MINNEAPOLIS (Legal Newsline) – A federal judge has refused to let a pharmaceuticals trade association go forward with a lawsuit that says Minnesota’s free insulin program is unconstitutional.
Judge David Doty on March 15 granted a motion to dismiss filed by Minnesota Attorney General Keith Ellison’s lawyer and also rejected Pharmaceutical Research and Manufacturers of America’s request to file a supplemental complaint.
There are other compensation remedies available other than a federal lawsuit, Doty wrote. Inverse condemnation actions that are filed when the government takes property without invoking eminent domain powers are available, he wrote.
“PhRMA argues that inverse condemnation actions cannot compensate for ‘future takings’ and continuous takings. The court disagrees. First, a ‘future taking’ – or a taking that has not happened yet – does not give rise to a claim under the Takings Clause,” he wrote.
“The government does not need to compensate for property it has not yet taken. Second, the court is not convinced that bringing multiple actions impairs the ability of Minnesota’s inverse condemnation procedures to adequately compensate insulin manufacturers.”
PhRMA argued in a lawsuit filed last year against the Alec Smith Insulin Affordability Act that says it is unconstitutional to take its members’ private property to achieve a public policy goal.
The complaint notes the high out-of-pocket cost of insulin for users who lack health insurance or whose insurers require large payments on their parts.
“Minnesota could have taken various lawful steps to address this concern,” the complaint says.
“What Minnesota chose to do, however, is to order pharmaceutical manufacturers to give insulin to state residents, on the state’s prescribed terms, at no charge to the recipients and without compensating the manufacturers in any way.”
The complaint cites the Takings Clause of the Fifth Amendment, which it says bans Minnesota’s “draconian” law.
Manufacturers are doing their best to make insulin affordable and available, the complaint says. But the new law, which was signed April 15, 2020, goes too far, PhRMA says. Minnesota residents with a family income of 400% or less of the federal property level who are not eligible for or enrolled in other programs are entitled to free insulin.
Individuals with coverage under Medicare Part D can also receive free insulin if they have spent more than $1,000 on prescription drugs in the calendar year. It is up to the manufacturer to investigate whether applicants meet the various criteria.
“The requirement that PhRMA’s members give away their personal property for free constitutes a per se taking of private property,” the complaint says.
Doty says a declaration on his part that the act is an unconstitutional would be the equivalent of an injunction against it – something barred under a case known as Knick.