The Push for Generics

For everyone from legislators to healthcare payers to corporate executives, generics is the new hot topic. First, the Greater Access to Affordable Pharmaceuticals Act of 2002, which would eliminate the 30-month delay that is triggered when a brand-name company sues a generics maker for patent infringement, passed the US Senate and is under consideration in the House.

Various organizations, including the senior advocacy group AARP and industry's own regulator FDA, are launching multimedia advertising campaigns that promote generics. Major employers, such as General Motors and IBM, have also joined the push by supporting the "Greater Access" act through a joint corporate-state government lobbying group. (According to a story in the New York Times, Georgia-Pacific and Verizon left the group after Lilly and Wyeth, respectively, threatened to cancel contracts.)

Gererics' share of the RX market

But the most direct tactic-counterdetailing- hits pharma companies on their own turf. State governments and pharmacy benefit managers are sending pharmacists into the field to talk to doctors about the value and safety of generics. According to a report in the Washington Post, West Virginia and Michigan have already hired counterdetailers, and the states of Vermont, Massachusetts, and Washington have proposed or passed similar programs. Insurers and PBMs, which stand to save millions by switching patients to generics, have launched their own such initiatives. AdvancePCS, for example, employs 150 counterdetailers that visit up to 20,000 top prescribers each year. The PBM also offers vouchers that patients can redeem for free samples of generic products. First Health Group, Merck Medco, and many of the Blue Cross Blue Shield companies also have their own counterdetailing programs.

Blue Cross Blue Shield of Michigan started a unique variation of the trend in late 2000. Its pilot program reaches out to six physician groups representing 1,100 primary care doctors. Its main objective is to reduce the ingredient cost per utilizing member per month. Every quarter, BCBS compares participating physician groups' drug trend with a similar, nonparticipating group. If the doctors have reduced their trend by 1 percent, the insurance company shares the savings with the doctors. "The net savings so far are more than a half million dollars," says BCBS' director of pharmacy administration, Atheer Kaddis, PharmD. "Physicians are giving us a lot of positive feedback. They like that it's an incentive program as opposed to a risk program."

BCBS works with the leaders of each group to send e-mails and newsletters, then following up with visits to doctors to discuss individual prescribing patterns. Armed with the same prescription data to which reps have access, counterdetailers-sometimes called "clinical consultants"- can address the specific brand names that doctors prescribe and recommend alternatives.

Healthcare payers may be saving money, but so far, the effect on generics' share of the market has been negligible. Generics' dollar-share of total prescriptions has been in decline since its peak of 12 percent in 1995. One reason for that is the escalating price of new brand-name products. Another, according to a spokesperson for the Generics Pharmaceutical Association, is the brand-name industry's abuse of patent legislation.

He claims that in 2000, of 30 drugs that should have gone off patent, 20 did not. And in 2001, only 3 of 26 products that should have become available in generic form actually did so. But if the new legislation becomes law and pharma loses one of its most powerful patent-protection tools, that could change.

Next on generics' list of battles: the $18 billion biotech industry. Some companies are already selling copycat biologics in developing countries, and others are gearing up for production in the US market.