Health Spending Down about $1 Trillion Thanks to Generics
Growing use of generic medicines has reduced U.S. health-care spending by more than $1 trillion over the past decade, according to an industry-funded study released Thursday.
The fourth annual report, produced for the Generic Pharmaceutical Association, found use of generic prescription drugs in the U.S. saved about $193 billion last year alone. That amount was up 22 percent from the $158 billion in savings from generics in 2010, and it was more than three times the $60 billion in savings in 2002, the report states.
The report notes that using inexpensive generic versions of pricier brand-name prescription drugs now saves the country about $1 billion every other day.
Last year, nearly 80 percent of the 4 billion prescriptions dispensed in this country were generic drugs. Because of their cheaper prices, those drugs accounted for just 27 percent of total U.S. spending on prescription medicines. In categories where both branded medicines and generic drugs are available, consumers opted to get the generic version 94 percent of the time last year, the report noted.
Use of generic drugs has been growing steadily in this country, fueled by patients and insurers looking to save money, since the copycat pills were first allowed under a 1984 law called the Hatch- Waxman Act. Once there are multiple generic versions of a brand- name drug available in pharmacies, the price for all those generics generally drops to 80 percent to 90 percent less than the brand- name price.