It is no secret that brand-name drugs in America are often expensive. Luckily, for the many American’s who are not able to afford those brand-name drugs, generic drugs are an option. Most people are somewhat familiar with the concept of generic drugs, and most people have benefited from the lower costs of these drugs at some point in their lives. According to the FDA, in the United States, 9 out of 10 prescriptions filled are for generic drugs.1 This is likely because on average, generic versions of drugs are 85% cheaper than the brand-name alternative.2 These lower costs have been incredibly helpful for most Americans, but how is it possible that these drugs are so much cheaper? Why do brand-name drugs exist at all if these low-cost options are available?
The cost of brand name vs generic drugs is directly related to which FDA pathway a company is required to follow, a New Drug Application (NDA), or an Abbreviated New Drug Application (ANDA). The NDA is exactly what it sounds like – an application for approval of new drugs. This pathway is for completely novel drugs, and on average, it takes around 10 years for a company to get all the documentation and testing complete for an NDA.3 An ANDA on the other hand, can be used by companies trying to replicate an already existing drug. It essentially allows a company to compare the drug they want to market with a pre-existing drug and provide evidence that their drug is equivalent with regards to dosage form, safety, strength, route of administration, quality, and performance characteristics.2 On average, it only takes between 6 months and a few years for an ANDA to be completed and approved.4
It is clear where the price difference comes into play in these situations – researching & developing a drug for 10 years is going to be significantly more expensive than researching & developing for only a few years. Whether you are working toward completing an NDA, or an ANDA, our regulatory experts at EMMA International can help ensure your testing, documents, and applications are compliant with the FDA requirements. Contact us at 248-987-4497 or info@emmainternational.com for additional information.
1FDA (Nov 21, 2019). Buying and Using Medicine Safely. Retrieved on October 27th, 2020 from https://www.fda.gov/drugs/buying-using-medicine-safely/generic-drugs
2FDA (June 06, 2018). Generic Drugs. Retrieved on October 27th, 2020 from https://www.fda.gov/drugs/generic-drugs/generic-drug-facts
3PhRMA (May 2015). Biopharmaceutical Research & Development. Retrieved on October 27th from http://phrma-docs.phrma.org/sites/default/files/pdf/rd_brochure_022307.pdf
4FDA (Nov 17, 2017). News & Events for Human Drugs. Retrieved on October 18th, 2020 from https://www.fda.gov/drugs/news-events-human-drugs/generic-drug-approval-process
