British health officials are to extend a consultation on the pricing of so-called branded generics, or off-patent drugs given a new brand name by non-originator firms. Media reports note that such products are occasionally reimbursed at a higher rate than "standard" generics, even though two differently-priced generics may be chemically identical. Government sources claim that some branded generics are priced at similar levels to innovative patented drugs in the UK.
An earlier consultation round on the issue, completed in January 2005, recommended that branded generics should be priced either at the standard branded price or at the price of the cheapest equivalent generic -- whichever was lower. The study also recommended that such drugs be de-listed from the UK's pricing mechanism, the PPRS.
However, the attempt to relax pricing controls for generics of this type has not entirely succeeded. Much of the concern focuses on the correct identification of supposedly low-priced "standard branded" generics in oral solid dosage form. It is hoped that the 2006 consultation round will resolve confusion over this process.
The apparent backfiring of the attempt to drive up competition in the generics market is potentially embarrassing for the government, as prosecutions are shortly expected in pricing fraud cases involving a number of generics manufacturers in the UK. Meanwhile, the complexities of the country's US$7.6bn generics market are likely to remain lucrative for manufacturers.