalty) Amendments as well as under the Administrative Procedure Act (APA). E.g., Complaint, Dayton Area Chamber of Com. v. Becerra, 2024 WL 3741510 (S.D. Ohio Aug. 8, 2024). To date, all federal district courts considering the merits of these claims have upheld the constitutionality of the IRA.

On May 8, 2025, the Third Circuit issued the first appellate decision upholding the Medicare Drug Price Negotiation Program, finding that drug manufacturers did not have a constitutional right to sell medications to Medicare at unregulated prices. See AstraZeneca Pharms. LP v. Sec’y United States Dep’t of Health & Hum. Servs., 137 F.4th 116, 125-26 (3d Cir. 2025) (“There is no protected property interest in selling goods to Medicare beneficiaries … at a price higher than what the government is willing to pay.”). AARP, AARP Foundation, and others filed amicus briefs underscoring the program’s importance to older adults’ health and Medicare’s long-term financial stability. Brief for AARP et al. as Amici Curiae Supporting Defendants, AstraZeneca Pharms. LP v. Sec’y United States Dep’t of Health & Hum. Servs., 137 F.4th 116 (3d Cir. 2025); Brief for AARP et al. as Amici Curiae Supporting Defendants, Bristol Myers Squibb v. Kennedy, No. 24-1820 (3d Cir. Sep. 16, 2024).

The Third Circuit’s decision marks an early victory for the federal government. But with other appeals pending, the issue may ultimately reach the Supreme Court if a circuit split emerges.

Access to Affordable Prescription Drugs

The high cost of prescription drugs continues to impose significant burdens on older adults. Brand-name drug companies increase prices at rates higher than inflation and engage in anti-competitive practices to block generic drugs from entering the market. One such practice is the improper listing of patents in the catalog of “Approved Drug Products with Therapeutic Equivalence Evaluations”—commonly referred to as the “Orange Book” at the Food and Drug Administration (FDA)—to impermissibly extend patent monopolies over prescription drugs.

The Orange Book, which lists drug products approved as safe and effective, is intended to prevent patent infringement disputes by alerting generic drug manufacturers to brand-name drug companies’ existing patents. In 1984, Congress passed the Hatch-Waxman Act to accelerate the introduction of low-cost generic drugs to the market. Under the Act, generic drug manufacturers can apply for approval of any drug that uses the same active ingredient as an FDA-approved brand-name drug through a streamlined process. If the generic drug does not implicate any valid, unexpired patent, the FDA will approve the drug immediately.

To apply for approval of a drug that may infringe on any patent listed in the Orange Book, the generic manufacturer must certify that the patent is invalid or will not be infringed by the generic drug. The patent owner then has 45 days to file a patent infringement suit against the generic manufacturer. If filed timely, the infringement suit automatically stays FDA approval of the generic drug for two and a half years, regardless of whether any patent was actually infringed upon. Because the FDA does not independently evaluate whether patents are properly listed in the Orange Book, this process incentivizes brand-name companies to list every conceivable patent and sue generic applicants for patent infringement to block competition for two and a half years.

The test for which patents must be listed in the Orange Book is a disputed issue that the Supreme Court may soon review. In December 2024, the Federal Circuit considered brand-name drug manufacturer Teva’s claims against generic manufacturer Amneal for infringing on patents related to an asthma inhaler that Teva had listed in the Orange Book. Teva Branded Pharm. Prods. R&D, Inc. v. Amneal Pharms. of New York, LLC, 124 F.4th 898 (Fed. Cir. 2024). The court held that Teva’s patents were improperly listed because it claimed devices related to the inhaler rather than the drug contained in the inhaler. Id. at 922. As the court explained, a patent should only be listed in the Orange Book if it “claims the drug,” meaning the active ingredient in the drug product. Id. at 919. Should this issue reach the Supreme Court, a decision in favor of brand-name drug manufacturers could expand the universe of patents properly listed in the Orange Book, making it easier for pharmaceutical companies to block generic competition through the automatic stay of FDA approval.

In a 2023 policy statement, the Federal Trade Commission (FTC), supported by the FDA, warned brand-name pharmaceutical companies that they could face legal action for improperly listing patents in the Orange Book. The FTC advised it would scrutinize improperly listed patents as unfair methods of competition in violation of Section 5 of the FTC Act, 15 U.S.C. § 45, and as illegal monopolization in violation of Section 2 of the Sherman Act. 15 U.S.C. § 2. According to former FTC Chair Lina M. Khan, “[i]mproper patent listings in the Orange Book illegitimately delay or lock out generic manufacturers from entering the market, depriving Americans of access to lower-cost medicines and drug products.” 

True to its word, the FTC has challenged over three hundred patent listings across twenty-two brand-name products since issuing its policy statement. Many of these listings relate to drugs that treat diabetes and COPD, which are highly prevalent in older adults. In addition to disputing the listings with the FDA, the FTC has issued a series of warning letters to the manufacturers of these products. The most recent letters, sent in May 2025, indicate the FTC’s intent to continue combating improper listings through enforcement. In a warning letter to Teva, the FTC referenced Teva Branded Pharm. Prods. R&D, Inc. and notified the company that it must delist several other patents not challenged in the litigation.

The FTC has also filed amicus briefs in patent disputes between brand-name and generic manufacturers, arguing that improper Orange Book listings cause significant harm to competition that extends beyond the delay directly caused by the automatic stay of FDA approval. Federal Trade Commission’s Brief as Amicus Curiae, Mylan Pharmaceuticals, Inc. v. Sanofi-Aventis U.S. LLC, No. 23-836 (W.D. Pa. Nov. 20, 2023); Federal Trade Commission’s Brief as Amicus Curiae, Jazz Pharms., Inc. v. Avadel CNS Pharms., LLC, No. 21-691-GBW (D. Del. Nov. 10, 2022).

Private antitrust litigation challenging improper Orange Book listings is likewise percolating in several courts. In 2020, the First Circuit considered a class action of drug purchasers’ claims that Sanofi, a brand-name diabetes drug manufacturer, violated Section 2 of the Sherman Act by improperly listing a patent for an insulin injector pen device in the Orange Book in an attempt to monopolize the market for insulin glargine products. In re Lantus Direct Purchaser Litigation, 950 F.3d 1, 6 (1st Cir. 2020). The First Circuit agreed that the complaint adequately alleged that Sanofi had likely improperly listed the patent in violation of the Sherman Act. Id. at 11-14. It held that improper submission of a patent for listing in the Orange Book gives rise to antitrust liability absent proof that “the submission was the result of a reasonable, good faith attempt to comply with the Hatch-Waxman scheme.” Id. at 14. Cases raising similar antitrust claims are being litigated in district courts in the First, Second, and Third Circuits. E.g., In re Actos Antitrust Litig., 2025 WL 1001259 (S.D.N.Y. Mar. 31, 2025); Iron Workers Dist. Council of New England Health & Welfare Fund v. Teva Pharm. Indus. Ltd., 734 F. Supp. 3d 145 (D. Mass. 2024); Jazz Pharms., Inc. v. Avadel CNS Pharms., LLC, 2024 WL 2700031 (D. Del. May 24, 2024).

Orange Book listing abuse may also implicate questions of administrative law, namely which agency should enforce the listing requirements and the scope of that agency’s enforcement power. So far, the FTC has led enforcement while the FDA has taken on a “ministerial role,” updating the Orange Book without ensuring that every listed patent belongs there. In re Lantus, 950 F.3d at 4. The current administration may take a different approach. And if either agency ramps up enforcement, defendants could begin to raise administrative overreach arguments to block that agency’s enforcement efforts. These kinds of arguments may interest the Supreme Court in light of its recent focus on administrative agency authority.

Combating Health Care Fraud

The False Claims Act (FCA) is one of the most effective tools for combating fraud involving public funds. 31 U.S.C. §§ 3729-3733. Its qui tam provision allows private individuals—called relators—to sue defrauders on the federal government’s behalf. 31 U.S.C.A. § 3730(b). The law protects these whistleblowers from retaliation by their employer. In 2024 alone, over $2.9 billion was recovered through FCA litigation, more than $2.4 billion of that from qui tam cases. Press Release, U.S. Dep’t of Just., False Claims Act Settlements and Judgments Exceed $2.9B in Fiscal Year 2024 (Feb. 6, 2025).

The FCA is especially relevant in the healthcare sector, where providers bill federal programs like Medicaid, Medicare, and Tricare that often deliver affordable healthcare to older adults, many with low income. When providers submit claims to these programs, they certify compliance with applicable laws; failure to comply can trigger FCA liability. United States v. Am. Health Found. Inc., 2023 WL 2743563, at *9-*10 (E.D. Pa. Mar. 31, 2023); Universal Health Servs., Inc. v. United States, 579 U.S. 176, 180-81 (2016). For example, nursing facilities that fail to meet federal quality standards under the Nursing Home Reform Act but continue billing Medicaid or Medicare may face FCA claims. Am. Health Found., Inc., 2023 WL 2743563, at *9-*10; Universal Health Servs., Inc., 579 U.S. at 180-81. In 2024, health-related fraud accounted for over half of all FCA recoveries. U.S. Dep’t of Just., supra.

A recent district court decision threatens the future of qui tam litigation. In United States ex rel. Zafirov v. Fla. Med. Assocs., LLC, Zafirov, a Florida district court held the FCA’s qui tam provisions are unconstitutional under Article II’s Appointments Clause. 751 F. Supp. 3d 1293, 1304 (M.D. Fla. 2024); U.S. Const. art. II, § 2, cl.2. The case, brought by a whistleblower, alleged that the defendants defrauded Medicare by inflating the severity of patients’ medical conditions. Zafirov, 751 F. Supp. 3d at 1303. The court concluded that a relator functions as an “officer of the United States” and must be appointed by the President. Id. at 1304. Because the whistleblower was not, the court found that she was an “improperly appointed officer” and dismissed the case with prejudice. Id. at 1322-23. Both the whistleblower and the Department of Justice have appealed the ruling to the Eleventh Circuit.

The Zafirov decision marks a sharp departure from established precedent. The Fifth, Sixth, Ninth, and Tenth Circuits have all upheld the constitutionality of qui tam provisions. Riley v. St. Luke’s Episcopal Hosp., 252 F.3d 749 (5th Cir. 2001); U.S. ex rel. Taxpayers Against Fraud v. Gen. Elec. Co., 41 F.3d 1032 (6th Cir. 1994); U.S. ex rel. Kelly v. Boeing Co., 9 F.3d 743 (9th Cir. 1993); U.S. ex rel Stone v. Rockwell Int’l Corp., 282 F.3d 787 (10th Cir. 2002). However, the Zafirov decision drew support from Justice Thomas’s dissent in United States ex rel. Polansky v. Exec. Health Res., Inc., 599 U.S. 419 (2023), as well as concurrences by Justices Kavanaugh and Barrett, who raised concerns about private individuals exercising executive enforcement authority. Id. at 442-49.

If the Eleventh Circuit affirms the district court’s ruling, it could trigger a circuit split and prompt Supreme Court review. The stakes are high: gutting qui tam provisions would deprive the government of a cost-effective tool to uncover fraud—particularly in the healthcare sector where wrongdoing is often hidden and could significantly harm older adults.

• Maame Gyamfi, MGyamfi@aarp.org
• Rachel N. Lokken, RLokken@aarp.org
• Dean Graybill, DGraybill@aarp.org

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