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Generic versus brand name drugs: What’s the difference?

generic drugs

Patients–and even some doctors—view generic drugs like generic knockoffs of their favorite breakfast cereal. You trade taste and quality for a lower price.

Prescription drugs do not work that way. A generic drug is a copy of a brand-name drug. It legally has to have the same active ingredients as the drug it copies and demonstrate to the Food and Drug Administration (FDA) that it performs in the same way as the original. Generic drugs may look different from the brand name because trademark laws require that an original drug’s appearance cannot be copied.

In a survey, 30 percent of U.S. adults either believed or were unsure whether generic medicines were as good as the brand name. Nearly one half of physicians also hold negative views about generics.

People typically tend to associate price with quality. In this case, a brand-name drug has a patent of up to 20 years, allowing it to price the drug high enough to recoup its research and development costs. Once the patent runs out, other companies that do not have those startup costs can make generic versions closer to the manufacturing price.

Not using generics is a missed opportunity. About $49 billion was spent in 2011 on brand-name drugs when a generic equivalent was available. Proper use of generics saved consumers and health insurance payers $235 billion in 2013. The FDA estimates generics cost 20 percent to 70 percent less than their brand equivalents.

Here is how you can ensure you are getting the most cost-effective medicine:

“Explore."
  • Ask your doctor or pharmacist: “Is there a generic for (insert brand name here)?” More than half of brand-name drugs have a generic option.
  • Review your prescriptions regularly with your doctor or pharmacist. Your brand-drug may have a new, low-cost treatment that you did not know about.
  • Go online. Find out what generic drugs the FDA has approved.
  • Price before you buy. Cliff Fullerton, MD, chief population health officer for Baylor Scott & White Health and chief medical officer of the Baylor Scott & White Quality Alliance, pointed out that patients often have a choice of brand vs. generic after they find out the price of each at the pharmacy.
  • Know the name and dosage of drugs you are taking so you can intelligently search for a generic equivalent. As Dr. Fullerton said, “It’s not just the little blue pill or green pill.”

About the author

Steve Jacob
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Steve is a senior marketing and public relations consultant for Baylor Scott & White Health. He spent nearly four decades in newspaper and magazine editorial and business management and is the author of two books on healthcare reform. He was also the founding editor of D Magazine's D Healthcare Daily.

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Generic versus brand name drugs: What’s the difference?