Out-of-pocket costs vary widely for branded, generic drugs

NEW YORK —The often wide gap between what consumers will pay out of pocket for a branded versus a generic drug is one big factor driving the continually rising demand curve for me-too medicines.

That difference in price has narrowed in recent years as generic-only me-too drug makers — and the many brand-name drug companies that have moved into the lower end of the prescription price spectrum by buying up or launching their own generic drug companies — become more sophisticated and selective about their pricing strategies. But the differences in many cases still are substantial.

In turn, that often translates to substantially lower out-of-pocket costs for health plan beneficiaries who choose the generic over the brand, when available. And, as shown in the chart compiled by SDI Health below, the differences in costs paid directly by patients for branded and me-too medications can range from a few dollars to a fraction of the cost of an original drug.

Average out-of-pocket costs for branded and generic products by therapeutic category*

THERAPEUTIC CATEGORY AVG TOTAL Rx OUT-OF-POCKET COST THERAPEUTIC CATEGORY AVG TOTAL Rx OUT-OF-POCKET COST THERAPEUTIC CATEGORY AVG TOTAL Rx OUT-OF-POCKET COST THERAPEUTIC CATEGORY AVG TOTAL Rx OUT-OF-POCKET COST THERAPEUTIC CATEGORY AVG TOTAL Rx OUT-OF-POCKET COST
HIV $80.00 HRT $27.97 Gastrointestinal $22.30 Allergies $19.27 Skin anti-infectives $16.62
  Total branded 81.52   Total branded 35.04   Total branded 60.11   Total branded 31.30   Total branded 31.24
  Total generic 18.67   Total generic 9.62   Total generic 10.00   Total generic 11.62   Total generic 11.41
ADHD $35.92 Osteoporosis $24.61 Contraceptive $22.13 Sleep disorder $18.83 Arthritis $14.99
  Total branded 45.08   Total branded 40.71   Total branded 23.02   Total branded 49.64   Total branded 52.76
  Total generic 22.03   Total generic 10.71   Total generic 15.84   Total generic 9.10   Total generic 8.10
Antipsychotic $34.47 BPH $23.92 Diabetes $22.06 Pain $17.81 Hypertension $12.50
  Total branded 44.64   Total branded 42.57   Total branded 39.04   Total branded 51.81   Total branded 36.67
  Total generic 11.33   Total generic 13.29   Total generic 8.81   Total generic 12.77   Total generic 8.35
Asthma $29.68 Cholesterol $23.51 GERD $20.55 Depression $17.75 Systemic antibiotics $12.41
  Total branded 31.53   Total branded 38.06   Total branded 37.73   Total branded 37.33   Total branded 46.54
  Total generic 14.55   Total generic 10.38   Total generic 11.79   Total generic 10.48   Total generic 9.29
*For the 12 months ended September 2010 Source: SDI Vector One - Payer

 

Consider the market for gastrointestinal medicines. On average, according to SDI, patients paid $10 out of pocket for the generic version of a substitutable GI drug at the pharmacy, versus more than $60 for the branded drug. For diabetes medicines, the average was $39.04 for the branded version and $8.81 for the generic. On the other hand, the spread in out-of-pocket costs for consumers was much narrower for oral contraceptives: patients paid an average of $23.02 for the brand name and $15.84 for the alternative.

The two charts at the bottom of page 34 — and the chart at lower right on page 40 — track two significant pricing benchmarks consumers deal with routinely at the pharmacy counter. Both sets of numbers shine a light on the forces propelling generic utilization and prescription substitutions, as both managed care plans and their patients search aggressively for ways to save money.

2010 out-of-pocket costs for overactive bladder treatments

AVERAGE OUT-OF-POCKET COSTS OF A Rx AT WHICH A PATIENT REQUESTS TO SWITCH TO ANOTHER DRUG AVERAGE OUT-OF-POCKET COSTS OF A Rx TO WHICH THE PATIENT SWITCHES
PRODUCT APRIL MAY JUNE JULY AUGUST PRODUCT APRIL MAY JUNE JULY AUGUST
Detrol $58.74 $57.08 $58.23 $63.95 $72.30 Detrol $20.35 $21.54 $26.09 $19.42 $23.09
Detrol LA 63.75 60.96 64.31 66.75 73.01 Detrol LA 20.93 18.64 20.40 18.54 21.51
Ditropan NA NA NA 46.92 88.01 Ditropan NA NA NA 4.00 NA
Ditropan XL 68.08 82.18 78.86 85.84 86.14 Ditropan XL 15.54 19.67 15.85 18.71 15.09
Enablex 55.13 56.12 59.18 63.17 66.28 Enablex 22.76 22.79 21.86 21.40 22.14
Flavoxate HCL 25.28 28.53 25.53 29.94 22.94 Flavoxate HCL 3.30 13.93 19.62 NA 18.05
Gelnique 85.06 75.85 72.79 72.71 78.35 Gelnique 29.42 20.66 39.75 10.06 13.06
Oxybutynin chloride 9.19 8.58 8.91 9.04 8.22 Oxybutynin chloride 16.13 14.88 13.75 21.40 15.14
Oxybutynin chloride ER 30.57 33.26 33.28 33.21 33.18 Oxybutynin chloride ER 11.33 11.85 12.44 10.81 10.67
Oxytrol 57.55 62.57 65.49 82.47 75.36 Oxytrol 16.85 18.64 60.99 56.53 77.96
Sanctura 56.65 49.15 47.26 57.43 61.08 Sanctura 22.85 14.71 32.56 41.29 24.89
Sanctura XR 71.66 71.45 70.76 74.59 68.97 Sanctura XR 28.23 31.27 21.77 24.49 24.08
Toviaz 73.41 73.58 76.63 80.04 81.30 Toviaz 28.07 22.55 26.17 31.75 32.60
Trospium chloride NA NA NA NA 48.45 Trospium chloride NA NA NA NA 36.66
Urispas NA NA NA NA NA Urispas NA NA NA NA NA
Vesicare 73.14 73.58 71.58 73.39 72.06 Vesicare 16.25 20.90 18.40 21.61 19.55
Source: SDI Health

 

Using as an example the market for prescription products to treat depression, SDI Health drilled deeply into pharmacy dispensing and sales data, and applied sophisticated analytics to arrive at two key data points for each drug used to treat the condition. The result: a set of findings on the “ouch” point for each of those drugs — the average limit to what a consumer will pay for his or her prescription — and the average amount he or she saved by seeking a generic or therapeutically substitutable alternative.

Thus, the chart on the left shows the average price point for each drug at which the patient will “reverse” the prescription (i.e., refuse to have it filled because of its cost), noted Tim McGee, associate director of client solutions and syndicated analytics for SDI. The chart on the right shows the average out-of-pocket cost paid by patients for a generically or therapeutically equivalent product, after the patient has rejected the original brand-name script and gone back to his or her doctor for a new, lower-price alternative, McGee explained.

As shown, the difference in price can be substantial.

2010 out-of-pocket costs for depression treatments

AVERAGE OUT-OF-POCKET COSTS OF A Rx AT WHICH A PATIENT REQUESTS TO SWITCH TO ANOTHER DRUG AVERAGE OUT-OF-POCKET COSTS OF A Rx TO WHICH THE PATIENT SWITCHES
PRODUCT APRIL MAY JUNE PRODUCT APRIL MAY JUNE
Aplenzin $140.48 $139.97 $167.59 Aplenzin $13.90 $18.73 $25.78
Bupropion 42.37 41.99 40.04 Bupropion 27.70 28.27 29.30
Celexa 63.83 68.01 57.67 Celexa 9.15 8.55 10.19
Citalopram 11.82 10.06 9.47 Citalopram 20.65 19.99 22.03
Cymbalta 80.54 83.88 84.85 Cymbalta 13.90 15.09 16.17
Effexor 71.85 57.88 52.72 Effexor 31.71 19.48 25.96
Effexor AR 88.50 92.09 87.87 Effexor AR 25.30 25.62 23.84
Fluoxetine 22.93 26.09 22.90 Fluoxetine 28.62 24.84 22.32
Fluoxetine (PMDD) 18.77 5.20 8.68 Fluoxetine (PMDD) 9.63 5.23 5.42
Fluvoxamine 25.19 31.90 31.10 Fluvoxamine 11.83 21.88 22.09
Lexapro 63.59 63.69 62.11 Lexapro 11.45 11.61 10.95
Luvox/CR 67.01 78.07 75.19 Luvox/CR 9.94 15.41 11.11
Paroxetine/ER 24.55 26.55 24.10 Paroxetine/ER 18.86 21.14 24.71
Paxil/CR 58.27 63.50 62.14 Paxil/CR 14.47 17.82 17.34
Pexeva 86.84 99.92 85.46 Pexeva 5.90 43.72 25.57
Pristiq 72.52 75.20 71.50 Pristiq 19.91 18.27 21.99
Prozac 134.31 118.08 136.30 Prozac 13.60 17.10 15.71
Prozac weekly 54.44 57.55 71.34 Prozac weekly 13.16 25.31 40.13
Sarafem 80.97 97.87 86.53 Sarafem 9.76 9.18 7.71
Sertraline 17.26 17.04 16.83 Sertraline 26.57 23.54 25.43
Venlafaxine HCL 28.13 26.80 28.93 Venlafaxine HCL 31.85 29.58 29.59
Venlafaxine HCL ER 81.18 76.60 76.03 Venlafaxine HCL ER 28.31 30.96 28.34
Wellbutrin SR 82.49 94.33 100.46 Wellbutrin SR 18.52 26.63 15.45
Wellbutrin XL 90.16 85.88 77.21 Wellbutrin XL 18.96 17.04 18.01
Zoloft 72.74 74.57 62.41 Zoloft 10.51 12.65 10.44
Source: SDI Health

 

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