Cost-Effectiveness of a Generic Drug
Generic drugs basically refer to those drugs which have the same dosage, same strength, same benefits and the same effects as those of a branded drug. However, as the name suggests, it is more general in nature. They are known to have the same pharmacological effects as their branded counterparts. The main difference between that of a generic drug and its branded counter-part is the cost of the two. Generic drugs are much cheaper when compared to the branded ones. This is because of the sole reason that the manufacturing of generic drugs does not cost as much as that of a branded drug. Although they have the same qualities as that of a branded drug, the cost of manufacturing a branded drug is high. This is because of the added costs of branding the drug, creating the brand name, advertising the drug, establishing it in all the markets etc. On the other hand, generic drugs are something which doesn’t need much advertising. They are present at a lower rate for people to purchase it. Thus, not a lot of investment goes into the manufacturing of a generic drug.
Is the generic drug cost-effective?
The question of cost-effectiveness comes into play when one talks about the manufacturing of generic drugs. This is simply because of the fact that even though very little investment is required for the manufacture of these generic drugs, they don’t usually do well in the market. This is because of the tendency of customers to trust branded pharmaceutical and medical companies over generic ones. A particular medicine provides ease to the user and this is something that is very personal to him/her. Therefore, if given the chance, he or she will want to invest in a private or a branded company’s manufacturing rather than that of a generic one. Thus, the money spent on the production of generic drugs does not really matter in the long run as it is more towards the losses side.
Customers or users do not mind paying a little extra for branded products as they see medicine as an absolute necessity. It has been observed that most of the customers only purchase generic drugs when no other option is available. This means that in case any alternative or the alternative of the branded drug is not available, customers tend to go for the generic one.
Generic drugs in general
Generic drugs in general suit the lower classes of the society who do not have enough money to afford branded medicines but need the same for the well-being of their bodies. As they provide the same effects, benefits as well as dosage, it is something that is very beneficial for them. This is where generic drugs gain the advantage. This sector of the society highly depends on these generic drugs in terms of any disease that comes into their life.
In countries where the rural population is much more and, in the countries, which are yet to develop, generic drugs still do carry some importance due to the fact that the people in these countries have the required disposable income to purchase these drugs. Therefore, we can say that generic drugs do have a place in the market. However, when observed on a larger scale, they occupy a small segment of the market and thus are not exactly the definition of cost-effective. Even though they are not cost effective as such, they are a necessity for the lower segments of the society who heavily rely on such generic drugs to fulfill their needs and demands.
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