FAQs About U.S. Generics
What are generic drugs?
Generic drugs are versions of brand drugs whose patent terms have expired.
Generics are referenced by their chemical or generic names. For example, fluoxetine is the generic name for Prozac. Introduced in
2001, the generic costs consumers 96 percent less than the brand drug.
If generic drugs are the same as brand drugs, why do they occasionally
vary in shape, size and color?
All pharmaceutical products, whether brand or generic, vary slightly. Sometimes
a manufacturer patents the appearance of a branded drug, thus prohibiting a generic manufacturer from adopting it. However, the same
testing that assures batch-to-batch consistency for a brand product is used to ensure generic equivalence. Cosmetic differences
between the generic and brand product in no way impact the sameness or safety of the generic version.
What kind of savings can generics generate for American consumers?
Generic pharmaceuticals can cost 30 to 80 percent less than the equivalent brand product.
For every healthcare dollar spent on medicines, American consumers spend less than 20 cents on generic drugs versus 80 cents on brand drugs,
despite generic drugs being dispensed approximately 65 percent of all prescriptions.
In 2007, the average retail price of a generic prescription drug was $34.34.
The average retail price of a brand name prescription drug was $119.51, according to NACDS data. With healthcare costs rising exponentially,
generic prescriptions offer considerable savings, without sacrificing quality, safety or effectiveness.
How can generic companies offer products that are much less expensive
than brand products?
Generics are much less expensive than their branded counterparts in part because
generic companies spend much less on marketing. As there are often multiple generic competitors for each product, and because generics
are sold under the same chemical name, the limited incurred advertising and marketing expenses are generally used to promote the
generic's availability to trade customers (drug store chains, wholesalers and pharmacies).
In addition, generic product-development costs are much lower than those of
a brand product. Brand companies receive market exclusivity for an extended period of time to ensure they can recoup their investment
in new product development.
To market a generic equivalent of a brand pharmaceutical company's product
(after its market exclusivity has expired), a generic pharmaceutical company uses the Abbreviated New Drug Application (ANDA) process
of the Food and Drug Administration (FDA).
Under this process, the generic manufacturer uses safety and efficacy data supplied
by the brand company, and must only prove to the FDA that its generic product is equivalent to the branded product.
Generic drugs may save consumers money, but are they as safe and
effective as their brand counterparts?
Absolutely. To be approved, a generic must have the same active ingredients,
dosage form, purity, quality and manufacturing standards, amount of drug absorbed over the same time, and clinical effect as the
brand product. Regarding safety, the FDA requires all drug manufacturers and their facilities to adhere to specific guidelines,
called current Good Manufacturing Practices (cGMP), regardless of drug and manufacturer.
Do brand companies have more modern manufacturing facilities than generic companies?
No. Generic companies have facilities comparable to brand manufacturers. The FDA requires both
brand and generic companies to conform to the same high manufacturing standards, known as current Good Manufacturing Practices (cGMPs).
To ensure compliance with these standards, the FDA conducts nearly 3,500 annual inspections of both brand and generic companies.
Why isn't there a generic version available for all brand drugs?
When brand companies develop a new drug, they are generally given patent
protection for 20 years. The patent protects the drug's research, development and marketing activities. When the patent expires,
drug companies may only introduce generic versions after they are thoroughly tested by the manufacturer and approved by the FDA.
Importation seems to be a perfect answer to lowering prescription
drug costs. Why do the brand and generic pharmaceutical industries oppose this initiative?
The generic pharmaceutical industry opposes importation for several reasons.
First, data used to support importation considers only a handful of top-selling brand name drugs and exaggerates potential savings.
A more comprehensive representative sample of drugs purchased by U.S. consumers found that average prices in Canada, Germany,
Sweden and Switzerland were comparable to or higher than those when U.S. generic drugs were included in the comparison.
Second, the quality of America's prescription medicines is the highest in the world. Importation would significantly undermine
this quality standard. There is no mechanism for assuring whether imported drugs meet basic quality standards or are expired, sub-potent,
improperly labeled, contaminated or counterfeit. Importation places consumers in the dangerous position of "buyers beware," without
formal mechanisms to protect their safety.
Therefore, if importation is allowed, consumers could purchase medicines of questionable
quality, with no restrictions on amount or importation frequency. Because foreign pharmacies and wholesalers are not subject to FDA or
state oversight, there would be no assurance of appropriate drug handing, or an ability to prevent shipment of counterfeit or tainted
drug products directly to consumers.
When should a generic drug not be substituted for the brand name drug?
The simple answer to this question is: Never.
FDA-approved generic drugs must prove that they offer the same safety and
effectiveness as brand name prescription drugs. Although some groups would suggest that certain drugs, such as mental health drugs,
should not be substituted, there is no scientific or clinical evidence to suggest that the generic will not offer the same benefits
as the brand drug, at a substantially lower cost to the patient.
To whom can the consumer turn for more information about the benefits
of generic products?
The pharmacist plays a key role in explaining the quality, medicinal comparability
and financial benefits offered by generic products. Recent surveys show that when consumers discuss generic pharmaceuticals with their
pharmacists, the overwhelming majority conclude that generic products represent an important healthcare alternative, one that is as
safe and effective as the branded product. Physicians can also help educate and inform consumers on a particular medicine's generic
availability.
In addition, the FDA is an excellent resource for information about generic drugs.
Visit its website at www.fda.gov/cder/ogd/index.htm.
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