The popularity of generic medication has been on the rise in South Africa for several years, following trends in the UK and US. Though South Africa still lags far behind these countries, the potential for improvement cannot be underestimated, with up to R4 billion in potential savings if newer generics are widely adopted. This is according to Vivian Frittelli, CEO of the National Association of Pharmaceutical Manufacturers (NAPM) which represents the interests of generic medicine manufacturers and marketers in SA, the mission of which is to champion greater access to medicine for the SA population.
Frittelli goes on to claim that many doctors and patients perceive generics to be inferior to brand-name medication due to its lower price, often being substantially cheaper than the original. This perception needs to change if South Africa is to realise the desperately-needed savings mentioned above.
The marketing of drugs, however restricted, is often to blame here as it seeks to reinforce the perception of generics being inferior. “I worked for an originator company for 20-odd years and one of our messages was this: if your kid had meningitis, would you use generics?” says Frittelli.
In a comparison of the cheapest generic price versus that of the originator for the top 200 most prescribed drugs, NAPM found that generics were on average 56.1% cheaper. It also found that since 2010 this gap had been widening.
The degree to which generics are used in South Africa is hard to measure. Mediscor, a company who manages pharmacy benefits, estimates generics make up 56% of dispensed medication in the country, and that this number is rising.
IMS Health, an organisation that collates sales data on a global scale, state that 65% of items dispensed in the private sector were generics, but they only accounted for 40% of South Africans R22 billion drug expenditure. They estimate that every 1% increase in generic usage translates to a saving of R270 million for the consumer.
These savings would be passed on through medical schemes, whose lower costs would enable them to reduce their premium increases or offer improved benefits to their customers.
Discovery Health, one of South Africa’s largest health insurers, has backed the NAPM’s findings. Their internal data suggests that generics make up 58.8% of dispensed medication by volume and 46.6% by cost.
This data also revealed that nearly two-thirds of generics are 40% cheaper than their original equivalents, 48% are 50% or cheaper.
For a practical example, a patient suffering from a common combination of asthma and allergic rhinitis who then picks up a throat infection due to inhaler use could save up to R4 000 over the course of a year using generics as opposed to original medication.
The UK offers an excellent case study into the potential impact of generic drugs. There, nearly 70% of medicines dispensed are generics, yet they cost just 29% of the NHS’ total drug expenditure. In the US nearly 80% of prescriptions are filled by generics.
“As life expectancy increases and the cost of medicines escalates, the importance of the generics industry is being highlighted as it allows more people greater access to healthcare. The value proposition presented by generics cannot be disputed” Frittelli says.
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