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The Associat ion The Indust ry Generic Medicines Board of Direct ors St aff Membership Careers Cont act AMRI

The Industry
In the 1960s, a government effort to prove the safety and effectiveness of pharmaceuticals manufactured prior to 1962 helped to launch the generic pharmaceutical industry. In 1962, the National Research Council of the National Academy of Sciences was instructed to evaluate all drugs that had been approved for use prior to that year. Under its Drug Efficacy Study Implementation (DESI) program, the National Research Council reviewed more than 3,000 products. The list produced by this review described which products were effective for all claimed indications, which were probably or possibly effective for claimed indications, and those which were ineffective for claimed indications. As a result of the review, generic manufacturers were able to file for approval to manufacture products that had been ruled effective without the need to conduct biostudies. Thus, a number of pre-1962 medications, if made to the prescribed chemical formula, were able to enter the market without additional study. It wasnt until passage of the Drug Price Competition and Patent Term Restoration Act of 1984, commonly known as Hatch-Waxman, that the generic industry truly blossomed. This landmark law created the regulatory mechanism under which the Food and Drug Administration can approve affordable pharmaceuticals. As President Ronald Reagan said at the time, Hatch-Waxman provided regulatory relief, increased competition, economy on government, and best of all, the American people will save money, and yet receive the best medicine that pharmaceutical science can provide. Over nearly three decades, President Reagans prediction has proven to be true. The generic industry has grown dramatically and use of generic drugs has saved the U.S. health care system approximately $1.07 trillion over the past decade alone (2002 through 2011) with $192.8 billion in savings achieve in 2011 alone. From a modest beginning, today nearly 80% of all prescriptions are filled with generic medicines.

Our Industry
Brand pharmaceutical sales for 2011 account for 73% of total dollars spent in the U.S. on prescription medicine (Source: IMS Health, National Sales Perspectives, Nov. 2011, National Prescription Audit, Dec. 2011) Generic pharmaceuticals fill 80% of the prescriptions dispensed in the U.S. but consume just 27% of total drug spending. (Source: IMS Health, National Sales Perspectives, Nov. 2011, National Prescription Audit, Dec. 2011) The top five U.S. corporations by unbranded generic prescriptions dispensed are Teva Pharmaceuticals USA, Mylan Labs, Inc., Actavis (formerly Watson Pharmaceuticals), Sandoz (Novartis), and Lupin Pharma respectively. By the end of 2016, brand biologics with $40 billion in U.S. sales will come off patent. Combining that number with the more than $20 billion in brand biologics that are already off patent, this represents more than $60 billion in annual spending in the U.S. (Source: Grant Thornton, Bio-dynamism: Insights into the Biosimilars market: An Overall Perspective, Feb. 2013)

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