eHealth News, South Africa

Generics Creating Greater Efficiencies in Healthcare

A recent study has revealed that a greater number of South Africans are choosing to use generic drugs over their branded equivalents.

Generics - EHN

A recent study has revealed that a greater number of South Africans are choosing to use generic drugs over their branded equivalents.

In their most recent Medicines Review, Mediscor, a pharmaceutical benefit manager, states that the utilisation of generics has risen to 56.3%, demonstrating a steady increase over a five year period.

In addition, on a basket of 200 of the most prescribed medicines within the private health sector, and across two million lives, a Mediscor study indicates that the difference in price between an original medicine and the average generic medicine is 45.2% while a comparison between the originator drug and the least expensive generic is 55.9%.

Generics, which become available when patents on their branded equivalents have expired, are essentially copies of brand-name drugs, containing the same active ingredient but costing much less.

“Generics are subject to the same rigorous registration process as branded medicines but are substantially less costly”, said CEO of The National Association of Pharmaceutical Manufacturers (NAPM), Vivian Frittelli.

Courier pharmacies and dispensing general practitioners were key drivers of the increase in utilisation, while the use of generics increased to 91% for the treatment of HIV/AIDS and to 86% for oncology.

The lowest usage was observed in over the counter (OTC) medication and medicines dispensed for prescribed minimum benefits (PMBs).

The rising prevalence of South Africans suffering from chronic diseases means a growth in the use of medicines. Despite this, medicine costs in the private sector have increased by just 7.09% since 2014 compared to specialist costs which increased by 10.9% and hospitals which increased by 9.36%. This is a result of the combination of the Single Exit Price (SEP) – which regulates the cost of medicines – and the increasing use of generics.

According to IMS Health, a global organisation which tracks data at sales level, generic medicines currently make up 38% of the prescribed medicines market by value and 65% by volume, while patented medicines make up just 38% of the volume but close to 60% of the market value. This is demonstrative of the saving efficiencies realised through the use of generics.

However, while the use of generics is increasing, South Africans still trail behind their counterparts in the US where generic utilisation is 83%.

The IMS data shows that South Africans could be enjoying substantially greater savings if more generics were used. In their Medicine Review Report, Mediscor quantifies that generic medicine equivalents are available for approximately 73% of the drugs measured, meaning that there is room for an 18% increase in the use of generics.

According to IMS, every 1% increase in the use generics would result in a saving of R176 million, substantially decreasing healthcare costs.

“The fact that a greater number of consumers are choosing generics over more costly branded equivalents bodes well for both health insurers and government who has publicly supported the use of generics as a step towards affordable and accessible healthcare for South Africans,” concluded Frittelli.

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