The generic drug wars: deeply discounted medication

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The generic drug wars: deeply discounted medication

Generics/Research | Posted 31/01/2011 0 Post your comment

Fierce competition among major pharmacy chains in the US, such as CVS, Walgreens and Walmart, has led to a generic prescription pricing war with unclear public health implications.

Each of these chains offers a 1- or 3-month supply of specific medications for less than US$10.

Introduced in 2006, currently seven of the 10 largest pharmacy chains advertise a version of a deeply discounted medication (DDM) programme, accounting for more than 25,000 locations nationally. By early 2008, almost 70 million Americans had used these programmes.

Although DDM programmes lower drug costs for many patients, many issues surround them. These include that DDM formularies may include potentially ineffective or harmful medications, have the potential to influence physician prescribing behaviour, and may impair pharmacists’ ability to review complete drug-dispensing records.

Clinical impact

A key advantage of the DDM programmes is lower medication costs for patients. For many Americans, the availability of low-cost generic medications reduces cost barriers to obtaining medication and may improve compliance.

Cost-benefits, however, may be offset by the potential of DDM programmes to affect the drug selection process by influencing drug choice toward DDM formulary medications. Reports suggest that some patients presenting DDM formulary lists to physicians and hospitals may use the lists to prescribe discharge medication.

However, although discounting programmes may affect consumer price expectations, little evidence exists that the short-term effects on category choice, category incidence and purchase quantity persist over the long term.

Economic impact

It is thought that these DDM programmes, as loss-making programmes, could drive out independent pharmacists. For example, while DDM programmes typically charge patients US$4–5 per 30-day supply of medication, the average national cost of dispensing per prescription is US$10.5.

Conclusion

Recent research suggests that in the end, the benefits of increased access to medications may outweigh any potential downsides of DDM programmes [1]. However, DDMs are widespread and have the potential for unintended consequences on patients, providers and the healthcare system. Czechowski et al. therefore recommend a systematic review of DDMs in order to evaluate the clinical and economic implications of such programmes.

Reference

1. Czechowski JL, Tjia J, Triller DM. Deeply discounted medications: Implications of generic prescription drug wars. J Am Pharm Assoc. 2010;50(6):752-7.