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FDA Approved Record-Breaking Number of Generics in 2017

Image result for generic drug approvalsLast year, the FDA approved a groundbreaking total of 1027 generic drugs. The FDA’s latest fiscal year 2017 activities report reveal that the agency has approved more abbreviated new drug applications (ANDAs) in 2017 than any other year. The 763 approvals (927 approvals and tentative approvals) is 112 more generic approvals than the previous year, 271 more than 2015, and 354 more than in 2014. Meanwhile, the number of complete responses decreased in 2017, from 1,725 in 2016 to 1,603 in 2017.

Tyrone’s Commentary:  For every 1% increase in GDR (generic dispense rate) final cost to the plan sponsor decreases by as much as 2%. The national GDR average hovers at 89.5%. So, if a plan sponsor is looking to cut costs and its GDR is below the national average they would be wise to start here.

The total number of ANDAs received by FDA also significantly outpaced all prior years as 1,292 were received, which is 439 more than the total ANDAs received last year. In terms of first generics, referring to the first competitors for their reference products, FDA tallied a total of 54 approvals in 2017 as of September 30, which compares with 73 total approvals in 2016; FDA counts first generic approvals on the calendar year rather than the fiscal year.

The increase in ANDA approvals and decline in rejections for the latest fiscal year is a result of nearly 1,000 new employees whom FDA was able to hire because of the first Generic Drug User Fee Amendments (GDUFA). The second iteration of GDUFA, which was renewed last summer, took effect on October 1.

Three states have introduced bills that would authorize generic drug manufacturers to promote off-label uses for their medications as long as the information provided is correct, STAT reported. Arizona was the first state to enact a similar law. The proposed laws come during a time in which the FDA is under pressure to loosen legislations surrounding off-label promotion of drugs, according to the article.

Tyrone Squires, MBA, CPBS

I am the proud founder and managing director of TransparentRx, a fiduciary-model PBM based in Las Vegas, Nevada. We help health plan sponsors reduce pharmacy spend, by as much as 50%, without cutting benefits or shifting costs to employees.

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