This interesting article describes how the cost of generic drugs is deliberately kept high to protect the name brand drugs.
Let’s Bring Down the Outrageous Cost of Generic Drugs: New Action Alert!
October 31, 2011
Bill Faloon of the Life Extension Foundation has a great idea. We need to help him sell it to Congress.
Generic drugs are always cheaper than their name brand equivalents, of course. But they’re still ridiculously expensive—especially considering the active ingredients may cost only pennies per day.
What can we do about this? First, allow supplement makers to produce them, a bold idea first proposed by Bill Faloon in 2009. The FDA doesn’t currently allow that. Why not? This is just another example of the FDA trying to defend drug company monopoly profits.
Second, cut through all the needless red tape, also designed to protect patent drug producers. As you will read below, the red tape is inexcusable. Why are human trials needed to reproduce a drug that has already gone through the full FDA approval process?
In general, generic drugs cost way more than they should—if they are available at all—because of a crony capitalist regulatory environment that needs to be completely reformed.
Another major element driving up the cost of generic drugs is bioequivalence testing. If a company wants to manufacture a generic drug, be it a prescription drug like finasteride or an over-the-counter drug like ibuprofen, it must file an Abbreviated New Drug Application (ANDA) with the FDA, even if it is manufactured by others already. The company doesn’t have to perform clinical trials for an ANDA, but it does have to show that it’s biologically similar, or “bioequivalent,” to the original drug. For drugs that are difficult to synthesize, this requirement is important. For most drugs, however, the raw material can be purchased, often from the identical supplier that provides it for the branded drug.
To show bioequivalence, the company typically needs to perform human studies that take nearly two years. This can be waived, but it’s up to the FDA.
Some Other Generic Drug Scandals
- Foot-dragging: The FDA’s Office of Generic Drugs currently has an estimated 1,900 different generic medications awaiting action—and the approval time for generic applications has slowed until it averages more than 26 months.
- Name-brand preference: Pharmacy chains get money from drug manufacturers to push their name brands instead of generics. A bill in the previous Congress (HR 5234) would have made transparent exactly how much money the pharmacies are receiving from pharmaceutical companies to promote drugs still under patent, but it died in committee.
- Pay-to-delay: Bayer AG paid rival drug makers nearly $400 million to stay out of the generic Cipro market. By paying competitors to delay their challenges to the patent, they are ensuring an exclusive market for themselves—and the ability to charge whatever they wish.
What We Can Do About This Mess
We can’t really fix this without new legislation, as proposed in 2009 by Bill Faloon. Such a bill should allow supplement companies to produce and sell generic drugs. It should also eliminate the red tape (including human trials) that is needlessly preventing generic competition and thus artificially preserving patent drug profits.
Life Extension is already selling generic drugs through its unique online pharmacy at a fraction of the price available elsewhere. If you need drugs, this is a great resource to know about and take advantage of. But with new legislation, all generics could sell for much less.
Please take action now. Let’s get the ball rolling by contacting our senators and congressional representatives and asking them to fix the generic drug mess.
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