Prescribing generic drugs could have saved $73 billion

Prescribing generic drugs could have saved $73 billion
May 09 01:00 2016

The nation could have saved an estimated $73 billion from 2010 to 2012 if clinicians had more frequently prescribed alternatives to brand-name drugs, a JAMA Internal Medicine study finds. The total out-of pocket savings for patients would have been about $25 billion.

Researchers aimed to put a price tag on how much money could be saved overall and out-of-pocket through the use of generic drugs and “therapeutic substitutes.” The latter term describes prescription drugs for which no generic equivalent exists, but for which there is an equally effective alternative within the same drug class.

Drug costs have been a critical issue in recent years. Spending on prescription drugs increased 13% in 2014, reaching $373 billion, an issue that has drawn the attention of Congress and presidential hopefuls.

The anticipated approval of new specialty medications for chronic conditions like diabetes and asthma may further drive up spending, analysts say. The Institute for Clinical and Economic Review plans to release cost-effectiveness reports for a slate of therapies that are pending Food and Drug Administration approval this year.

In an effort to improve transparency, a coalition of organizations representing doctors, nurses, hospitals, insurers and consumers thinks drugmakers should be required to report their development costs, give annual reports on drug list prices and project federal spending before their drugs can be approved by the FDA.

The new JAMA Internal Medicine study is among the latest to focus on reducing costs by curbing the over-prescription of brand-name drugs. Many clinicians have been reluctant to engage in the practice, especially when it comes to prescribing therapeutic substitutes, over fears the drugs could result in worse clinical outcomes for patients. The study also points to another clear incentive to prescribe pricier drugs…

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