Leon's decision stated, "By choosing to exempt retailers of any liability for the excessive prices of the drugs they sell, the District has, in effect, overwhelmingly focused its enforcement effectively on out-of- state manufacturers and out-of-state transactions that 'result in' excessive retail prices within the district."

Under the statute, Leon pointed out, "manufacturers are essentially defenseless" against lawsuits.

"The D.C. City Council has now demonstrated just how much mischief economic idiots can do," said Merrill Matthews Jr., director of the Council for Affordable Health Insurance. "Did anyone bother to tell the Council that manufacturers of a product often don't determine the final retail price, especially when the products generally go through one or two middlemen, as pharmaceuticals do? Pharmacies set the prices at the retail outlet, and pharmacy benefit managers (PBMs) act as middlemen for most drugs sold.

"So if the brand name drug company does provide the discount but the pharmacy doesn't pass it on, who is the consumer to sue? I think the right answer to that question is the D.C. City Council," Matthews said.

The National Legislative Association on Prescription Drug Prices (NLARX), a nonprofit group promoting accessible and affordable prescription drugs, cited the D.C. measure on its Web site as "model legislation." Catania is vice chair of NLARX.

"Residents of the District of Columbia as well as Americans everywhere count on prescription medicines to protect their health, improve their quality of life, and in many instances keep them alive," PhRMA President and CEO Billy Tauzin said in a statement following the decision. "The discovery, testing, and manufacturing of medicines are vitally important parts of the overall American health care system. This nation leads the world in the development of new medicines because of the market-based system in place that rewards innovation and drives future discovery.

"Today's decision by the U.S. District Court protects both patients and the quality health care we enjoy in this country," Tauzin concluded.