Sure why not? The government is just exercising its power as a purchaser.
'why not'? It's retaliatory beyond all proportionality, for one.
They are not "just a purchaser" though. It's the world's most powerful organization that is funded by the people and is supposed to be for the people. I'm all for businesses making FAFO decisions, but expect a lot more here.
Exercising its power as a purchaser is "not buying it" or "choosing a competitor." Instead, this is arbitrarily and capriciously using an administrative mechanism in a novel way to punish a company.