Generic Drugs: What Are They?

Generic Drugs: What Are They?

A generic drug is identical, or bioequivalent to a brand name drug in dosage form, safety, strength, route of administration, quality, performance characteristics and intended use. Although generic drugs are chemically identical to their branded counterparts, they are typically sold at substantial discounts from the branded price. According to the Congressional Budget Office, generic drugs save consumers an estimated $8 to $10 billion a year at retail pharmacies. Even more billions are saved when hospitals use generics.

Drug companies must submit an abbreviated new drug application (ANDA) for approval to market a generic product. The Drug Price Competition and Patent Term Restoration Act of 1984, more commonly known as the Hatch-Waxman Act, made ANDAs possible by creating a compromise in the drug industry. Generic drug companies gained greater access to the market for prescription drugs, and innovator companies gained restoration of patent life of their products lost during FDA's approval process.

New drugs, like other new products, are developed under patent protection. The patent protects the investment in the drug's development by giving the company the sole right to sell the drug while the patent is in effect. When patents or other periods of exclusivity expire, manufacturers can apply to the FDA to sell generic versions. The ANDA process does not require the drug sponsor to repeat costly animal and clinical research on ingredients or dosage forms already approved for safety and effectiveness. This applies to drugs first marketed after 1962.
Health professionals and consumers can be assured that FDA approved generic drugs have met the same rigid standards as the innovator drug. To gain FDA approval, a generic drug must:

* contain the same active ingredients as the innovator drug(inactive ingredients may vary)
* be identical in strength, dosage form, and route of administration
* have the same use indications
* be bioequivalent
* meet the same batch requirements for identity, strength, purity, and quality
* be manufactured under the same strict standards of FDA's good manufacturing practice regulations required for innovator products

For more information on the safety and effectiveness of generic drugs, please see:

* FDA Generic Drugs Final Rule and Initiative
* Consumer Education: Generic Drugs
* Generic Competition and Drug Prices (4/4/2006)
* FDA White Paper: New FDA Initiative on "Improving Access to Generic Drugs." (6/12/2003).
* FDA White Paper: Generic Drug Prices in the U.S. Are Lower Than Drug Prices in Canada. (11/2003)
* FDA and the Drug Development Process: How the Agency Ensures that Drugs are Safe and Effective (2/2002) [HTML] or [PDF]. Spanish version: [HTML] or [PDF]
* FDA Ensures Equivalence of Generic Drugs. PDF document From the 1999 edition of "From Test Tube to Patient: Improving health through human drugs."
* Generic Drugs: Safe. Effective. FDA Approved. Public service announcements promoting the safety and effectiveness of generic drugs.
o Six Public Service Announcements