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In 2003, the FDA published a new regulation aimed at closing legal loopholes in the original Hatch-Waxman Act that sometimes kept generic versions of drugs off the market longer than necessary. Changes instituted in the new rule provide consumers with faster access to high-quality, low-cost generic drugs while maintaining legitimate incentives for innovative new drug development. At the time the regulation was published, the FDA estimated that the final rule would result in savings to consumers of |
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$35 billion over 10 years. In April 2006, the agency published the results of an analysis of generic drug prices. After analyzing drug price data, the agency concluded that generic competition has lowered drug prices. In this study, the FDA found that the first generic competitor prices its product only slightly lower than the brand-name manufacturer. But the appearance of a second generic manufacturer reduces the average generic price to nearly half the brand name price.
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