weather icon Clear

Lawsuit challenges Nevada’s new diabetes drug disclosure law

Updated September 2, 2017 - 4:02 pm

CARSON CITY — Two pharmaceutical groups have filed a lawsuit in federal court challenging the constitutionality of a bill passed by the 2017 Nevada Legislature requiring disclosure of the pricing of diabetes drugs.

The complaint says Senate Bill 539 removes trade secret protections for highly sensitive information and improperly infringes on federal authority over patent rules.

The lawsuit was filed Friday in U.S. District Court in Las Vegas by the Pharmaceutical Research and Manufacturers of America and the Biotechnology Innovation Organization.

SB 539 improperly interferes with federal patent law because the disclosure requirements it imposes penalize the exercise of pricing decisions that are fully consistent with the patent rights granted by Congress, the groups said in a press release announcing the lawsuit.

“Federal law encourages manufacturers to invest in research and development by granting innovators protection through patent and trade-secret laws,” the release said.

The lawsuit also alleges the new law violates trade secret protections.

“Every state in the nation protects trade secrets. SB 539, however, strips this protection for the sensitive and competitively critical pricing and cost information for manufacturers of the most essential diabetes drugs.”

The groups said the new law also requires the state to publish company-specific reports of information disclosed on a public website. If that is done, then the trade secret is no longer secret and will lose its value – not only in Nevada but also throughout the nation.

The lawsuit names Gov. Brian Sandoval, who signed the measure into law earlier this year.

Contact Sean Whaley at swhaley@reviewjournal.com or 775-461-3820. Follow @seanw801 on Twitter

Don't miss the big stories. Like us on Facebook.