A comparative analysis of generics markets in five European countries

A generic medicine is a faithful copy of a mature drug--no longer under patent marketed with the chemical name of the active ingredient. This article analyses generics markets in five European countries: France, Germany Italy, The Netherlands and the U.K. The study investigate all the main issues--patent, approval to market, pricing and reimbursement, prescription and distribution--which affect the life cycle of a pharmaceutical product. The situation in the five countries varied widely. Because of European harmonization, patent legislation and approval procedures no longer affect much the development of generics. Only national legislation on patent protection approved before the EU directive came into force still plays a role. Approval differences seem to be due mainly to common practice, rather than to the regulations themselves. None of the countries have an efficient public information system on patent expiry. Generics have had more success in countries with more flexible pricing policies. Reimbursement has not yet been used widely to discriminate between generics and proprietary drugs. Financial incentives are based more on physicians' prescribing behaviour than on pharmacists. The freedom of pharmacy ownership and the consequent possibility of dispensing pharmaceuticals through different channels affects dramatically the structure of generics markets. A free market of wholesalers and retailers can enhance a comparative market, through horizontal and vertical integration all along the distribution chain. Such an environment has stimulate the success of unbranded generics by delegating strong purchasing power to distributors.