The U.S. has a number of policies related to drug pricing, affordability, and availability. To encourage manufacturers to innovate with new therapies, patent policy rewards the creation of new branded medicines. As those patents come to an end, generic drug manufacturers may enter a market and seek to sell their products at lower prices than the competing brand drugs. Policies that support competition of lower price generics for brand drugs, once the generics become available for sale, helps to make drug prices more affordable for taxpayers, payers, and patients.
This study evaluates these concerns by updating a previous ASPE Issue Brief that compared the effects of generic competition on prices of the earlier periods of 2007-2011 and 2012-2015 with adding the most recent period of 2016-2019. The study examines whether or not the expected effect of generic entry on prices is similar to the prior two periods.
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