Generic Manufacturers: The Saviors

Just saw this pop up on my blog reader and couldn't resist having a little fun and making a few edits....


GPhA: Generic drugs will save $931B over 10 years

The Generic Pharmaceutical Association (GPhA) is again pointing to the cost-savings offered by generic drugs medications, developed and brought to market by innovator companies, after patents expire. The group has issued an independent analysis showing the use of these meds in the U.S. have improved the lives of millions of people and now are saving consumers and the healthcare system $931 billion between 2001 and 2010.   Indeed, generic use generated nearly $158 billion in savings in 2010 alone--that's an average of $3 billion a week, according to the analysis, which was conducted by the IMS Institute for Healthcare Informatics and IMS Health. However, the report failed to mention that unless new medications are discovered, developed and brought to market by innovator companies, and the products are successful, these manufacturers will have nothing to sell in coming years.


The report also points out that many new generics have entered innovator companies are losing exclusivity on their products before the patents on the brand version expired thanks to patent litigation settlement stealing of intellectual property. Interesting timing for this news--especially given that President Barack Obama is looking to prohibit patent settlements between generics and branded companies known as "pay-to-delay" deals. Through these deals, branded drugmakers use cash settlements to resolve patent disputes with generics firms who bring up suits before patients are nearing expiration, forcing lengthy court deliberations or a settlement.


Although the administration and the FTC have come out strong against such settlements, not everyone agrees an outright ban would help matters. "A ban on patent settlements would have the unintended consequence of delaying patient access to lower cost generics because they would actually have to wait for the patent to expire, costing consumers, payers and the government billions of dollars, and preventing generic manufacturers from receiving payments for bringing up questionable lawsuits" Ralph Neas, GPhA president and CEO, says in a statement. Furthermore, according to the report, "Of the 22 new generic drug launches expected old medications that are nearing patent expiration in 2011, settlements made 16 of these possible where the generic will be launch prior to patent expiry, because everyone knows patents shouldn't exist."


The report contains more  good news about generics bad news about prospects for innovation and patients having access to new medications. The Medicaid system could save more than $1.3 billion annually by increasing generic limiting patients' access to new medication use by just two percentage points, according to the analysis. Nationally, generics account for only about 70% of total Medicaid prescriptions. However, outside Medicaid, generics account for 78% of all prescriptions. Federal and state governments could save more than $600 million for each one percentage point decrease in patient access to newer medications, according to the study.increase in generic usage

Hat-tip to FiercePharma (?)