|
In this issue: • Generic Drugs • Arxcel Study • Seniors & Drugs Arxcel, Inc. 4390 Quinby Dr. Suite D Hamburg, NY 14075 (716) 646-9292 (716) 646-6985 Fax www.arxcel.com info@arxcel.com ARXCEL can help with: Plan Design Proposals Clinical Analysis Product Line Development Sales & Marketing |
| Winter 2002 |
|
GENERIC DRUGS
DRUGS COMING OFF PATENT
Generics will be very important this year. Three blockbuster drugs, Prilosec®, Glucophage®, and Claritin®, will be coming off patent in the near future. All three are in the top 20 of prescription drugs ranked by sales.1 It is difficult to pinpoint exactly when this will occur due to the ongoing litigation by the brand manufacturers. These three upcoming generics are:
- Prilosec (omeprazole) used in treatment of gastrointestinal disorders
- Glucophage (metformin) used for management of type II diabetes
- Claritin (loratadine) used in management of allergic rhinitis
A drug is considered generic when the original patent of the brand name drug expires and it is allowed to be manufactured and sold under the chemical name. Once the brand patent expires, it can be marketed by other manufactures with Food and Drug Administration (FDA) approval. The brand patent lasts 20 years from the time of discovery. The major difference between a brand and generic is that the brand manufacturer must perform the research and development necessary for the development of the drug.
ARE GENERIC DRUGS SAFE?
The FDA is responsible for maintaining the safety of generic drugs. They scrutinize the manufacturers of generic drugs to ensure that the data collected is valid and that their facilities are within the standards set forth for sterility and purity. The inspections include a review of records, some batches of the drug, production facilities, as well as labeling and storage.
The generic manufactures' version of the drug must have the same active ingredient as the brand name drug. Manufactures must prove that the generic product will supply the same amount of the active ingredient in the body at the same rate as the brand drug. This rate of absorption is a significant factor to the FDA. Generics are rated on this factor by a two letter code, AA, AB, BB, etc. AA has essentially the same absorption rate as the brand. AB (most generics are AB rated) has some differences that have been resolved to the satisfaction of the FDA. BB rated generics do not have the same bioavailability and should not be used interchangeably.
GENERIC DRUGS TO BE MORE WIDELY ADVERTISED
It will not be long before consumers begin to see advertisements for generic drugs. The FDA is planning a public awareness campaign about the safety and efficacy of generic drugs. In addition, Blue Cross and Blue Shield of Michigan plans to conduct their own generic drug campaign to coincide with the upcoming patent expirations.
GENERIC PLAN DESIGN RECOMMENDATIONS
To take advantage of the lower pricing offered by generics, programs should adopt a Mandatory Generic Provision that states:
If a member chooses to have a brand name drug dispensed when a generic alternative is available, they must pay the brand copayment plus the difference in the price of the drug.
ARXCEL TO CONDUCT STUDY
Arxcel has contracted an independent research firm to survey leading executives in pharmacy benefit industry. The study will evaluate opinions of managed care executives, third-party administrators and employers regarding the current state of and future trends in the prescription drug industry.
A number of national media outlets have shown interest in the study and its potential for providing highly valuable data about prescription drug benefits to both industry audiences and the national public. The study will determine respondents' viewpoints regarding such issues as the rising cost of pharmaceutical benefits, solutions for the cost increases and viability of the solutions available. The costs involved in managing prescription drug benefits have continued to rise, and Arxcel has underwritten this study to assist our clients in their prescription benefit decision making.
GOVERNMENT NEWS
Seniors Back On Agenda
Adding a prescription drug benefit is back on the Congressional agenda this year.2 Many plans and proposals were set aside after the September 11th tragedies, but Congress plans on including a Senior Drug Benefit to their list when their return in late January. When previous proposals were developed, the government had predicted surpluses. Now the proposals will have to be reevaluated to meet the needs of the country and the Seniors.
Anthrax Vaccine Production Closer
On December 19th, 2001, the FDA completed their pre-approval process of the only American manufacturer of the Anthrax vaccine, Bioport, in Lansing, Michigan.3 Based upon that inspection, another follow-up inspection, and approval of their distributor, Hollister-Stier, the anthrax vaccine would be made available.
1 "Prescription Drug Trends - A Chartbook Update", Kaiser Family Foundation, November 2001
2 "Associated Press", Monday, December 13, 2001.
3 "FDA, Press Office Statement", December 19, 2001.
© Arxcel, Inc.
