Generic Medicines from a Societal Perspective: Savings for Health Care Systems?
(2008; 5 pages)

Abstract

Despite the emphasis placed on generic policies, as a means of creating savings to health insurance budgets, there seems to be a lack of robust evidence on their effectiveness. By studying generic policies in seven OECD countries (USA, UK, Germany, France, Italy, Spain, Canada) and for a number of drugs, we find that generic penetration varies significantly among them and could be enhanced further, particularly in France and Italy, but also Spain and Canada. We also find that generic price decline post patent expiry is variable and that countries regulating generic prices, e.g. through price capping or reference pricing, display significantly lower price declines over time compared with countries that do not. As generic savings are influenced by the combined effect of genericisation and price reduction post-patent expiry, we conclude that significant additional savings to health insurance can be realised – up to 43% of current generic sales – if generic purchasing and genericisation improve further.

 
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