Although the FDA does not set drug prices, FDA commissioner, Scott Gottlieb, recognizes the important role the agency can play in lowering overall prescription drug prices by approving more generic drugs.
Since taking office earlier this year, the FDA commissioner has announced several key strategies aimed at increasing generic drug competition in the US. Already, Gottlieb has promised to publish and regularly update a list of off-patent drugs with no competitor products on the market, speed up generic drug application review times, and amend regulations that allow companies to prevent the timely approval of generic competitors.
Building on these early efforts, Gottlieb recently announced yet another move that will spur generic drug competition. Moving forward, the FDA will now begin prioritizing the review of applications for generic drugs that could launch immediately after the 180-day market exclusivity period ends for a first-to-market copy.
This exclusivity period, awarded to the company owning the first approved generic version of a brand name drug, is intended to incentivize the development of generic products. During the 180-day period, companies are able to sell their generic free from any other competition.
However, the FDA recognizes that the real cost saving benefit provided by generics does not come into full effect until there are multiple generic versions available. Although the price of medication usually drops after the introduction of a single generic drug, the arrival of a second competitor product knocks the price down by over 50% on average.
Gottlieb is confident that this new initiative will ensure that second generic versions can get to market as quickly as possible.
Already this year, the FDA has approved a record number of generic drugs, and Gottlieb’s FDA believes that this new measure will allow the agency to continue achieving record highs year on year.