The Rising Cost of Brand Name Drugs
Under the Affordable Care Act, generic drug manufacturers must wait 12 years until they can start producing generic versions of brand name drugs.
A recent study conducted by the AARP Public Policy Institute indicates that this an expensive 12 years for consumers, especially seniors on prescription drug plans.
The study shows that the costs of brand name drugs rise as this 12 year lifespan draws to a close. This leaves Medicare beneficiaries paying inflated prices to the bitter end of the brand name drug’s time of being the only drug on the market. Even after generic drugs enter the market, the research indicates that brand name drug prices still increase faster than the rate for all drugs. What makes these findings even more relevant is the fact that AARP used 217 brand name drugs most commonly used by people with Medicare Part D prescription drug coverage for the report.
The FDA defines a generic drug as:
“A drug product that is comparable to a brand/reference listed drug product in dosage form, strength, route of administration, quality and performance characteristics, and intended use.”
Generic drugs are great for keeping prescription drug use affordable for seniors and preventing drug shortages. The Center for Drug Evaluation and Research (CDER) reports that generic drugs make up 66% of the prescription drug market, yet brand name 84% in terms of dollar volume. Something doesn’t sound right here. Many seniors depend on prescription drugs and if these costs continue to rise so rapidly, not even a Medicare Part D plan will be able to save them. According to the AARP website, the organization is working on lowering the cost of prescription drugs by finding ways to make generic drugs more accessible to seniors.
To get more information about Medicare Supplement Insurance plans, talk to one of our Medigap plan representatives today or use our instant quote below.
