Generic Equivalent Drugs Have The Ability To Cut Your Costs
A drug manufacturer invests money to develop new medications
. This process costs time and money to do the research and clinical trials. This is a large investment and generic drugs do not have that expense attached to them. After the drug is approved, the company holds a patent on that drug.
The Federal Drug Administration imposes a time limit on the patent. The length of time one remains in effect varies from country to country. Once the patent has expired, other manufacturers are entitled to produce a generic version of the drug.
All generics are required to have the same ingredients the original formula contained. Requirements are put in place by the Federal Drug Administration. A generic version must contain the same or nearly the same active ingredients as the original brand name does.
The cost of generic drugs is much lower than the brand name for two good reasons. They are copied, which relieves them of the expense of research and clinical trials. Another reason is that more than one company can manufacture a generic version.
Where competition exists, price goes down. The generic producers compete for the consumer's dollar and it keeps prices low. It is only natural for a consumer to buy the cheaper product as long as the quality is maintained.
Generic drugs can be manufactured cheaper in some countries. India is one example. It is because the workers are paid much less in wages than workers in the United States.
President Obama signed a new law into effect on March 23, 2010. It gives the FDA the task of approving generic formulas before they can be produced and sold. The original developing company is granted twelve years of exclusivity. After that time period, a generic version can be made and put on the market. The new law is called the Patient Protection and Affordable Care Act.
More generics are sold in the US than any other single country. When the patent protection expires on current brand name drugs, a large portion of them will be produced as generics. Generics medications already have approximately 78% of the US pharmaceuticals market. The implications of this fact on the market are yet to be seen.
All prescription drugs cost money to ensure safe manufacturing. One component of the cost of pharmaceuticals is the high cost of advertising on TV. It is obvious that the profit margin is higher as a result of those expenditures.
The cost is high for advertising. It does not point out to the consumers that generics can be produced in India for a portion of the cost it takes to produce them in the US. The large drug manufacturers have factories in India. These drugs are made safely at a fraction of what consumers pay for them. Yet, they imply it is unsafe to buy drugs from overseas.