Last Updated: January 18, 2022
Nine out of 10 prescriptions filled in the United States are generic drugs. And there’s a good reason for that statistic. On average, generic drugs cost about 80 to 85% less than brand name drugs.
So, if a brand name drug costs $100, its generic equivalent may only cost $15 to $20. Over the last decade, this difference in drug costs saved the U.S. healthcare system nearly $2.2 trillion. This includes a savings of $313 billion in 2019 alone, with $96.1 billion in Medicare and $48.5 billion in Medicaid savings.
Over the last decade, this difference in drug costs saved the U.S. healthcare system nearly $2.2 trillion. This includes a savings of $313 billion in 2019 alone, with $96.1 billion in Medicare and $48.5 billion in Medicaid savings.
When you consider buying generic vs. branded drugs, you may ask why the generic version is so much cheaper. You may hesitate to use them thinking “you get what you pay for.” While that holds true for many products, it’s just not so for generic drugs. Here’s what you need to know about generic drugs and the drugs coming off patent in 2022 that may save you money.
Generic drugs are the same as brand-name drugs in the ways that matter.
When the U.S. Food and Drug Administration (FDA) approves a generic drug, it is a copy of the brand in the ways that matter—dosage, safety, strength, quality, purity, the way it works, and the way you take it. A generic drug may look different, taste different, or have different inactive ingredients than a brand-name drug. But this is mainly due to trademark laws. Generic manufacturers’ factories meet the same rigorous FDA standards as the brands’ factories.
There’s a good reason why generic drugs are less expensive.
Generic drug costs are much less than brand-name drug costs because their manufacturers don’t have to pay for development and new drug marketing. The brand-name manufacturer does all the research and development work. They get a 20-year patent protection in return. Once the patent-protection term is up, generic equivalent drugs can be made available.
You don’t always have to wait long for a generic.
Interestingly, in most cases, the brand-name drug doesn’t come to market until it’s well into its 20-year patent term. So, consumers don’t usually have to wait a full 20 years for patents to expire and generic manufacturers to bring products to the market.
A variety of anticipated brand-name patented drugs are going generic in 2022.
Many of the drugs potentially going generic in the coming year treat various forms of cancer. This includes blood cancers, breast cancer, lung cancer, and others. Chemotherapy and targeted therapy drugs can cost a lot, in the thousands of dollars. Insurance companies and Medicare generally cover cancer drugs. But even paying a percentage of this cost can be financially challenging for many patients. The availability of generics can help ease this burden.
There are also some blockbusters on the list of potential generics for 2022. Notably, the diabetes drug, Januvia, and the blood thinner, Pradaxa. Other commonly used drugs include: Combigan, Dexilant, Dulera, Spiriva Respitmat, Viibryd, and Vimpat. Stay tuned to see if their patents get extensions.
Be sure to check with your pharmacist about off-patent drugs and new generic drug availability. While these drugs are nearing the end of their patent term, the release of generics may be delayed due to litigation, acquisitions, or other exclusivities. This explains why some expected generics from previous years can still be in the works.
