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Truth About Generics

What You Must Know

India is known as the 'pharmacy of the developing world', with 25 per cent of the world's generic drugs in terms of volume being produced by the country1. Medicines produced by generic companies in India are among the most affordable. Our pharmaceutical industry is a major source of generic medicines worldwide. Despite their widespread use, misapprehensions about generics remain. In the following Q&A we have tried to compile some answers from authoritative sources:

Q: What are Generic Drugs?

Generic drugs are essentially an exact chemical replica of their branded counterparts and they function within the body in the same way as a branded drug would. Alternatively, they can be described as a bioequivalent version of the original drug, identical in dosage, form, safety, strength, route of administration, quality, performance characteristics and intended use. The generic versions of drugs become available after the expiration of the patent of the original drug.

Q: Why do Generic Drugs Cost Less?

When a company develops a new drug, they are granted a patent for exclusive use of the same. But after the expiration of the patent other drug manufacturers can also produce the same drug at lower prices because they didn't invest the same amount of money for research & development as the original company would have and thereby they don't have to recover those costs.

Q: Are Generic Drugs Always Cheaper?

Usually. In the United States, however, when a generic drug is first approved and marketed, costs may remain high (although less than the brand name drug) for six months because the Food and Drug Administration (FDA) will give the first generic manufacturer a “180-day exclusivity period”. It is assigned to the generic manufacturer who is the first to file an Abbreviated New Drug Application (ANDA)2 and has done the additional work to get the generic drug to the market. This exclusivity allows the company to be the first - and possibly only - generic on the market for six months. In India, even with high profit margins for some branded generics, they are usually cheaper than the original branded medicines.

Q: Are Generic Drugs as Safe as Brand Name Drugs?

Yes. All drug manufacturers have to conform to the Schedule M, Good Manufacturing Practices, prescribed under the Drugs and Cosmetics Act, 1940. Any drug that fails to meet the specified criterion is recognised as spurious and is prevented from being sold in the market.

Q: Does Every Brand-Name Drug have a Generic Equivalent?

No. New drugs are developed under patent protection, and most drug patents are protected for 20 years. Multiple companies can manufacture and sell generic versions of the brand-name product. However, some drugs may never have a generic because manufacturers may deem these products unprofitable or too difficult to manufacture. 

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Q: Why do Generic and Brand-Name Drugs Look Different?

Often trademark laws do not allow generic drugs to look exactly like the brand-name drug. However, the generic drug must have the same active ingredients. Colors, flavors, and certain other inactive ingredients may be different, but the effectiveness of the drug remains the same. Also, the same generic drug, made by a different manufacturer, can look different too.3

Q: Do Generics Lead to a Fall in Brand Prices?

Yes, once these generics are allowed, then automatically the price of the branded drugs also reduces because there is an increased competition.

Q: What is a Branded Generic?

Branded generics are just like they sound - generic drugs that have a brand name and a generic molecule. These drugs are developed, either by a generic drug company or the original manufacturer after the patent expires for the original product. This product must be bioequivalent to the innovator and must be physically, chemically, and biologically stable.The branded generic name is proprietary to (owned by) the company.

IMS Health4 defines a branded generic as: ? Prescription products that are either novel dosage forms of off-patent products produced by a manufacturer that is not the originator of the molecule, or ? A molecule copy of an off-patent product with a trade name.5

Q: Can You Give Some Examples of Branded Generics?

Asprin tablet is a generic and Disprin tablet is branded generic.

Q: Are Branded Generics More Expensive than the Generic?

Branded generics are not always as affordable as a true generic. By sporting a brand name, some consumers may incorrectly assume that the branded generic is a higher quality product than a true generic, but that is not usually the case. While there is some evidence to suggest extremely high profit margins of branded generics, yet they are almost always less expensive than the original branded medicine.6 In addition, multiple versions of a branded generic may be available, causing differences in the prices of different branded generics.

Q: What is the Difference in Price of Generic Drugs and Branded Drugs?

One of the main reasons for advocating generic drugs by the government was due to the significant price difference between generic and branded drugs. According to a report published in 2010, some price differences in some of the popular drugs under their generic names and branded names were as follows:

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Painkiller

  • Generic drug paracetamol: Price  2.45; Branded drug Crocin:  11, Calpol:  10 .70
  • Generic paracetamol syrup:  9.00; Branded Crocin syrup:  15.00
  • Generic diclofenac sodium + paracetamol:  4.4; Branded Diclogesic:  19.40

Antibiotic

  • Generic Amoxycilin:  13.2; Branded LMX:  40, Remox:  38.7
  • Generic Azithromycin:  41.8; Branded Azee:  107, Azithral  128.55
  • Generic folic acid:  2.8; Branded Folivite:  11.8
  • Generic B-complex:  1.8; Branded Becosul :  11.07

Cancer Drug

In the case of brain tumours, the current cost of treatment using Temozolomide is 2.16 lakh for the innovator brand and 20,000 for its generic variants.

Again, for Irinotecan, which is used in treating a range of cancers including those in the lungs and ovaries, the cost ranges from 1.87 lakh for innovator brands to 25,000 for the generic ones.8 These are just a few examples indicating differences in prices of generic and branded drugs.

Q: How are Generic Drugs Approved?

The Drug Controller General of India (DGCI), under the gamut of Central Drugs Standard Control Organisation (CDSCO) is responsible for the approval of all the drugs, including generic. All drugs are subject to identical statutory requirements, inspections and approvals.

Q: Why should Preference be on Generic Drugs?

One prime reason to popularise generic drugs is to make drugs and medicines affordable for people who cannot otherwise afford the expensive branded medicines and the private hospitals. India has a significantly higher out-of-pocket expenditure by households on health than several other developed and developing countries, with health expenditure causing a major brunt in the household budget.9 Another reason for the use of generic drugs is to reduce the unethical practices of doctors who deliberately prescribe branded drugs over generic drugs. This could be due to incentives or kickbacks from the pharmaceutical companies. The use of generic drugs will reduce the rising cost on healthcare.10

Q: Do Generic Drugs Take Longer to Work in the Body?

No. Generic drugs work in the same way as brand name drugs.

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Q: What are the Advantages of Using Generic Drugs?

The biggest advantage is the price. You can save as much as 90 per cent over the cost of brand-name medications. Generics cost on an average 40 to 60 per cent less than brand-name drugs. That's a real plus for older adults on a fixed income who take numerous medications.

Q: Do Hospitals and Doctors Support Use of Generic Drugs?

Unfortunately, no. Within the US generic drugs account for 88 per cent in terms of dispensed retail prescriptions, according to a 2015 report. The position is similar in a number of European countries. In India, however, the share of generics is merely 8 per cent of the 80,000 crore domestic pharmaceutical market.11

Q: Is a Generic Medicine Right For Me and Can I Ask My Doctor To Prescribe Them?

In most cases the answer is yes, but you should always discuss changes in your medication with your doctor or pharmacist first. This includes making sure that you do not have an allergy to any of the inactive ingredients in the generic medicine.12 The Medical Council of India (MCI) has stipulated that doctors will face action if they fail to adhere to its guideline on prescribing the drugs only in generic names and writing prescriptions legibly.13

Q. In India Why aren't Generic Drugs Prescribed Even Though They are Cheaper and Effective?

There is a lack of awareness among people about generic drugs. Generic drugs have the same chemical composition as branded drugs, but because they are sold under their chemical names, the general public is not familiar with these. For example, for popular branded drugs like Crocin and Calpol, their generic name is Paracetamol. Even doctors are more sure about the availability of the branded drugs rather than the generic ones as there is no advertising and marketing of generic drugs in India.14 Another reason is that the branded pharmaceutical companies spend enormous amounts on marketing. Their medical representatives bribe doctors with commission on prescription of their products. Hence, the pharma companies brainwash the people with continuous marketing of their branded medicines. The only way to stop this is to educate the people about generic drugs.

Q. How can I Get a Generic Medicine?

Easy — just ask your doctor to write your prescription using the medicine's active ingredient, or, unless your doctor has said that substitution is not permitted, ask your pharmacist to dispense the generic version. The Jan Aushadhi programme is an initiative of the government to provide essential medicines at reasonable rates at specially established shops.15

Q. Where are Generic Drugs Available?

Generic drugs should be available in almost all chemist shops, but they often do not keep a stock of all generic medicines. To buy a generic medicine, the patient has to ask for generic version of a branded drug.  It is the responsibility of the Department of Pharmaceuticals of the government for promoting generic drugs. But sadly, promotion and marketing have not been done properly or have not been done at all.

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Q. What is Jan Aushadhi (JAS) Programme?

To promote affordable drugs, the government had in 2008 set up a scheme called Jan Aushadhi, whose objective was to open generic drug stores around the country.16 The Department of Pharmaceuticals has in 2017 launched a campaign called 'Pradhan Mantri Bharatiya Janaushadhi Pariyojana' to provide quality medicines at affordable prices to the masses through special kendras known as Pradhan Mantri Bharatiya Jan Aushadhi Kendra (PMBJK). These provide generic drugs, at lesser prices but equivalent in quality and efficacy as expensive branded drugs.17 In a recent development, the railway minister has announced the opening of Jan Aushadhi stores at railway stations, dispensaries, workshops and on rail premises.18

Q.How Many PMBJKs Have Been Opened and What Are Their Locations?

More than 850 PMBJKs are presently functional and spread over 28 States/UTs. List of state-wise/district-wise JAS along with their locations are available under the heading “PMBJK” of the website of Jan Aushadhi.

Q.What are the Medicines Available at PMBJKs and Their Prices?

The endeavor of Bureau of Pharma Public Sector undertakings of India (BPPI) is to make available all therapeutic medicines at the PMBJKs. A list of medicines with their MRPs which are presently available are given under the heading “Price List of PMBJP medicines” on the website: janaushadhi.gov.in. More medicines are being added to this list.19

Q. What Exactly Has Prime Minister Narendra Modi said on Generic Drugs?

Speaking in Surat on April 17, Modi referred to the Pradhan Mantri Bharatiya Janaushadhi Pariyojana (PMBJP), which aims to provide cheaper medical drugs to the people. “In the coming days, the government will bring a legal framework under which doctors will have to prescribe generic medicines which are cheaper than equivalent branded drugs, to patients,” the Prime Minister said. “…If a doctor writes a prescription, he has to write in it that it will be enough for patients to buy a generic medicine, and he need not buy any other medicine,” he added.

Q. Is This a Completely New Intervention?

Not exactly. After seeking approval from the central government, the Medical Council of India — which registers doctors to ensure proper standards of medical practice in the country — had on September 21, last year, notified an amendment in Clause 1.5 of the Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002. This clause now reads: “Every physician should prescribe drugs with generic names legibly and preferably in capital letters and he/she shall ensure that there is a rational prescription and use of drugs”. The words “legibly and preferably in capital letters” were not there originally. Also, the UPA government had from time to time, issued circulars and instructions to government hospitals and Central Government Health Scheme (CGHS) dispensaries to “prescribe generic medicines” to the “maximum extent possible”.20

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Q. Have There Been Recent Initiatives in Making Cancer and Other Drugs Cheaper?

Yes, in March 2017, the drug pricing regulator National Pharmaceutical Pricing Authority (NPPA) has slashed the prices of some cancer drugs by up to 86 per cent.The price of a drug called Iressa,

which is manufactured by Astrazeneca Pharma India Limited and is used for the treatment of lung cancer, was around 29,259, which has now been slashed to 3,977. The price of another expensive drug for targeted cancer therapy Biceltis, manufactured by Emcure Pharmaceuticals, which is an antibody used to target cancer cells, has been reduced by over 10,000.

Price of chemotherapy drugs like Doceaqualip, manufactured by Intas Pharmaceuticals Ltd, has been reduced by 37 per cent – from 16,890 to 10,560. Bhupendra Singh, chairman of NPPA said that more cancer drugs will soon come under price control. The price of Dr Reddy's tablet Levin used to treat blood cancer has been cut by 25 per cent. “Apart from cancer, important medicines used in the treatment of diabetes, bacterial infections and blood pressure have been capped by the government, thereby reducing the cost by an average of around 25 to 50 per cent,” he said. Since March 2016, prices of around 800 drugs have been slashed by the government.21

Q. Is There an Ugly Side to the Manufacture of Generic Medicines in India?

Yes. Though India is now placed fourth in the global generics market, it leads the race in the global burden of counterfeit medicines. At least 75 per cent of all such drugs traces its roots to India, followed not very closely by Egypt (7%) and China (6%). The greed for cashing in on the foreign developed markets has resulted in reputed Indian pharma giants like Ranbaxy, GVK Biohealthcare, Dr. Reddy's Laboratories being proven guilty of submitting fabricated BA/BE (Bioavailability/Bioequivalence) studies to push generics into the international markets. They pleaded guilty in the courts and had to give millions of dollars in settlements. Currently, only 0.01 per cent of the drugs in the Indian market are even tested. Some of the generics are not even tested on basic effectiveness, so they don't even have to put in an active ingredient, which gives retailers sometimes 1,000 per cent profit margins. Due to such lax rules and regulations, substandard, contaminated and sometimes toxic drugs end up even in government generic medicine supplies.22

Q. What Steps Have the Successive Governments Taken in This Matter?

The government in April 2017 has enacted amendments to the Drug and Cosmetics Act, 1940, making it mandatory for manufacturers to submit BE/BA reports for approval of generic medicines into the market. The earlier regime only required BE/BA reports for generics of those patented drugs approved by the Drug Controller General of India (DCGI) within the first four years of introduction of the original drug. Beyond that no generics manufacturers are required to submit any BE/BA reports to sell their drugs in the markets. Only the finished drugs are sometimes submitted for testing at the Central Drugs Standard Control Organisation (CDSCO) and there is no regulation for ensuring good manufacturing practices presently.23

Q. What is 'Evergreening'?

Through this mechanism the companies continue to retain their dominant market position by obtaining multiple secondary patents, often by making inconsequential modifications to the original product. Companies as a result are able to protect their product for decades, preventing production of cheaper generic replicas.


  1. http://www.pharmabiz.com/NewsDetails.aspx?aid=94600&sid=9
  2. ANDA contains data which when submitted to FDA's Center for Drug Evaluation and Research, Office of Generic Drugs, provides for the review and ultimate approval of a generic drug product. Once approved, an applicant may manufacture and market the generic drug product to provide a safe, effective, low cost alternative to the American public.
  3. https://www.drugs.com/generic_drugs.html 
  4. IMS Health is an American company that provides information, services and technology for the healthcare industry. It is the largest vendor of U.S. physician prescribing data; https://en.wikipedia.org/wiki/IMS_Health
  5. https://www.drugs.com/generic_drugs.html
  6. http://economictimes.indiatimes.com/industry/healthcare/biotech/pharmaceuticals/retail-margin-on-generic-drugs-may-be-as-high-as-1000-claims-study/articleshow/58252850.cms
  7. http://www.mapsofindia.com/my-india/society/generic-drugs-in-india-more-awareness-required
  8. http://indianexpress.com/article/india/india-others/12-cancer-drugs-may-come-under-price-control/
  9. http://www.mapsofindia.com/my-india/society/generic-drugs-in-india-more-awareness-required
  10. http://pharmaleaders.tv/the-branded-generics-market/
  11. http://www1.apotex.com/au/products/generic-medicines-faqs
  12. http://timesofindia.indiatimes.com/india/doctors-to-face-action-unless-they-only-prescribe-generic-drugs-mci/articleshow/58314973.cms#
  13. http://www.mapsofindia.com/my-india/society/generic-drugs-in-india-more-awareness-required
  14. http://www1.apotex.com/au/products/generic-medicines-faqs
  15. http://www.mapsofindia.com/my-india/society/generic-drugs-in-india-more-awareness-required
  16. http://janaushadhi.gov.in/faq.html
  17. http://www.newindianexpress.com/nation/2017/jun/13/janaushadhi-outlets-on-railway-stations-hospitals-soon-1616247.html
  18. http://janaushadhi.gov.in/faq.html
  19. http://indianexpress.com/article/explained/cheap-generic-vs-costly-branded-issues-in-picking-right-drug-in-india-4620165/
  20. http://mumbaimirror.indiatimes.com/mumbai/other/prices-of-cancer-drugs-slashed-by-up-to-86/articleshow/57487124.cms
  21. http://www.firstpost.com/india/why-branded-drugs-cost-way-more-than-their-generic-counterparts-3412922.html
  22. http://www.firstpost.com/india/why-branded-drugs-cost-way-more-than-their-generic-counterparts-3412922.htm
  23. Supreme Court of India, http://supremecourtofindia.nic.in/outtoday/patent.pdf, accessed on 10 March 2016
  24. http://economictimes.indiatimes.com/news/politics-and-nation/india-has-right-to-grant-compulsory-licences-under-wto-government/articleshow/51517108.cms
  25. http://www.ictsd.org/bridges-news/bridges/news/india-grants-first-compulsory-license-to-generic-drug-producer
  26. https://www.ncbi.nlm.nih.gov/pubmed/19450118
  27. Value of Generic Medicines; Study Report for the European Generic Medicines Association Berlin, 5 October 2015 http://www.progenerika.de/wp-content/uploads/2015/11/IGES-Study-Report_Value-of-Generics_Oktober-2015.pdf

     

Volume: XXXVI No. 2
April June 2017