Generics — brand-name drugs without the brand name — can save consumers big money. They’re pharmaceuticals that, because they’re no longer covered by patents, can be manufactured by any drugmaking firm and not just the ones that invented them. A generic drug’s active ingredients are the same as those in the name-brand version, as are their “dosage form, safety, strength, route of administration, quality, performance characteristics and intended use,” according to Food and Drug Administration regulations.
Generics have been a huge success. A generation after they entered the U.S. market, they represent nearly 70 percent of all filled prescriptions. They have saved the health-care system billions of dollars. The Congressional Budget Office estimated a savings in 2007 of $33 billion just for Medicare Part D and its beneficiaries. Add in everyone else who buys pharmaceuticals, and the savings are even greater. A report released last summer by IMS Health, a market research firm, concluded that generic drug use “saved the American health care system more than $824 billion over the past decade, and $139.6 billion in 2009 alone.”
It has worked so well in part because of the role played by pharmacists. In many states, the law mandates that pharmacists deliver a generic version whenever available, even when the doctor has prescribed a brand name.
An exception to the rule
But there’s an exception to this mandate, a provision that some might see as a loophole. It’s called “Dispense as Written.” In most states, those words on a prescription — usually in the form of a check mark beside a box with the letters DAW — overrides the mandate.
In the American Journal of Medicine article, researcher doctors noted that out of a sample of 5.6 million prescriptions written for more than 2 million patients, nearly 5 percent “were designated as dispense as written by physicians and patients.” This, perhaps, is not a very large portion, but the money that might have been saved is substantial. Noted the authors: “By substituting the generic alternative for each . . . brand that was filled . . . the patient population in this sample could have reduced their charges by more than $1.7 million and the health plans could have experienced more than a $10.6 million reduction in costs in the 1-month study period.”
How big is the price difference between generics and brand-name drugs? Quite big. Take, for example, the popular anti-cholesterol drug Zocor. According to Drugs.com, a 90-pill bottle costs $459.98. But 90 pills of simvastatin, the generic version of Zocor, are only $83.97. Buy simvastatin at Wal-mart or Target, which offer special pricing programs, and the cost comes down to just $12.
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