| According to the U.S. Food and Drug administration (FDA), to receive FDA approval, a generic medication must: contain the same active ingredients as the trade name medication (inactive ingredients may vary), be bioequivalent in potency, dose form and mode of administration; meet the same batch requirements for identity, concentration, quality and purity; be produced under the same strict standards of FDA's Good Manufacturing Practice regulations mandatory for original products. To put it differently, their pharmacological effects are exactly the same as those of their brand name counterparts.
Though generics are chemically bioequivalent to their brand name versions, they are ordinarily sold at considerable discounts from the branded cost. According to the Congressional Budget Office, generic medications save customers an estimated $8 to $10 billion annually at retail pharmacies. Even much more money is saved when hospitals use generics.
The main reason for the relatively low price of generic medicines is that competition escalates among producers when medicines no longer are protected by patents. Manufacturers incur fewer costs in creating a generic drug, and are, thus, able to sustain profitability at a lower cost to customers. The costs of these generic medicines are so low that many developing countries can easily afford them. For example, Thailand is going to import millions of doses of the generic version of Plavix, a blood-thinning treatment to forestall heart attacks, at a cost of 3 US cents per dose from India, the leading maker of generic drugs.
Producers of generic drugs do not incur the price of medication discovery, and instead are able to reverse engineer known drug compounds to allow them to manufacture identical versions. Producers do not bear the burden of proving the safety and effectiveness of the medicines through clinical tests, since these trials have already been carried out by the trade name firm.
Generics may at times be molded differently than brand name versions, such as a generic tab versus a brand name capsule. Nevertheless, they have the same active ingredients and are made under the same standards as branded medicines. |
