Abstract:

Generics are commonly accepted to contribute significantly to treating disease by improving the affordability of pharmaceuticals. Once the patent expires for an originator brand, generics erode prices through creating fierce competition. The objective of this study is to investigate on Turkish pharmaceutical policies over generics through measuring how much they lower the prices, and then develop alternative strategies to maintain higher level of price reduction, and hence saving. Claims data from Turkish Social Security Institution (SSI) for all ambulatory care drugs reimbursed were collected monthly in the period of January 2009 to December 2013 and for selected 12 equivalent groups price erosion and saving impacts due to generic entry be computed. Moreover, the price erosion for 15 generics entering the reimbursement list in 2012 as first generics was measured. For 12 equivalent groups constituting nearly 7% of SSI drug spending, the price erosion was nearly 41% ranging from 8% to 74%. In the first year of the first generic entry, on average the prices were only shrank by 39% with an increase of 41% in units sold. As a result of those analyses, it is concluded that Turkey is not maximizing its full potential with respect to generic medicines. Therefore, it is of great importance that policies such as therapeutic equivalence, tendering, and aggressive generic pricing policy to stimulate higher savings need to be introduced in the near future.

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