In 2007, generics accounted for 67% of the US market, up
from 63% in 2006 according to IMS data shared by the
generics industry association, GPhA. In 2008, drugs with over
$20 billion in sales lose patent protection, augmenting the
pipeline substantially. Generics accounted for 20% of dollars
spent as prescription drugs last year, up from 17% in 2003. At
Patient Benefit Managers such as Costco, overall drug costs
increased 2% in 2007, compared with 5.4% in 2005. This was
largely due to the huge pipeline of generic drugs that began
to come off patent and this pipeline extends to 2015.
Healthcare (after the economic situation) is one of the
topmost priorities for candidates for the Presidential
elections. Although the stance taken differs marginally, it
continues to be pro-generic. One of the democrat candidates
has gone on record saying that if elected President, they
would increase funding for FDA's Office of Generic Drugs to
speed reviews of new medicines and eliminate loopholes in
US law that allow Big Pharma to block generic copies.
Another Democrat candidate has said he would prevent
brand name pharma from blocking copies and would
encourage wider use of generics in US health programs
including Medicare for the elderly & Medicaid for the poor.
The leading Republican candidate, has briefly mentioned
that he would support laws that would allow Americans to
buy drugs from Canada and other countries. He has also
proposed improvements in the approval process for generics & biotech medicines.
As more generics come off patent, brand name companies
began to increase the price on commonly used medicines in
order to protect margins. For example, AARP, an advocacy
group pointed out that Big Pharma raised the price of 220
branded medicines most commonly used by senior citizens
as part of Medicare part D prescription drug plans.
Annual growth in the generic market was 3.8% according to
IMS after years of 10-20% increases, due to pricing pressure
on generics shortly after patent expiry, larger number of
players, some impact of large chains like Wal-Mart & Target
offering generics at substantially reduced prices such as
$4/mo.However, this decrease in prices was not matched by
an increase in volumes.
Medicare & Generics growth >>
