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What’s the difference between brand and generic drugs?

Generic drugs are as safe and effective as brand-name drugs, but they can cost up to 80% less. Learn about the benefits of generic drugs and how to save money on prescriptions.

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When you’re walking down the allergy aisle at the pharmacy, you may be overwhelmed by all the available products. For example, you may see Claritin with generic loratadine right next to it, at just a fraction of the price.

In a pharmacy, you’ll see hundreds if not thousands of these examples of brand-name drugs with their corresponding generic drugs. You can find brand-name and generic products in over-the-counter (OTC) medications as well as in many prescription drugs. With the cost of prescription drugs increasing, it can be a smart financial choice to choose generic when possible. 

Are brand-name and generic drugs the same?

In all the ways that matter, yes.

Brand-name drugs are medications made by a drug company under a specific name that is under patent protection. Besides Claritin, some examples of brand-name drugs include Synthroid, Lipitor, and Norvasc.

generic drug is a medicine that is created to be the same as its corresponding brand-name drug. It must be bioequivalent, meaning that the generic is an equal substitute for the brand. Some examples of generics—corresponding to the examples above—include loratadine (generic Claritin), levothyroxine (generic Synthroid), atorvastatin (generic Lipitor), and amlodipine (generic Norvasc). 

Are generic drugs safe and effective?

Also yes! A generic drug has to be just as safe and effective as the brand name. 

The U.S. Food and Drug Administration (FDA) protects the public by ensuring the safety of prescription drugs and the efficacy of both prescription drugs and over-the-counter medicines. FDA regulations ensure that a generic drug has the same dosage form (such as tablets), strength (for example, same milligram dose), route of administration (taken by mouth), and uses. 

Generic medications are regulated by the FDA, just like brand-name drugs. Companies that manufacture generic drugs are held to the same standards as those that manufacture brand-name products. Generic products must meet requirements for strength, purity, and quality.

Do generic drugs really go through the same trials as brand name drugs?  

Pretty much, yes.

After extensive clinical studies on dosing, safety, and efficacy, a new brand-name drug is submitted to the FDA for approval via a New Drug Application (NDA). 

Because a generic drug is basically a carbon copy of the brand-name drug, the generic manufacturer files an Abbreviated New Drug Application (ANDA). It does not have to prove safety and efficacy, because that has already been established—the ANDA simply has to include bioequivalence studies to demonstrate that the generic drug performs the same way as the brand-name drug and has the same active ingredients. 

These studies look at how long it takes the generic drug to get into the bloodstream. For the FDA to approve a generic drug, the medication must deliver the same amount of medicine into a patient’s bloodstream, in the same amount of time as the brand-name drug.

Are there any other benefits of generic drugs?

Here’s a surprising tidbit: Generic drugs aren’t just cheaper (often up to 80% cheaper), they can also lead to better health outcomes because the reduced cost can lead to proper usage!

No, generic drugs aren’t miracle cures. But, because they are less expensive, patients are more likely to take the medication as it was prescribed. Far too often, Americans will skimp on their medications because they’re too expensive, which can lead to treatment failure and even death.

OK, but what are the disadvantages of generic drugs?

Technically, none!

That said, some patients do not like that the appearance is different from that of the brand-name drug, even though they work the same. In rare cases, some people may find that a certain generic drug may not agree with them due to different inactive ingredients (inactive ingredients do not affect safety and efficacy). In that case, the pharmacist can often order a generic drug from a different manufacturer, or the patient can always switch back to the brand-name drug if necessary. In most cases, however, patients do very well with generic drugs, which is to be expected, since they are approved as equal substitutes to their corresponding brand-name drugs. 

Generic vs. brand-name drugs cost comparison

When comparing generic and brand-name drugs, their safety and effectiveness will be the same but the out-of-pocket cost can be significantly different. Some examples include:

  • On average, brand-name Adderall costs $643* for 60, 20 mg tablets without insurance. For the same prescription, generic Adderall costs $95. Switching from brand-name to generic Adderall could save you $548 or 85%.
  • On average, brand-name Neurontin costs $655 for 90, 300 mg capsules without insurance. For the same prescription, generic Neurontin costs $139. Switching from brand-name to generic Neurontin could save you $516 or 78%.
  • On average, brand-name Cozaar costs $169 for 30, 50 mg tablets without insurance. For the same prescription, generic Cozaar costs $54. Switching from brand-name to generic Cozaar could save you $115 or 68%.
  • On average, brand-name Lipitor costs $575 for 30, 40 mg tablets. For the same prescription, generic Lipitor costs $85. Switching from brand-name to generic Lipitor could save you $490 or 85%.

* Prescription prices change often. These average cash prices (cost without insurance and before discounts) are estimates based on the date of publication and are subject to change.

You can save even more money on prescriptions thanks to WorkMoney’s partnership with SingleCare. Download your free SingleCare discount card and use it to lower your bill at the pharmacy counter – you can use it whether or not you have insurance! How to switch from a brand name to a generic drug

Every state has a law that allows the pharmacist to substitute a generic drug for a brand-name product when a generic is available unless:

  • You request that the brand name is dispensed 
  • Your doctor requests that the brand name is dispensed

In many cases, if you opt for the brand when there is a generic available, you may have to pay a higher copay—or the drug may not be covered at all. You can consult your insurance plan or pharmacist for up-to-date information and pricing.