Posted by Michael Wonder on 14 Dec 2019
FDA issues new analysis linking greater generic competition and lower generic drug prices
13 December 2019 - Greater competition among generic drug makers is associated with lower generic drug prices, according to a new analysis using two different sources for wholesale prices.
We show that generic drug prices after initial generic entry decline with additional competition using both the average manufacturer prices (AMP) reported to the Centers for Medicare and Medicaid Services (CMS) and invoice-based wholesale prices reflecting pharmacy acquisitions from IQVIA’s National Sales Perspective database (NSP).
Estimates using AMP show price declines associated with additional generic competition steeper than those based on invoices for pharmacy acquisitions, though most of the difference comes from wholesaler mark-ups.
