AAM report: Generic, biosimilar drugs generate $408B in savings
The Association for Accessible Medicines has released its 2023 U.S. Generic & Biosimilar Medicines Savings Report highlighting the value of generic and biosimilar medicines.
According to the analysis, the U.S. healthcare system, including patients, employers and taxpayers, saved $408 billion in 2022 by using FDA-approved generic and biosimilar drugs.
[Read more: Senate committee moves FDA User Fee bill with 5 NACDS-backed provisions]
More than 90% of prescriptions were filled in 2022 with generic or biosimilar medicines, but they accounted for less than 18% of total prescription drug spending and less than 2% of total U.S. healthcare spending. Generics also deliver value to patients. Ninety-three percent of generic drugs have copays under $20 (as compared to 59% of brand-name drugs), and their average copay is $6.16 (as compared to $56.12 for brands).
AAM said it is critical not to take these savings for granted, as growing challenges to a sustainable future for generic and biosimilar competition continue to rise.
"Amid daily news coverage of prescription drug pricing lies the under-appreciated success story of generic and biosimilar medicines,” said David Gaugh, interim president and CEO of AAM. “This report provides a comprehensive review of the evidence that patients and the healthcare system rely on this industry to maintain vitality.”
[Read more: Challenges continue, but generics companies see a bright future with biosimilars]
Prescription drug spending is increasingly driven by a small group of biologic and specialty medicines that, although less than 2% of all prescriptions, are more than half of all spending. Biosimilars are lower-cost, equally effective versions of those high-cost brand biologics. Biosimilars launch at meaningfully lower prices. The average biosimilar price is more than 50% less than the brand price was at the time of biosimilar launch. Moreover, biosimilar competition is forcing brand biologics to reduce their prices. As such, they have saved patients over $9.4 billion dollars in 2022, the report said.
"Biosimilars result in lower prices and greater patient access” said Craig Burton, executive director of the Biosimilars Council. “However, too many patients are being blocked from receiving lower-cost biosimilars.”
Additional highlights from AAM’s 2023 Savings Report include:
- Total generic and biosimilar savings for 2022: $408 billion;
- Total generic and biosimilar savings for the past 10 years: more than $2.9 trillion;
- Total generic and biosimilar savings in Medicare for 2022: $130 billion;
- Total generic and biosimilar savings in commercial plans for 2022: $194 billion;
- Generics represent 90% of prescriptions filled but only 17.5% of prescription drug spending; and
- Generics represent less than 2% of all healthcare spending.
As in the past, this year’s report was developed utilizing independent research from IQVIA, which quantified how much money America's patients and the U.S. healthcare system are saving due to the use of generic and biosimilar alternatives.