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The cost of generic and name-brand drugs

More prescription medications now come in generic versions. But do you ever choose savings over quality?

generic and name-brand-drugs
Image: AlonsoAguilar /Thinkstock

Medication can be an unpredictable and costly expense. Whether it is short-term treatment or multiple drugs you take indefinitely, prescriptions can have a serious impact on your wallet.

Nowadays there are many generic versions of brand-name drugs that are often significantly less expensive. There are generic drugs to treat most common ailments, such as pain, high cholesterol, high blood pressure, diabetes, asthma, and depression.

The advantage of generics is the obvious cost savings, but they also play a larger role in medical treatment, says Dr. Niteesh K. Choudhry, a researcher with the division of pharmacoepidemiology and pharmacoeconomics at Harvard-affiliated Brigham and Women’s Hospital. “The lower cost can make it easier for people to continue to take their medications as intended,” he says. “Higher costs can force people to stop taking their medication after a while, or even not begin treatment.”

But the questions remain: Is there a difference between generic and name-brand other than price? Do you ever sacrifice quality for savings? To better understand this, you have look at how drugs are manufactured and prescribed.

Types of generics

There are two ways of replacing brand-name drugs: generic substitution and therapeutic interchange. Generic substitution means the generic drug is the equivalent to a name-brand drug on a molecular level. “In terms of effectiveness and quality they are the same, and the FDA has certified that both are equal,” says Dr. Choudhry. An example is the cholesterol drug Lipitor and the generic version atorvastatin.

With therapeutic interchange, the generic is a medical substitute that is related on a molecular level, but not exactly the same. “It is like the difference between a Coke and a store-brand cola,” says Dr. Choudhry.

Does that mean therapeutic interchange drugs are just as effective as brand-name versions? For the most part, yes. “It depends on the drug, what it is designed to treat, and the person, but it often is equally effective,” says Dr. Choudhry. Research supports the effectiveness of both types of generic drugs. A report published Jan. 5, 2016, in Annals of Internal Medicine advocated the greater use of generic drugs, citing research that supports their overall equality with brand-name counterparts as well as valuable cost savings.

The high price of drugs

Why are generic drugs so cheap? It is simple: generic manufacturers do not have the same costs as brand-name drug companies.

Brand-name companies invent the drug and put it through various research trials. Once the FDA approves the drug, the company must invest in marketing, advertising, and distribution. It’s a long and costly process.

A company holds a patent on a drug for 20 years. However, the patent dates from when the drug is invented. It still may take many years before the drug reaches the marketplace, which can shrink the time frame for the company to make back its investment and any profit. Once the patent expires, and because the formula is already known, other companies can make their own generic versions and charge much less.

Consult with your doctor

Do not assume your doctor will always offer you the choice of a generic drug. A 2016 ProPublica analysis found that doctors who receive payments from the pharmaceutical industry tend to prescribe more brand-name drugs, on average, than those who do not. The report does not prove that industry payments sway doctors to prescribe specific drugs, or even a particular company’s drugs, but it does show that payments are associated with that trend.

Even if doctors are not part of this arrangement, they may prescribe brand-name drugs based on their medical preference and past success with patients. Also, doctors may not know a generic version or a therapeutic interchange has become available.

Dr. Choudhry suggests that patients need to be proactive when they are given a prescription, and always inquire if there are generic versions available. In many states, pharmacies can switch to a generic substitution—but not a therapeutic interchange—as long as there is no “dispense as written” requirement from your doctor.

If you are not successful with one type of generic drug, you do not have to switch to the name-brand version. “Some drugs have multiple generic versions,” says Dr. Choudhry. “So often you have more options from which to choose.”

Posted by: Dr.Health

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