Top 3 Things You’ll Learn
- The number of generic drugs approved by the U.S. Food & Drug Administration in 2019
- Generic drug availability and increased competition among manufacturers decreases Rx costs
- How these first-time generic drug options could impact employer-sponsored pharmacy benefits
The ongoing quest to find affordable access to prescription medications is a pressing issue that has sparked frustration among consumers over the lack of favorable solutions.
While there is no one solution to the complex issue of high drug costs, the Food and Drug Administration (FDA) is making moves to lower costs through generic drug approvals. The FDA does not regulate drug prices, and instead is using its power to approve more generic drugs. Their success can be seen in the record-number of approvals, with 1,171 generics in fiscal 2019.
The FDA approved 125 first-time generic drugs & 1,000 additional generic options in 2019. More generics = more competition + lower Rx costs.
This number includes 125 first-time generic approvals, meaning that more than 1,000 drugs were approved as additional generic options. When more generics are available for the same brand drugs, competition for market share among drug manufacturers increases, and costs decrease.
Among the latest round of first-time generics are an opioid overdose drug, and medications to treat breast cancer and pulmonary arterial hypertension. These first-time generic drugs will compete in the market against high-cost brand-name medications that no longer have patent protection.
As we head into 2020, we may begin to see the impact of these new lower-cost medications as they hit the market. Time will tell what the overall spending impact will be for employer-sponsored pharmacy benefit plans, as it takes a full year of a new drug on the market to see savings. Our clinical team is poised to support you in determining how best to leverage the new generics and determine what the savings will be for your self-funded employer clients and their members.
Download our Clinical Strategies Playbook to find out how new drugs to market are impacting pharmacy benefit costs for self-funded employers.