US Pharm. 2011;36(6)(Generic Drug Review suppl):36-40. 

As our health care system struggles to establish control over escalating costs, one recognized method of price reduction--the use of generic medications--has increased and has led to some debate and criticism. The automatic substitution laws in community pharmacy, coupled with the increased generic therapeutic interchange within hospitals, has resulted in an overall boost in the use of generic drugs and, thus, has saved billions of dollars.1 Though substitution laws vary from state to state and range from automatic substitution to the requirement for physician's prior authorization or patient's consent prior to substitution, the use of generics has become an acceptable alternative to the exclusive use of brand-name medications.

“It is unknown whether the incentive to foster innovation of new drugs has been dampened by the push for generics; however, competition is generally good and can prompt the brand-name companies into being more creative and bringing innovative products to market,” said Keith Webber, PhD, acting director of the Office of Generic Drugs (OGD), part of the FDA's Center for Drug Evaluation and Research (CDER), when asked about the long-term potential for the use of generics and the loss of market exclusivity for trade-name medications. “The trend of generic medication use, however, has increased when one compares the percentage of prescriptions filled with generic drugs by the end of December 2000 (43%) in comparison to 75% of prescriptions filled by a generic drug through December of 2010. This represents nearly double the amount of generic drugs used in the health care system.” According to the OGD, the number of applications for generic drugs has plateaued over the past few years. 

Hatch-Waxman and Competition Concerns

The use of generic medications has spawned considerable debate in recent years. One discussion centers on the Hatch-Waxman Act, which, though it sought to lower drug costs for consumers by allowing generic drug manufacturers to challenge patents on brand-name medications, now appears to be responsible, at least in part, for the so-called “pay for delay” agreements between manufacturers of brand-name drugs and generic-drug manufacturers.

This agreement, in which the brand-name manufacturer pays the generic manufacturer to delay attempts to enter the market for an agreed-upon period of time, is profitable for both parties  since the brand-name manufacturer continues to enjoy market exclusivity and the generic manufacturer receives a large sum of money. Consumers, on the other hand, lose the opportunity to purchase less-expensive generic drugs. Since the price of a generic drug can save up to 85% of that of a brand-name drug, any delay to market of a generic costs the American consumer significantly.

At the same time, generic drugs come under criticism by patients for perceived inferior efficacy. Consumers also claim that mandated interchange is a fiscal strategy of insurance companies to reduce costs and increase profits. Other concerns raised recently question the ethical, if not legal, responsibility for generic manufacturers to update their package inserts with emerging safety information as it becomes known. Currently, such updates are not an FDA requirement. With regard to this concern, Dr. Webber notes, “The agency and courts are addressing the issue of incorporating warnings and precautions into both the generic and brand-name package labeling when events are discovered postapproval.”

In the case of new indications, brand-name companies must submit clinical studies to support the additional indication, and, once it is approved, they have 3 years of exclusivity in that additional indication. Generic companies would be legally prohibited from including that on their labeling until the expiration of the additional indication exclusivity. However, one could speculate that there would be no reliable way to enforce the new indication exclusivity, because documentation of specific indications is not currently required for prescriptions dispensed in the community pharmacy.

Substitution and Bioequivalence Issues

Other challenges include the selection of the appropriate drug product to interchange. Though many medication formulations may appear to be therapeutically equivalent, they are deemed “not equivalent” if they do not exhibit the same clinical effect and target serum concentrations.  Not all formulations of the same drug product are intended to be equivalent. In the case of Wellbutrin, for example, there are a variety of dosage formulations, all of which are not bioequivalent based on tablet release variables for the slow-release (SR) and extended-release (XL) tablet. The twice-daily SR formulation, launched by its manufacturer as the premier SR formulation of Wellbutrin, was based on a tablet matrix that differs in the rate of release as compared to the XL formulation that was released for once-daily dosing.

Slow-release products must demonstrate equivalency by a number of factors, but they do not need to share the same release mechanism or tablet matrix.  However, it is required that FDA approval be granted on equivalent serum concentrations so that the product exhibits the same pharmacokinetic behavior in all patients. Additionally, the pharmacokinetics of the generic and brand-name comparator products must also exhibit identical pharmaceutical characteristics in the same subject. “Dosage form patents don't stand in the way of bioequivalence,” said Dr. Webber. “Companies can use creativity to get around the patented release form if they can provide the same concentration. There is more than one way to perfect the science of formulation and release,” he stated. 

Quality and Efficacy Perceptions

While the fiscal advantage of using generic drugs is well known, there continues to be a lack of trust by patients in the community. Studies conducted to assess the public trust of generics have demonstrated this lack of confidence. One such study conducted by the Clinical Research Program of the American Diabetes Association surveyed almost 1,000 low- to middle- income patients with diabetes. Almost 70% of those patients felt the use of generics was merely a strategy used by the insurance company to save cost at the risk of compromising health. Further, roughly 30% of those respondents felt that brand-name drugs were safer and more effective than the generic alternatives.2

Another study conducted among American consumers of health care services found that 14% to 54% of respondents felt that generic drugs were less safe and effective than the brand-name product and that the degree of perceived risk increased with certain classes of drugs, such those affecting the central nervous system.3,4 The perceived risk was heightened as the severity of the health condition being treated increased; thus, patients with a heart condition were one group who felt significant increased health risk with generic interchanges.5 When asked about this lack of public trust, Dr. Webber noted that a common myth he wishes to dispel is that “generic drugs can differ up to 45% from their brand name counterpart. This myth results from a misunderstanding of the FDA's range of 80% to 125% for acceptable bioequivalence study data. This is a statistical range within which the bell-shaped curve of the bioequivalence must fit. Therefore, the mean of the bioequivalence data is never near the edge of this range.”

The FDA study evaluated 2,000 studies by manufacturers submitted with an NDA to demonstrate the equivalence and found only a roughly 3.5% difference by examining blood levels. The “quoted range” is designed for reference- listed drug variability seen from patient to patient. “There is a high degree of variability, and much individualization exists,” noted Dr. Webber. The FDA has stringent criteria and requires that in vivo serum concentrations of the two different drugs be tested in the same subject patient for complete assurance. “Consumer inquiries and reports of adverse effects are best channeled through Medwatch reports where the FDA compiles and compares these concerns through rigorous standards and related to products. When reporting, it is most helpful to include the name of the manufacturer, if possible.”

In the wake of accusations of bribery and falsification of records in the Dyazide scandal of 1989, when a generic company was accused of submitting the actual brand-name drug as the generic product, multiple layers of safety nets have been established. There are now safeguards in place to avoid any potential for dishonest manufacturers to submit false or failed studies. These safeguards include, but are not limited to, the two-tier standard, which requires satisfying the FDA with an on-site inspection where bioequivalence studies are conducted along with the submission of the raw data.

There are instances when companies don't make the 'approved list'--the data aren't adequate for the FDA to approve; however, this is fairly rare because bioequivalence study requirements are clear and manufacturers do not intentionally submit failed studies,” noted Dr. Webber. “Our agency works well with industry to have approvable applications submitted, and they will submit approvable studies with the belief they have met the required standards.” 

Getting Generics to Market

The process of getting a generic drug to market is complex and time sensitive, so the FDA cannot speculate about or publicize future generic drug releases until all the logistical requirements have been met. “The OGD staff's goal is to bring safe and effective generics to approval, but after approval, the timeline to get drugs to market must be pushed by the manufacturer,” said Dr. Webber. “There is an expiration of exclusivity if the product is not marketed within 75 days that creates an incentive for the company to continue the pursuit.”

Often, medications are not completely manufactured in the United States, and key active ingredients are required to be produced within FDA-approved international sites, which creates an additional hurdle for the manufacturer. Dr. Webber pointed out that “foreign sites see the biggest lag, and it is critical that the FDA has access to these sites to ensure acceptability. Importation from approved sites outside of the U.S. may include importation of just the active ingredient with the final product being manufactured here, or there is importation of the total final product from sites outside of the U.S. that are either from approved sources or unapproved sources. Unapproved sources have no FDA control, no oversight; therefore, importation of that generic or brand name product is illegal.”

Biosimilar biological products are biological prescription drugs that are demonstrated to be highly similar to, or interchangeable with, an FDA-approved biological product. The CDER is working on plans to issue guidance on biosimilars in 2011. In November 2010, The FDA held a 2-day public hearing for the purpose of seeking feedback on the identified challenges associated with the launch of the Biologics Price Competition and Innovation Act of 2009 (BPCI Act). The BPCI Act supports an abbreviated approval process for biological products that are demonstrated to be highly biosimilar to or are considered entirely interchangeable with an FDA-approved biological product. “Our agency is working to implement this statute; we are in favor of it,” Dr. Webber stated. 

Generics and User Fees

The Prescription Drug User Fee Act (PDUFA), enacted in 1992 and renewed in 1997 (PDUFA II) and 2002 (PDUFA III), authorizes the FDA to collect fees from companies that produce certain human drug and biological products. PDUFA includes three types of user fees: application fees, establishment fees, and product fees. Since the passage of PDUFA, user fees have played an important role in expediting the drug approval process.

The User Fee program allows the FDA to protect the public while enhancing potential innovation in drug manufacturing. The fees collected aid in the monitoring of drug products, medical devices, and additives. The FDA's oversight of User Fees results in its being responsible for the overall management of the program. When asked about user fees, Dr. Webber noted, “Our agency is just starting user fee negotiations. We recognize there is a need for user fees to support the regulation of generic drugs. The generics program is the only pharmaceutical regulatory group not supported by user fees; everyone else is. We seek a fair and comprehensive program with industry that augments all parts of the regulatory evaluation process. The current regulatory process ensures that generic medications are safe and effective; however, without user fees there will not be adequate resources to address the number of applications and production sites and there will be greater delays in bringing generic drugs to market in the future.” 

Conclusion

The issues of loss of market exclusivity in brand-name medications, impact of the Hatch-Waxman Act, substitution and bioequivalence, and perception by patients of generics' efficacy will all continue to drive the generic drug industry into the future. In addition, the generic medication regulatory environment overseen by the FDA will further shape the generic drug landscape, and the aging population in the U.S. will place increasing pressure on drug cost and availability.

REFERENCES

1. U.S. Food and Drug Administration. Generic drugs: questions and answers. www.fda.gov/Drugs/ ResourcesForYou/Consumers/QuestionsAnswers/ucm100100. htm. Accessed March 21, 2011.
2. Smolen, A. Medication therapy management: recommending generic drugs as cost-savings substitutes. US Pharm. 2010;35(6) (Generic Drug Review suppl):22-28.
3. Ganther J, Kreling D. Consumer perceptions of risk and required cost savings for generic prescription drugs. J Am Pharm Assoc. 2000;40:378-383.
4. Valles J, Barreiro M, Cereza G, et al. A prospective multicenter study of the effect of patient education on acceptability of generic prescribing in general practice. Health Policy. 2003;65:269-275.
5. Changing to a generic drug. www.bpac.org.nz/magazine/2007/
june/upfront.asp. Accessed March 21, 2011. 

To comment on this article, contact rdavidson@uspharmacist.com.