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Dispelling the Myth: Generics Are Not Always Low Cost

MedImpact Helps Plans Save $30 Million in High-Cost Generic Spend

 

5 Facts About Rising High-Cost Generics

  1. Generic drugs are not always inexpensive. While the costs of most generic drugs remains stable, approximately 2% of generics have increased by more than 1000%1 , drawing the attention of media, lawmakers, the FDA and the U.S. Department of Justice2.
  1. While the 2017 national average generic list price was $25, a wide disparity in drug prices exists. And the proportion of generic drugs with extraordinary price increases is growing.3
  2. In fact, researchers have found that amongst commonly used generic antibiotics 14% sustained large price increases of 90% or more.4
  3. Causes of rising generic costs are multifactorial — lack of competition, market manufacturer consolidation, closed distribution systems, stringent manufacturing standards, raw material shortages, and FDA backlog.5
  4. The Department of Justice and 45 states are claiming that generic drug prices are fixed and the alleged collusion may have cost U.S. businesses and consumers more than $1 billion.6 Congress initiated investigations of these price increases. And the Department of Justice issued subpoenas to some generic drug companies executives as part of an investigation into possible violations of anti-trust laws.

Case Study: Delivering Millions in Savings

From a large hospital system to a small self-insured employer, learn how five MedImpact plans lowered overall drug spend by shifting members from high-cost generics to lower cost, clinically relevant alternatives — while minimizing member and provider disruption.

MedImpact’s HCG Choice program delivered significant savings for all five plans — ranging from $1.30 to $4.33 PMPM savings. Our HCG Program collectively has saved our clients more than $30 million off their high-cost generic spend since 2015. Furthermore, members who switched from high-cost generic drugs to alternatives also benefited from savings — providing better value for all.

Download the full case study here to learn how we can help you lower costs with minimal member disruption.


1.MarketWatch. Why Drug Prices Remain Insanely High and 6 Things You Can Do To Save: www.marketwatch.com/story/six-tips-for-fighting-rising-prescription-drug-costs-2015-09-15
2.JAMA. The High Cost of Prescription Drugs in the US: Origins & Prospects for Reform: https://jamanetwork.com/journals/jama/fullarticle/2545691
3.IQVIA. Medicine Use and Spending in the U.S., A Review of 2017 and Outlook to 2022. April 2018 https://www.cdc.gov/drugoverdose/epidemic/index.html
4.Alpern JD et al. Trends in Pricing and Generic Competition Within the Oral Antibiotic Drug Market in the United States. Clin Infect. Dis. 2017;65(11):1848-52.
5.Academy of Managed Care & Specialty Pharmacy: “High-cost generic programs decrease drug spend in 5 plans” www.managedhealthcareexecutive.com/business-strategy/high-cost-generic-programs-decrease-drug-spend-5-plans
6.NPR. Probe Into Generic Drug Price Fixing Set To Widen; March 2018. 7. New England Journal of Medicine: High-Cost Generic Drugs — Implications for Patients & Policymakers. www.nejm.org/doi/pdf/10.1056/NEJMp1408376

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