Federal District Court in Texas Rules that Entire ACA is Invalid

As has been widely reported over the past few days, the federal district court for the Northern District of Texas has issued an order declaring that the individual mandate of the Affordable Care Act (ACA, commonly referred to as “Obamacare”) is unconstitutional, that the remaining provisions of the ACA are not severable from the mandate provision, and that the entirety of the ACA (which includes the Biologics Price Competition and Innovation Act (BPCIA) provisions that set out a biosimilar approval pathway) is therefore invalid.

The order grants only a declaratory judgment that the ACA is unconstitutional and invalid; it does not grant an injunction (which means that it does not prevent the ACA from having effect at this time) and does not affect non-parties to the litigation.

At least a few of the states that intervened to the defend the ACA have declared an intent to challenge the ruling (see press releases here, here, and here, and news coverage, e.g. at https://www.nytimes.com/2018/12/14/health/obamacare-unconstitutional-texas-judge.html.)   The case would be appealed to the U.S. Court of Appeals for the Fifth Circuit, and is expected to end up at the Supreme Court.

We will continue to monitor developments in this case to report on any effect it may have on the BPCIA.

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