Are Generic Drugs Just As Good As Branded Drugs?

Whether it’s a regular prescription or an over-the-counter pain reliever, most people need medication from time to time.

However, while it’s incredibly useful and, in some cases, critical, medication can be very expensive. This is a significant problem for many Americans who struggle to pay for prescription medications.

This begs the question, are lower-cost generic drugs just as good as the branded drugs you’re familiar with?

We’ve looked at the differences between generic and brand-name drugs. Here’s what you need to know.

Generic versus branded drugs: what’s the difference?

All medicines have two different names. The first is the name of the active ingredient that plays a role in the body, also known as the generic form of the drug. The other is a brand name used by a pharmaceutical company to market a drug.

This means you might know a particular medicine by its brand name rather than its active ingredient name.

While the name may differ, the active ingredient itself doesn’t change between the brand-name drug and the generic version.

According to the US Food & Drug Administration (FDA), generic medication is developed to be the same as branded drugs. This means they share the following qualities:¹

• Dosage

• Safety

• Strength

• Administration

• Quality

• Intended use

• Performance

The organization states: 

“These similarities help to demonstrate bioequivalence, which means that a generic medicine works in the same way and provides the same clinical benefit as the brand-name medicine. In other words, you can take a generic medicine as an equal substitute for its brand-name counterpart.”

The FDA ensures that branded and generic drugs are equal

To ensure drug safety and consistency, the FDA ensures that all generic drugs are equal to their branded counterparts. This means the FDA ensures quality both before and during the manufacture of generic drugs.

To create a generic drug, the drug must meet the same efficacy standards and be just as effective as branded drugs.

Patents for new drugs must have already lapsed before a generic drug is brought to the market. This is usually 20 years after a brand-name drug has been developed. Once this occurs, generic versions can be developed and approved by the FDA for sale.

Manufacturers who wish to create a generic drug submit an application known as an abbreviated new drug application (ANDA), which outlines that the generic drug is the same as a branded drug on the market.

The FDA controls the quality of generic drugs through the Generic Drugs Program. They state:

“The FDA Generic Drugs Program conducts a rigorous review to ensure generic medicines meet these standards, in addition to conducting inspections of manufacturing plants and monitoring drug safety after the generic medicine has been approved and brought to market.”

The following standards must be met to satisfy the FDA:¹

• The active ingredient must be the same

• The active ingredient must be the same strength

• The medicine must last for the same amount of time 

• The administration must be the same

• The inactive ingredients do not need to be the same but must meet acceptability requirements

• The manufacturing process must operate within the same strict standards

• The label must be the same or similar

Minor differences in generic drugs

While the quality and performance of generic drugs are the same, you may notice some minor visual differences.

The FDA allows differences in the size, shape, and color of the drugs. These may occur due to trademarks held by pharmaceutical companies. This means both the packaging and the drug itself may look different.

Some subtle differences in absorption have also been found between generic and branded drugs.

In one research study, there were minor differences between generic and branded drugs when it came to absorption in the body.²

Generic drugs were absorbed more in some cases and less in others. The differences noted were only around 3.5% and are considered acceptable by the FDA.

A small amount of research has questioned the equivalence of generic drugs. A 2017 study found that patients who took generic blood pressure medications had higher rates of side effects.³

This appeared to suggest that the generic drugs may not be as safe, but researchers couldn’t pinpoint the cause. There may have been other factors at play, such as problems with the study or the actions of participants.

Unless further research suggests variations between drug quality, the current consensus is that generic drugs and branded drugs are equal in quality. This means you can assume you’re getting the same benefits with a generic drug as a brand-name drug.

$2 trillion in savings via generic drugs

Medicines can be incredibly expensive. The global pharmaceutical market totaled $1.42 trillion in 2021. Continual growth is expected.⁴

Medications can be cost-prohibitive for consumers. According to a survey by the Kaiser Family Foundation, 79% of people find medication prices unreasonable.⁵

Almost one in four Americans who take prescription drugs say it’s challenging to afford their medication.⁶

Generic drugs can create big savings for consumers and the entire healthcare system. The IQVIA found that in a ten-year period - 2009 to 2019 - the use of generic drugs saved the US healthcare system nearly $2 trillion.⁷

A 2015 report from the American College of Physicians called upon doctors to prescribe generic drugs where possible to save on costs. Those savings can help increase access to medicines.⁸

The Association of Accessible Medicines (AAM) stated in a report:

“...the future affordability of medicines for patients is inextricably linked to the success of the generic and biosimilar industry…. At $5.63, the average copay for a generic prescription is almost one-seventh of the average copay for a brand-name prescription. That means more money in the pockets of US patients.”⁷

Ultimately, it’s been found that generic drugs save US healthcare systems $313 billion per year.⁷

The average generic primary copay in 2019 was $6.97 versus an average primary copay for brand-name drugs of $56.32.⁹

Why are generic drugs much cheaper?

Drug development is not cheap. It can take more than a decade to conceive, research, test, and manufacture a drug to make it ready for sale.

New drugs must go through rigorous animal and human studies to ensure their safety and efficacy. However, because the safety of generic drugs has already been proven, these stages are not required.

The ANDA application allows generic drug manufacturers to avoid having to undertake clinical research already completed by the branded drug company, which shortens the process. This is a key reason for generic drugs being a lower-cost alternative. The significantly lower upfront costs allow generic drug manufacturers to sell their medications at a fraction of the cost.

Competition among generic medicine companies — if multiple applications have been granted — can help drive this cost down further.

Why does your medication not have a generic option?

While generic medications are very common, they are not available for every medication type. This may be because the branded company still holds a patent blocking other manufacturers from creating a generic version. Most of these patents last 20 years. Another reason could be that a generic version hasn’t yet been manufactured.

Choosing a generic option can have huge cost benefits, so it could be worth finding out if there is a generic alternative to your medications.

Here’s how to find out.

• Speak to your doctor — they will likely know if there’s a low-cost generic option for your medication, and they can advise if it’s appropriate for you.

• Ask your pharmacist — your pharmacist can also advise about generic drugs and the price differences between medications.

• Check the FDA Listing of Authorized Generics — this list details the different generic options, though it can be tricky to understand. Your doctor or pharmacist can help you with this.¹⁰

The pros and cons of brand-name drugs

When it comes to deciding whether to purchase the brand-name or generic drug, there are a range of factors to keep in mind and several pros and cons to consider.

The pros of brand-name drugs

• Brand-name drugs are the original drug and the first to market. They undergo rigorous animal and human trials to ensure their efficacy and safety. This process tends to take years. The specific version you purchase is the one that underwent rigorous testing, so you can be confident that the quality is high.

• Occasionally, the absorption rate of brand-name drugs is better. However, the difference has been found to be minimal and isn’t likely to affect the drug’s effectiveness.

• Brand-name drugs tend to have a distinct look and feel. This means you’re less likely to mix up your medications.

• Brand-name drugs tend to be better known and recognized. People may be hesitant about the word “generic” and be more loyal to brand names, which could improve medication adherence.

• Brand names may offer people peace of mind.

The cons of brand-name drugs

• Brand-name drugs are significantly more expensive than their generic counterparts. This puts pressure on both consumers and the US healthcare system as a whole.

• Generic drugs are the precise quality of brand-name drugs. They are FDA-approved but cost a fraction of the price.

• Health insurance companies are more likely to cover the cost of generic drugs than branded ones.

• Generic drugs give consumers much greater access to medication. Branded drugs are more exclusive and restrictive.

Which drug should you choose?

You should always speak to your doctor when it comes to making decisions about medication. Your doctor understands your personal health situation and is typically the best person to offer advice.

Your pharmacist can also provide information about medications, dosing, generic medicines, and price differences.

A branded drug may be more appropriate in some cases, but generic drugs offer a low-cost option with precisely the same active ingredient and safety parameters.

In many cases, you’ll be able to find generic options for the brand-name drugs you know at a fraction of the price.

Please remember that you should never stop taking or making changes to your medication without first consulting your doctor.

The lowdown

While we tend to know brand-name drugs better due to marketing campaigns, generic drugs appear to be just as effective.

• Brand-name drugs may take a decade or more to develop. They go through rigorous safety checks and trials.

• The FDA controls the release of generic drugs. These are the same as brand-name drugs already on the market.

• FDA-approved generic drugs must match the brand-name drug’s dosage, safety, strength, administration method, quality, intended use, and performance.

• Minor differences in appearance between brand-name and generic drugs are allowed. You might notice that a generic drug doesn’t look the same as a branded drug, but they will perform the same role in your body.

• Research shows there may be minor differences in absorption, but these are minimal and not cause for concern.

• According to the FDA, generic drugs are safe and the same as brand-name drugs.

• Generic drugs can be advantageous because they are significantly less expensive. This helps remove the burden on consumers and increases access to medications.

• The US healthcare system also benefits enormously from the use of generic drugs, having saved $2 trillion in ten years.

• Shorter applications allow generic drug manufacturers to avoid having to undertake clinical research already completed by the branded drug company. This is the main reason why generic drugs cost less.

• Patient hesitancy may be the largest barrier to the wider use of generic drugs.

• If you’d like to find a generic version of a drug you’re taking, your doctor and pharmacist are your go-to healthcare professionals for advice and guidance.

• Never alter your medications without first speaking to your doctor.

While it might feel familiar to purchase well-known brand-name drugs, choosing a generic option can save you significant costs in the long run without compromising on quality.

The information provided is designed to support, not replace, the relationship that exists between a patient/site visitor and his/her existing health care professional(s).”

Have feedback? Email content@healthmatch.io.

Sources:

1. Generic drugs: Questions & answers | US Food and Drug Administration

2. Comparing generic and innovator drugs: A review of 12 years of bioequivalence data from the United States Food and Drug Administration (2009)

3. Impact of the commercialization of three generic angiotensin II receptor blockers on adverse events in Quebec, Canada (2017)

4. Global pharmaceutical industry - statistics & facts | Statista

5. KFF health tracking poll – February 2019: Prescription drugs | Kaiser Family Foundation

6. Poll: Nearly 1 in 4 Americans taking prescription drugs say it’s difficult to afford their medicines, including larger shares among those with health issues, with low incomes and nearing medicare age | Kaiser Family Foundation

7. The case for competition 2019 generic drug & biosimilars access & savings in the U.S. report (2019 pdf - Association for Accessible Medicines)

8. Doctors should prescribe generic medications whenever possible rather than more expensive brand name drugs (2015)

9. 2020 generic drug & biosimilars access and savings in the U.S. report | Association for Accessible Medicines

10. FDA listing of authorized generics as of October 1, 2022 | Food & Drug Administration

Chloe Garnham is a writer exploring a broad range of topics, including healthcare, education, and technology.