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Generic Pharmaceutical Savings Reach $217B in 2012

Fri, 12/20/2013 - 9:49am

Thee Generic Pharmaceutical Association (GPhA) has released the fifth annual report, Generic Drug Savings in the U.S., showing that the use of generic medicines resulted in $217 billion in savings to the U.S. health care system in 2012 and $1.2 trillion over the last 10 years (2003-2012). For the first time, this year's report features a special section on retail savings, confirming the savings that generic medicines deliver to millions of people.  

"The generic pharmaceutical industry continues to generate unprecedented savings for the U.S. health system," said Ralph G. Neas, President and CEO of the Generic Pharmaceutical Association (GPhA), which released the report. "As more Americans seek out affordable treatment options, generic medicines remain one of the few tried and true ways that patients, payers, the business community and others can find some relief from soaring health costs." 

For the first time, this report breaks out the savings for each payer type (i.e., out-of-pocket, insurers, Medicaid, other third-party payers) at the retail level. Retail sales represent approximately 76 percent of total savings from generics.  In 2012 alone, savings for the retail markets totaled $171 billion. Interestingly, generics have saved out-of-pocket cash payers $78 billion over the past 10 years – these typically are the uninsured and poorer customers. All data were compiled by IMS Health on behalf of GPhA.

Select findings from the 2013 Generic Drug Savings Report:

Segment

Savings from Generics

Retail market overall savings

$931 billion over 10 years

Commercial third-party payers (insurance companies, employee health plans)

$552 billion over the past 10 years

 

Medicare Part D or other federal benefit enrollee savings

$301 billion over 10 years

Seniors enrolled in Medicare Part D

$180 since Part D program began in 2006

Medicaid beneficiaries who get prescriptions from retail outlets

$96 billion over 10 years

Patients/Customers paying out-of-pocket (typically uninsured or underinsured)

$78 billion over 10 years

"From policymakers to patients, any efforts to curtail health spending must capitalize on the savings from safe, affordable generic medicines. In a time when cutting costs is everyone's priority, generics continue to put more treatments within reach for so many people," said Neas. "Embracing policy that encourages access to generic medicines goes hand in hand with savings."

For the full report, visit: http://www.gphaonline.org/media/cms/2013_Savings_Study_12.19.2013_FINAL.pdf

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