Generic drug or what are generics

Generic drug (plural generic drugs, in abbreviated form - generics) - is medicament that is bioequivalent to registered patent medicine taking into consideration its pharmacokinetic and pharmacodynamic features. These drugs are usually sold cheaper than patent pills. Generic medicine should contain identical active ingredients of the same efficacy as originals do. Also it should be bioequivalent and meet the same requirements of the producer. In that way, in the wide sense, generics are supposed to be identical in dose, efficacy, prescription, safety, effectiveness and end use.

Reasons of low price.

The main reason of law price for unlicensed drugs is the fact that companies spend less, producing generics and that is why they are able to suggest lower price keeping up profitability at the same time. Producers of unlicensed drugs are able mainly to escape three inputs which other pharmaceutical companies face:

1. Inputs, connected to investigation and development of a drug;
2. Inputs, connected to overcoming of governmental bureaucratism to suggest a medicine as safe and effective on the market;
3. Market-value.

First of all, the producers of unlicensed drugs should not spend their money for search and investigation of new medicament for treatment of disease because they already have access to adequate information concerning patent pills. Such information allows them to produce bioequivalent variant of a medicine with identical effect. In the second place, the producers of generics should not prove that their product is safe and effective carrying out clinical trial. The only thing they should demonstrate is bioequivalence. In the third place, these companies get a very big profit from selling that is promoted by original preparation.

Drugs that are sold by producers of generics were already bought on the market and that is the reason why they do not need additional advertising. The same reason is for fact that producers of generics should not make test doses to promote their product. Important investigations, development and market inputs that pharmaceutical companies pass while promoting new preparation into the market, are often called the reasons of high price- as companies want to defray expenses before term of patent protection expires. Producers of generics do not have such spending as tests for bioequivalence and the producing process cost comparatively little and as a result the price is much lower than original medicines cost.

How is it possible to produce generics?

It is possible to produce generics legally, when:

1. Patent term has expired;
2. Unlicensed company guarantees that patents of brand company are invalid, do not have validity or broken;
3. Medicines have never had patent;
4. In countries where patents are not valid.

Expiration of term of patent protection transfers exclusive domain of the owner of patent to meds selling licensing.

It also becomes very popular for pharmaceutical companies to accrue a right for producing their own generics grant a license to their products at unlicensed companies. So, in some cases generic may be a patent product but in another form. Price Competition and Patent Term Renewal Act accepted in 1984 and known as “Hatch-Waxman Act”, has standardized the procedure of generics recognition. A pretender registers ANDA (Abbreviated New Drug Application) with FDA (Food and Drug Administration) and tries to demonstrate therapeutic equivalence to a certain medicine approved and described earlier. When ANDA is approved FDA adds the preparation to the list of approved drugs known also as “Orange Book” and annotates the list to show the equivalence between recommended roll of drugs and approved generic. FDA also admits preparations with similar ingredients of different bioavailability and divides them into therapeutic groups according to their equivalence.

The problems of patent endurance and investigation cost.

Pharmaceutical companies may produce generics when patent for original preparation has already expired. Patent endurance is not the same for various medicines in different countries. Usually it is impossible to renew a patent after expiration of its period of validity. It is possible to take out a patent for new version of preparation with significant modifications in the structure but it will require new clinical trials. Usually generics are much cheaper then their originals. But some patients as well as doctors will not get a move on with buying them as they worry about their quality. When a company starts to put a product into the market it always happens in accordance with patent that allows selling it only the company which worked it up. This lets a company compensate the cost of certain drug elaboration. On average a company spends about $800,000,000 to process and test a new drug before it is approved to be used. After expiration of term of patent protection any pharmaceutical company may produce and sell it. Since a preparation is tested and approved, the cost of producing will contain only a small part of real price of its processing and testing.

Brand companies often contest right to a patent and protection of their products; they also try to impede generics market entry. Critics call this process “evergreening”.

Bioequivalence guarantee.

In the USA FDA is responsible for safety and effectiveness of unlicensed drugs. The process of generics approval started in the latest 1960s. Generic producers had to prove that their recipes were bioequivalent to the originals. During last years some investigations showed safety and effectiveness of some generics. Generics are always cheaper and may save a lot of money to patients and insurance companies often without deterioration. FDA just should approve generics like patent medicines. However bioequivalence does not mean that generics are exact copy of their patent analogues as chemical difference exists all the same. Some doctors and patient are absolutely sure that generics can not be so effective like preparations which they intend to substitute, but customers, of course, will take the profit after many clinical trials made on basis of such medicaments. Generics start to exist being quite expensive; however these drugs become cheaper and cheaper as a result of large volume of output.

180 days of exclusive domain for generics.

In some cases FDA suggests 180 days of exclusive right for generics producing. During this period only one (sometimes several) producers may put on the market unlicensed version of a drug. It may happen only if a producer agrees that patent is not violated and this period lasts in the form of compensation to producer who is ready to risk bill of debt and costs in the court. Usually during this period there is a dispute because producer should not produce a preparation at this time and may be the first who lodges a written request to prevent others from these drugs selling. Big pharmaceutical companies usually spend a lot of money protecting their patents from such disputes.

In addition to judicial contest, the companies use other methods like formula remaking or licensing of subsidiary for generics selling. Such preparations are known as authorized generics. 180 days of exclusive domain is not extended to them as they are under control of patent holder. Zocor- is a popular medicine that may become a first example to show how it works. It is created and produced by American pharmaceutical company Merck&Co which forfeited a patent on 23 of June, 1996. Indian Ranbaxy Laboratories and Israeli Teva Pharmaceutical Industries got 180 days of exclusive domain for Zocor. According to the popularity of Zocor , both these companies started to sell it the moment term of patent protection had expired. However Dr. Reddy’s Laboratories also authorized the drug under the license Zocor, Merck&Co. Some agreements of Dr. Reddy even name Merck a real producer and have its logotype.