Generic vs. Brand-Name Drugs: What's the Difference?

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In 2017, pharmacies in the United States filled over four billion prescriptions. Of those prescriptions, nine out of every 10 were for generic medications. Generic drugs are developed to provide the same benefits as existing brand-name medications. They match brand-name drugs in several characteristics, including dosage form, strength, safety, and performance characteristics. So, what's the difference when it comes to generic vs. brand-name drugs?

The Drug Development Process

It's not easy to bring a new medication to market. In most cases, several steps must be completed before patients have access to a new drug, and many of these steps take years to complete.

First, pharmaceutical companies discover, research, and develop new compounds in laboratory settings. Scientists evaluate thousands of compounds to see which may provide therapeutic benefits. After early rounds of testing, only a few of these compounds are flagged for further study.

Those compounds that may be beneficial for humans undergo both laboratory and animal testing to evaluate their therapeutic effects and safety. Drugs only move into human clinical trials if they're determined to be safe and effective. When clinical trial research is completed, the pharmaceutical company producing the drug submits it for United States Food and Drug Administration (FDA) review. If the new medication is approved, the FDA monitors it to ensure its continued safety.

The process is the same for both generic and brand-name drugs, with one notable exception: generic drugs don't have to undergo the strict animal and human clinical trials that brand-name medications do. This is because generic drugs are effectively the same as their brand-name counterparts. A brand-name drug and its generic equivalent have the same active ingredient, strength, effectiveness, safety profile, quality, and therapeutic benefits.

Generic vs. Brand-Name Drugs

In order to be marketed to the public, generic drugs must pass the FDA's review process just like brand-name drugs. However, generic drugs duplicate the high quality of their brand-name counterparts because they use the same active ingredients. Active ingredients are what produce therapeutic benefits for patients.

There are some allowable differences between generic and brand-name medications. Generic drugs may be different in color, size, or shape because those factors have no impact on how the active ingredient works. Also, because generic drugs don't undergo animal or human testing, they typically cost about 85 percent less than brand-name medications.

But in order for a generic medication to be marketed to the public, the patent on the brand-name must be expired. Some pharmaceutical companies also retain periods of exclusivity for marketing brand-name drugs, which prevents other manufacturers from marketing the generic drug option.

What Will Your Insurance Pay For?

Your insurance provider has a list, or formulary, of medications it will pay for. In the formulary itself, drugs are often divided into two categories: preferred and nonpreferred. If a drug is listed as preferred, it means your insurance company would rather you receive that medication instead of another. You'll also usually pay far less for these medications. Nonpreferred drugs carry higher coinsurance or deductibles.

Many generic medications are on preferred drug lists, but you should check with your insurance company to verify whether your prescription is covered.

Questions for Your Doctor

You may still be concerned about switching from a brand-name drug to a generic medication. That's why it's important to have a conversation with your doctor about the risks and benefits of changing your prescription. You might ask your doctor:

• Should I look out for any different side effects?
• Should I take the generic medication at the same time or in the same way as the brand-name drug?
• How will I know the generic drug is working?
• Will I feel different when I start taking the generic medication?

Generic drugs offer more treatment options compared to brand-name medications alone. Because they're evaluated the same way as brand-name drugs, they offer the same safety, effectiveness, and therapeutic benefits as their brand-name counterparts. If you still have questions about taking generic medications, a conversation with a doctor can help address any concerns you may have.

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