22 October 2013

Generics, "Me-Too" Drugs, and Pharmaceutical Spending

Peter Arcidiacono, Paul Ellickson, Peter Landry, and David Ridley study the entry of new products in the market for anti-ulcer drugs. They conclude that in 2010, generic entry reduced insurance payments for this class of drugs by $1 billion, while the introduction of patent-protected "me-too" drugs that closely resembled existing products raised spending by about $7 billion.