By the mid-eighties, the research-based industry was waking up very rapidly to the change. Of all the developments which it saw, the threat to its home markets in the west was undoubtedly the first to elicit a reaction. The initial reaction was, it would be fair to say, defensive and destructive. The theme was that generics were cheap, nasty, unreliable and generally outdated drugs (KANJI et al., 1992; CHODOS, 1980). Governments, health funds and physicians which exposed patients to such products were subjecting them to fearful risks. An article in the London Economist at the time, very clearly inspired by the views of the speciality manufacturers, was illustrated by the inevitable picture of the corrugated iron shed. Campaigns aimed directly at the public were designed to engender both fear and distaste of generics. In plenty of situations, the speciality industry at the time found ready support for its views from the wholesale trade and the pharmacists, who stood to lose substantially on their margins if the price of medicines were to fall; that support was subsequently lost in those countries such as Britain and France where the system of remuneration of the pharmacist was amended so that it no longer benefited from high prices.

That initial argument clearly did have an effect upon both prescribers and patients; in a world in which quality had become equated with price, and in which the concept that where illness was concerned no cost should be spared, the argument struck home. Both patients and physicians became effective lobbies for the speciality industry, pressing health funds and insurers to maintain the funding required to supply original drugs. The fact that, even after the expiry of the patent on its active substance, the original product usually continued to be sold under its original protected speciality name was an important weapon in its defence; that was generally the name by which it was most widely known and prescribed, and it was particularly easy to suggest to the physician and public that this was the only genuine, unadulterated and trustworthy product.

The initial, defensive argument still has to be examined, because it is still prominent. Is it true that generic drugs are bad? The first answer which I saw myself was one to which I had access since I was at the time - the nineteen seventies and early eighties - at work as a national drug regulator, and we were examining both generic and speciality drugs in the laboratory. Certainly the generic drugs which reached the regulatory table in a western European country did not generally strike one as bad. Very commonly, it seemed that the firms producing them, while generally not aspiring to basic innovation, had astute apothecaries and plant managers in their employment who were producing drugs of normal pharmacopoeial standards. There were indeed some examples of innovation; it was as if some speciality manufacturers had allowed their pharmaceutical processing to stagnate for two decades, while generic firms taking up production of the same drugs much later had benefited from new ideas; it was not unknown to find that a generic product had better release and availability characteristics than the equivalent speciality. Naturally there were exceptions; I recall a case where the human bioavailability data had clearly been forged at a desk, and another where oddities in the chromatogram caused a lot of concern. The data sheets, although they were usually inspired by those of the original speciality, also tended to betray some inexperience. By and large, however, the generics did not stand out as lesser products. That has been the experience of other agencies as well, including the United States FDA (ESSENTIAL DRUGS MONITOR REDACTION, 1991).

On the other hand, working twenty years later with African countries and international agencies, I indeed encountered a more heterogeneous quality picture in drug supply. Many of these countries had traded heavily with what was then the socialist block, including China, and products from those sources tended to be only marginal in quality. Many others were building up a heavy trade with South East Asia and here one encountered every degree of variation, from first class products of world standards to preparations which had the wrong active components or none at all. What I want to stress, however, is that these problems were not specifically, and indeed not in the first place, a matter of plain generics; it was as if most generic producers were aware that in a lot of markets they would encounter quality control centres with high standards. The worst problems related to quite a different class of products, namely falsified specialities, with names and trademarks intended to confuse the prescriber and the patient. This distinction deserves to be made, since the entirely laudable campaigns to counter what are called «false, spurious and substandard drugs» very easily spill over into the generic field, carrying with them the suggestion that only the original speciality of the western innovator is truly to be trusted.

So much for the initial, defensive, reaction of the speciality industry. Its second reaction was in fact much better conceived. To put it briefly, it reflected the old adage, «if you can't beat them, joint them». Speciality manufacturers had for a long period had the custom of supplying their older specialities in part in generic form at favourable prices. Health funds, hospitals and charities had long demanded lower prices than those asked for the specialities and enterprising manufacturers had quietly met the demand. The «generic» version of a drug was commonly sold in some manner which would isolate it from the general market and prevent its undermining speciality sales - for example, it would commonly be supplied only in bulk or in large packages for hospital use. Similarly, niche markets had sometimes been catered for by providing specialities under alternative brand names, through a separate sales channel and at adapted prices.

With this practice well established it was not particularly difficult to speciality companies to enter the generic field themselves, either using their own reserve manufacturing capacity or by acquiring generic companies. The purchasing of Rugby Laboratories by Marion Merrell Dow was notable, as was the acquisition of Copley by Hoechst (Table 2). Quiet simply, the notion had taken root that a company which wished to grow further in the global pharmaceutical market would have to develop in both directions simultaneous, with income from the relative low-volume, high profit, high risk specialities complemented by earnings from the high-volume, low profit, low risk generics. As before the link between the speciality line and the generic business was not loudly proclaimed; indeed, many a company was content to continue defending the superiority of specialities with one voice while aggressively developing a generic market with the other.

TABLE 2. - Association of speciality and generic companies: some examples

Alongside the defensive and the expansive reactions to generics there were others; one was the argument that the use of generic drugs would undermine research and hence drug innovation by the speciality industry. That is an argument which has been pressed very hard with governments and drug funding agencies, and to which I want to return presently.