The pharmaceutical industry's leading lobby group is suing California to block enforcement of a new law that requires manufacturers to make public disclosures about substantial hikes in the costs of drugs.

The Pharmaceutical Research and Manufacturers of America, represented by Arnold & Porter Kaye Scholer and Downey Brand, sued the state Dec. 8 in the U.S. District Court for the Eastern District of California.

“The new law imposes nationwide restrictions on the list price of pharmaceutical manufacturers' products. It penalizes manufacturers for conduct that occurs exclusively outside California,” according to the complaint. PhRMA wants an injunction stopping enforcement of the law, and a declaration that the law is unconstitutional.

California's law, signed in October, marked the latest move from state agencies to regulate the drug market. Provisions of the law are set to take effect on Jan. 1 2018, and in January 2019. Pharmaceutical companies would be required to give 60 days' notice if prices are raised more than 16 percent in a two-year period. California Gov. Jerry Brown said at the time: “Californians have a right to know why their medication costs are out of control, especially when pharmaceutical profits are soaring.”

California's law, SB 17, drew intense scrutiny from big law firms with pharmaceutical practices. Sidley Austin's client advisory called the new law “sweeping.” Covington & Burling said the law imposes “substantial new reporting and notification requirements.”

The Arnold & Porter team on the PhRMA complaint were Washington partners Robert Weiner, Jeffrey Handwerker and R. Stanton Jones. Downey Brand's Annie Amaral, a partner in the firm's Sacramento office, was also on the complaint.

More than a dozen pharmaceutical companies and associations—including AstraZeneca Pharmaceuticals, Amgen. GlaxoSmithKline and Pfizer—spent hundreds of thousands of dollars lobbying against SB 17 in 2017, state records show.

James Stansel, PhRMA executive vice president and general counsel, said in a statement:

“In this time of great innovation and advancement in therapies, we understand how important it is for patients to have affordable access to the medicines they need, but SB 17 is not only poorly conceived, it also misses the mark with its myopic focus on manufacturers and provisions that are in clear violation of the Constitution. The law creates bureaucracy, thwarts private market competition, and ignores the role of insurers, pharmacy benefit managers and hospitals in what patients pay for their medicines.”

PhRMA and the Biotechnology Innovation Organization sued the state of Nevada in September to block its new insulin pricing transparency law. Arnold & Porter, with McDonald Carano, represents PhRMA in that suit.

California Sen. Ed Hernandez, D-West Covina, called the lawsuit “just another example of Big Pharma refusing to accept any responsibility for the skyrocketing costs of prescription drugs. The idea that anyone other than drug companies is responsible for price increases is absurd. I'm confident the law will be upheld.” Hernandez, an optometrist, is running for lieutenant governor.

The case in California was assigned to U.S. District Judge Morrison England Jr.

PhRMA's complaint is posted below: