January 1995
FDA Consumer special report

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When Stuart Addison goes to the pharmacy in Margate, Fla., he has the pharmacist fill his prescriptions with generic drugs. Addison, a retired federal government auditor, is one of the many Americans who are choosing generics when they buy drugs.

"My motivation is to keep the prices down," said Addison, noting that his insurance plan pays for his prescriptions. "My pocketbook is not directly affected, but in the long run, I'm helping to keep down insurance premiums."

Although not all approved drugs are available in a generic version, those that are can offer substantial savings to consumers. For millions of Americans, the less-expensive drugs could mean the difference between getting necessary therapies and not being able to afford proper medical treatment.

Insurance companies' recommendations to policyholders that they choose generics over brand-name drugs whenever possible, coupled with the promotional efforts of large drug chains, have helped heighten consumer awareness of the availability of generics. The result has been that generic sales have been booming most of the years since 1984, when Congress passed the Drug Price Competition and Patent Term Restoration Act. This act expanded the number of drugs eligible to be manufactured as generics. The new rules eliminated the need for duplicate safety and efficacy testing for generics, saving industry time and money. The Food and Drug Administration also developed and issued explicit guidelines for a generic product's bioequivalency (see accompanying article) and stability, ensuring that products retain potency. In addition, products must meet specifications set by the U.S. Pharmacopeial Convention, a private scientific organization that sets standards for drugs and drug products in the United States. Almost 80 percent of U.S. generic drug production is done by brand-name firms in modern manufacturing plants.

In 1991, consumers spent about $5.5 billion for generics and are expected to spend more than $15 billion in 1995, according to a 1992 report by Frost & Sullivan International, a health information research organization. The report found that expiring patents on pioneer (brand-name) drugs, coupled with increased attention to containing health-care costs, will play important roles in the growth of the generics industry in the next decade.

Since 1984, there has been a succession of top-selling drugs that have lost their market exclusivity and been challenged for market share by generic brands. An average of about 10 pioneer drugs lose patent protection annually. Among the top-selling brand-name drugs scheduled to lose protection by 1998 are the anti-ulcer drug Zantac by Glaxo Pharmaceuticals, the hair-growth stimulant Rogaine by The UpJohn Co., and the anti-cancer drugs Platinol and Taxol by Bristol Myers Oncology Division.

Scandal Rocks Industry

Popularity of the copycat products grew significantly after 1984, when the approval process was widened. But that popularity took a downturn in 1989, when scandal rocked the industry. Federal investigators uncovered such problems as illegal gratuities, fraud, obstruction of justice, and noncompliance with various manufacturing procedures by some industry officials.

Subsequently, FDA investigators rushed to reevaluate data presented in hundreds of generic drug applications. More than 2,550 samples of the top 30 prescribed generic drugs--or about 30 percent of all generic drugs on the market--were collected and laboratory-tested. The agency conducted intensive inspections of 36 of the largest generic drug firms and 12 contract laboratories.

Agency Steps Up Testing

In early l990, more than 300 scientists at 17 FDA labs tested samples from generic drug companies. The agency determined that only 27 samples, or approximately 1 percent of those tested, did not comply with standards of potency, dissolution, content uniformity, product identification, moisture determination, or purity.

FDA also tested 429 samples representing at least three different batches of all 24 narrow-therapeutic-range drugs (those in which the difference between a therapeutic dose and a toxic dose is small) then currently marketed. The 24 drugs, made by 73 brand-name and generic drug manufacturers, were selected because of their high potential for adverse reactions or therapeutic failure if they lacked bioequivalency. Only five of the samples--all aminophylline tablets, a bronchodilator--failed to meet USP standards. None of the defects in the generic drugs posed a public health hazard.

Based on these results and the fact that brand-name products experience similar failures at a similar rate, the agency recommended that doctors continue to consider prescribing generic drugs when appropriate, to offer products at lower cost to consumers.

FDA's Office of Generic Drugs is charged with conducting reviews and is responsible for the subsequent approval of the imitator products. The office interacts with a national network of FDA field offices to monitor the production methods of generic makers.

Pre-Approval Inspectors

In l990, the agency instituted product-specific, pre-approval inspections of manufacturing sites listed in a sponsor's application. During inspections, FDA reviews the step-by-step manufacturing process and monitors how much and what kind of active ingredients, excipients (material added to make products a suitable consistency), flavorings, and other substances will be used. Sponsors must even identify the type of machinery that will be used in each step of the manufacturing process. Just as it does with brand-name drugs, the agency closely regulates generic makers' production sites and blocks the marketing of any drugs produced in substandard facilities. FDA conducts more than 5,000 inspections at drug plants annually.

Agency inspectors also review on-site production records, examine exhibit batches, and determine whether the plant is capable of producing the drug properly before giving a satisfactory recommendation for the drug's approval. Plant managers must be able to show that the operation has sterile production facilities where required and acceptable assembly line procedures, and that labeling procedures are designed to prevent mix-ups. The company must also prove that finished products are kept in a temperature-controlled storage area and that products can be easily identified to prevent drug mix-ups.

Applications Increase

From 1984 through 1993, the Office of Generic Drugs received 7,289 applications to manufacture and market generic drugs, called abbreviated new drug applications (ANDAs). FDA determined that a little more than half--4,141 applications--completed the agency's requirements and could be marketed. Many others were either dropped by their sponsors or are pending further review by FDA for a variety of reasons. The agency receives thousands more--5,234 in 1993--supplements and amendments to supplements that request changes in strength, dosage form, or manufacturing method.

Currently, FDA approves about 250 generic drugs annually.

Nearly 40 to 60 percent of the applications submitted to FDA are rejected within 30 days of submission. The reasons for their rejection range from the firm's failure to provide sufficient stability data, to incomplete sample batch records on bioequivalency testing, to an application that is missing some form of necessary research data.

A staff of nearly 50 chemistry reviewers in the generics office sifts through stacks of data submitted by a firm after it has conducted extensive product testing. The applications are reviewed for their scientific content and for such manufacturing procedures as validation methods, raw material specifications, and container and closure systems.

Eight pharmacists review generic labeling. Part of their mission is to anticipate problems of confused or mistaken identity that can arise in drug labeling. In some cases, the pharmacists reject a product's trade name if it is too similar to another product's.

Kent Johnson, formerly the generics office's associate director of labeling and professional support, said that having clearly distinct names is especially important to avoid drug mix-ups in ambulatory-care facilities, institutional settings, and in emergency rooms because there may not be enough time for the staff to closely examine the label.

Pioneer drugs are often protected by several patented indications in their labeling. Labeling for generic products reflects only approved indications that are not patent protected. Generics office pharmacists monitor the labeling and review new labeling as exclusive claims expire and are added to generic labels.

FDA's stepped-up effort to improve and monitor generic drug production should continue to provide consumers with safe, effective and affordable drugs.

Jeffrey Yorke is a writer in FDA's Center for Drug Evaluation and Research.

Drug Terms

Generic: A version of a drug that is equivalent to the pioneer or brand-name drug and is not marketed until the pioneer drug's patent exclusivity has expired. These "copies" are often marketed under just the generic name of the drug--for example, Diazepam.

What Is Bioequivalency?

Scientists measure the time it takes the generic drug to reach the bloodstream. This gives them the rate of absorption (or bioavailability) of the generic drug, which they then compare to that of the pioneer drug. The generic version must deliver the same amount of active ingredients into a patient's bloodstream and in the same time as the pioneer drug. Brand-name drugs are subject to the same bioequivalency tests as generics when their manufacturers reformulate them.

When Getting Your Prescription Filled ...

Second, physicians and their patients should discuss and decide whether a brand-name or generic is the best therapy. There should be an agreement between them, and a physician should be aware of which drug a patient is taking. If they jointly decide to change a therapy--whether it be a switch between two brand-name products or between brand-name and generic--they should both commit to follow carefully the outcome of that change in therapy.

Third, pharmacists and health-care providers should give careful attention to FDA evaluations of therapeutic equivalence. A drug's therapeutic rating is published monthly in the "Orange Book," Approved Drug Products With Therapeutic Equivalence Evaluations. The rating will indicate whether a drug has been judged by the agency to be therapeutically equivalent by meeting the criteria of pharmaceutical equivalents, bioequivalence, labeling, and good manufacturing practices.