Generic drug

A generic drug is one that is made other than by the original developer of a drug or under its authority. Generic drugs become available when a drug goes out of patent.

Due to the increasing pressure on the budgets of both state and private health care providers there has been increasing pressure on prescribers to use generic drugs whenever possible and the result has been that the original versions lose market share very quickly once generics become available.

Generic versions can receive approval quite quickly as regulators do not require them to go through the full process including clinical trials and so on. Instead, generics manufacturers need to be able to show that the drug is equivalent to the original version. This is reasonable as the drug will have the same active ingredient and as similar a formulation as the generic manufacturer can make.

In some countries (most importantly the US) the first generic manufacturer to reach market can receive an addition reward, such as a period of exclusivity before regulators approve any more generic versions of the same drugs.

Patent holders clearly have a lot to lose from the launch of generics and often go to great lengths to delay them. One common tactic is to separately patent the formulation of a drug (at a later date from the patenting of the active ingredient itself) in order to, in effect, lengthen the life of the patent. This frequently leads to litigation as, at the same time, generic manufacturers have, in recent years, become more aggressive about launching quickly and more willing to go to court.

Another common response to the launch of generics is to launch improved formulations (again covered by new patents) as patents expire.

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