PhRMA sues U.S. government over GLOBE drug pricing model

The Pharmaceutical Research and Manufacturers of America (PhRMA) has filed a lawsuit against the U.S. government to block the ‘Global Benchmark for Efficient Drug Pricing’ (GLOBE) model. The policy, established by the Centers for Medicare & Medicaid Services (CMS), is a pilot program designed to manage drug prices in Medicare Part B by using international price benchmarks from 19 OECD countries, including South Korea.

PhRMA argues that the GLOBE model is illegal and exceeds the statutory authority granted to CMS by Congress. The industry group claims the policy functions as a de facto national drug price control mechanism rather than a legitimate pilot program. They contend that the mandatory rebate structure violates the principle of separation of powers and could undermine medical innovation and research and development (R&D) investment.

According to PhRMA, the program will have minimal impact on patients, estimating that only 0.3% of Medicare Part B enrollees would see reduced out-of-pocket costs. Furthermore, the association expressed concerns that using international pricing metrics—which often incorporate Quality-Adjusted Life Year (QALY) assessments—could lead to discriminatory outcomes for patients with disabilities, chronic illnesses, or rare diseases.