On 25 February 2025, Merck (known as MSD outside the US and Canada), published its 2024 Annual Report, which revealed the company’s expectation that Keytruda® (pembrolizumab) will be selected in 2026 for government price setting under the US Inflation Reduction Act 2022 (IRA). According to Merck/MSD, such price setting would become effective on 1 January 2028, with US sales of Keytruda® likely declining after that time.
In June 2023, Merck commenced litigation against the US Government in connection with the IRA, alleging, amongst other things, that the “Drug Price Reduction Program” legislated by the Act is unconstitutional.
Novartis has also sued the US Government in relation to the IRA (in September 2023), arguing that the negotiations are “an unprecedented and unconstitutional attempt to compel the nation’s drug manufacturers to sell their products at prices dramatically below their market value”.