Statement by Chip Davis, President and CEO, GPhA, Regarding Generic Drug Costs
Contact: Steve Arnoff 202.249.7113
WASHINGTON, DC (September 22, 2015) –
“Turing is not a GPhA member and has no relationship with GPhA. No single company and no single product represents the entire generic drug industry which has an undeniable record of patient savings and access. In fact, generic drugs were responsible for $239 billion in health savings in 2013 and $1.46 trillion in savings over the most recent decade. Any inquiries relating to Turing should be directed toward the company itself.
Generic medicines are a critical part of system-wide efforts to hold down healthcare costs. It is important to remember that FDA-approved generic drugs remain significantly more affordable than costly brand drugs while being just as safe and effective.
Recent data shows that the generic cost trend continues to decline. In fact, drug costs are a small portion (approximately 10%) of overall health system costs and generic drugs are an even smaller fraction of that expenditure. Rather than targeting one of the few industries that has demonstrated success saving people billions of dollars, GPhA welcomes a constructive discussion on what can be done to keep prescription drugs affordable while balancing innovation and competition.
Generic drug manufacturers can proudly point to a legacy of savings and access that brings expensive treatments within reach for millions of people:
oThe IMS Institute for Healthcare Informatics found that generics saved $239 billion in 2013 (a 14% increase in savings from 2012) and more than $1.46 trillion over the recent decade.
o The 2014 Express Scripts Drug Trend Report shows that since 2008, the price of brand drugs has almost doubled but the price of generic drugs has been cut roughly in half.
o A May 2015 report from AARP notes that retail prices for generic drugs fell an average of 4% in 2013, marking nearly a decade of consecutive years of decreasing generic drug costs. The report also notes that 73% of generic drugs in the study experienced price decreases.
o An August 2015 Drug Channels blog noted that in the second quarter of 2015 almost half (44%) of generic drugs experienced a decline in cost.
Patients, taxpayers and others will find no better partner than the generic industry in efforts to reduce health expenses and promote savings and access. The best way to accomplish this is to increase competition from generic drugs. GPhA believes that policymakers should take the following key steps to increase generic competition:
o First, in partnership with the industry, Congress should encourage the timely FDA review of the more than 3,000 generic drug applications that have been filed with the agency. Once those are approved, consumers will have more options than ever, and that will help drive down prices.
o Second, Congress should review the abuse of programs designed for protecting patient safety, such as REMS, that some brand companies are misusing as a way to keep generics out of the market. This practice lowers competition and keeps prices high. A recent study by Matrix Global Advisors estimates that countering this misuse could save the health system $5.4 billion.
o Finally, Congress should encourage the FDA to increase competition for biologics by enacting regulations for biosimilar approvals and supporting a naming policy that encourages competition from safe, more affordable biosimilar medicines.
Taken together, these policies would provide American consumers with more choices, greater access to medicines, and billions of dollars in increased generic drug savings.”
GPhA represents the manufacturers and distributors of finished generic pharmaceuticals, manufacturers and distributors of bulk pharmaceutical chemicals, and suppliers of other goods and services to the generic industry. Generic pharmaceuticals fill 86 percent of the prescriptions dispensed in the U.S. but consume just 27 percent of the total drug spending. Additional information is available at gphaonline.org. Follow us on twitter: @gpha.