Whether the Medicare Drug Price Negotiation Program's mandatory price negotiations and severe financial penalties for non-compliance constitute an unconstitutional taking or compelled speech in violation of the Fifth and First Amendments

No question identified. : 1. This case concerns the “Medicare Drug Price Negotiation Program” (“Program”), which Congress established in 2022. Under the Program, the Centers for Medicare and Medicaid Services (“CMS”) selects prescription drugs that account for the largest share of Medicare spending, “negotiates” with manufacturers to establish a “maximum fair price” for each selected drug, and requires manufacturers to provide Medicare beneficiaries “access” to the selected drugs at those prices. See 42 U.S.C. §§ 1320f-1320f-6. While designed to look like an arms-length negotiation, the Program actually involves forced transfers on terms dictated by CMS. Ifa manufacturer does not sign an agreement to “negotiate” with CMS, or fails to agree to CMS8’s price after those negotiations, the noncompliant manufacturer must pay a 1900% excise tax on all domestic sales of the selected drug or withdraw all its drugs (not just the selected drug) from Medicare and Medicaid. See id. § 1320f-6; 26 U.S.C. §5000D. In other words, the Program makes manufacturers “offer[s] they [can’t] refuse” by threatening them with penalties if they do not “agree” to turn over their drugs at highly discounted prices set by CMS. App. 78a, 81a—82a (Hardiman, J., dissenting) (cleaned up). 2. For the first year of the Program, CMS selected Janssen’s Xarelto® (vivoroxaban), which millions of Americans rely upon to prevent blood clots and reduce the risk of stroke. See App. 20a. Had Janssen not participated, it would have faced more than $90 billion in excise tax penalties in the first year alone—more than triple the 2022 adjusted net earnings of Janssen’s parent company, Johnson & Johnson. See JA796.! Had Janssen attempted to avoid the Program by withdrawing its drug portfolio from Medicare and Medicaid, millions of patients would have lost coverage for Xarelto® and 20 other medications, and Janssen would have lost 65% of its gross sales—crippling the company’s ability to continue developing innovative treatments. See JA796-97. Accordingly, Janssen took the only viable step: it complied with the Program’s requirements. See App. 20a. That compliance started by signing (under protest) an agreement drafted by CMS, expressing Janssen’s assent to participate in negotiations with CMS. See 42 U.S.C. § 1820f-2; App. 16a—18a, 20a. Janssen then signed an addendum drafted by CMS (again under protest), attesting that the company had “negotiated” with CMS and expressing “agree[ment]” that the resulting price—a 62% reduction in the market-based price2—was the “maximum fair price” for Xarelto®. See App. 18a, 20a. As a result, Janssen became obligated (under pain of additional monetary penalties) to provide Medicare beneficiaries “access” to Xarelto® on CMS’s terms starting January 1, 2026, and continuing until CMS determines that generic competition has entered the market. See 42 U.S.C. §§ 1320f(b)(1), 1320f-2(b), 1320f-6. 3. Janssen filed a lawsuit alleging that the Program violates the First Amendment by compelling Janssen to express the Government’s disputed messages about drug pricing, effects a per se taking under the Fifth Amendment by forcing Janssen to transfer Xarelto® to Medicare beneficiaries on CMS’s terms, and imposes unconstitutional conditions on participation in Medicare and Medicaid. 1 Joint