| As the U.S. Food and Drug administration (FDA) has put it, to gain FDA approval, a generic drug must: contain identical active ingredients as the innovator medicine (inactive ingredients may differ), be identical in concentration, dose form and mode of administration; comply with the same batch requirements for identity, concentration, quality and purity; be made under the same fixed standards of FDA's Good Manufacturing Practice regulations mandatory for trade name products. To put it differently, their pharmacological effects are exactly the same as those of their trade name versions.
Although generic medications are chemically identical to their brand name counterparts, they are normally sold at substantial discounts from the brand name price. It is estimated that generic drugs save customers $8 to $10 billion per year at retail pharmacies. Even much more money is saved when hospitals use generic medications.
The chief reason for the comparatively low price of generic medications is that competition goes up among manufacturers when drugs no longer are protected by patents. Companies spend less money on creating a generic medication, and are, therefore, able to sustain profitability at a lower cost to customers. The costs of these generic drugs are so low that many developing countries can easily afford them. For instance, Thailand is going to import millions of doses of the generic version of Plavix, a blood-thinning drug to forestall heart attacks, at a price of 3 US cents per dose from India, the leading producer of generic drugs.
Producers of generic medicines do not incur the price of drug discovery, and instead are able to reverse engineer known medication compositions to allow them to make identical versions. Companies do not bear the burden of proving the safety and effectiveness of the medications through clinical studies, as these tests have already been conducted by the trade name company.
Generic drugs may sometimes be molded differently than branded versions, such as a generic pill versus a brand name capsule. However, they have the same active ingredients and are made under the same standards as branded drugs. |
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