A generic Drug or Pharmaceutical should contain the same active ingredients as that of the original or parent formulation.According to the USFDA generic Pharmaceuticals or generic drugs are identical to or acceptable within an bioequivalent range with respect to pharmacokinetic and pharmacodynamic properties of the to the branded pharmaceutical product. Hence, Generic Pharmaceuticals or generic drugs are considered by US FDA as drugs identical in dose, strength, route of administration, safety, efficacy, and intended use.
US FDA establishes required standards for a generic drug giving a range of acceptable values and range of variations that a generic drug is required to be bioequivalent to a brand name drug .Generic drugs is likely to differ from original brand name drug with respect to inactive ingredients or excipients, its configuration, release mechanisms, packaging shape , scoring.
In most cases, generic products are available once the patent protections afforded to the original developer have expired. When generic products become available, the market competition often leads to substantially lower prices for both the original brand name product and the generic forms. The time it takes a generic drug to appear on the market varies. In the US, drug patents give twenty years of protection, but they are applied for before clinical trials begin, so the effective life of a drug patent tends to be between seven and twelve years.
Generic drugs are usually sold for significantly lower prices than their branded equivalent. One reason for the relatively low price of generic medicines is that competition increases among producers when drugs no longer are protected by patents.Other probable reasons for low cost are
Generic drug companies may also receive the benefit of the previous marketing efforts of the brand-name drug company, including media advertising, presentations by drug representatives, and distribution of free samples. Many drugs introduced by generic manufacturers have already been on the market for a decade or more, and may already be well-known to patients and providers.
When a pharmaceutical company first markets a drug, it is usually under a patent that, until it expires, allows only the pharmaceutical company that developed the drug to sell it. Generic drugs can be produced without patent infringement for drugs where: 1) the patent has expired, 2) the generic company certifies the brand company's patents are either invalid, unenforceable or will not be infringed, 3) for drugs which have never held patents, or 4) in countries where the drug does not have current patent protection. Patent lifetime differs from country to country; typically an expired patent cannot be renewed. In the U.S., patent extensions may be granted if changes are made; some pharmaceutical companies have sought extensions on things as minor as changes to the shape and color of the pill; generic makers are excluded while the adjudication of the extension is considered. A new version of the drug with significant changes to the compound could be patented, but this requires new clinical trials. In addition, a patent on a changed compound does not prevent sales of the generic versions of the original drug unless regulators take the original drug off the market.
The companies most negatively impacted by generic drugs are the pharmaceutical companies who originally develop new drugs. When their patents expire, these companies are usually forced to lower their prices in order to compete with the cheaper generic versions of their products. Major pharmaceutical companies generally charge relatively high prices for their drugs while the patents are in effect, which allows them to recoup their R&D costs and make a profit before generics become available. Nonetheless, generics eventually lead to either lower profit margins or a loss of market share, both of which are less than ideal for drug companies.