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Related Concept Videos

Pharmaceutical Alternatives: Stability-Related Therapeutic Nonequivalence01:22

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Generic intravenous (IV) drugs are considered bioequivalent to their branded counterparts due to their 100% bioavailability upon administration. However, variations in stability among different drug products can significantly influence their therapeutic performance, even if they are pharmaceutically equivalent.Cefuroxime, a prophylactic antimicrobial, is often used as a single-dose IV injection for patients undergoing coronary artery bypass grafting surgery. A 3 g dose typically provides...
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During the development of a new pharmaceutical, the manufacturer initially assigns a code name to the drug. Once approved, the drug receives a United States Adopted Name (USAN)—a generic, nonproprietary designation. Upon being listed in the United States Pharmacopeia, this nonproprietary name becomes the drug's official name. Additionally, the manufacturer assigns a proprietary name or trademark, which serves as the brand name under which the drug is marketed. It is worth noting that...
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Pharmaceutical equivalents, by definition, are drug products with the same active ingredient in the same quantities, encapsulated in identical dosage forms, and intended for the same administration routes. These pharmaceutical equivalents are deemed bioequivalent if the bioavailability of the active entity in the drug preparations is similar. Moreover, pharmaceutical equivalents demonstrating bioequivalence are also regarded as therapeutically equivalent. This means that when used as directed,...
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The concept of therapeutic equivalence (TE) in drugs with multiple indications is complex. A generic drug may be therapeutically equivalent to a brand-name product for one specific indication, but this doesn't necessarily mean it's equivalent for all other indications. Evidence of TE in one patient group and bioequivalence shown in healthy volunteers can support—but not confirm—TE for other indications. However, definitive proof requires individual clinical studies for each...
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Drug Products: Biologics, Biosimilars and Interchangeables01:28

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Biologics, derived from living sources such as humans, animals, or microorganisms, represent a significant category of pharmaceuticals. These complex molecules, developed through advanced biotechnological methods or purified from natural sources, include essential medical treatments like insulin and growth hormones. The complexity of biologics arises from their large molecular structures and the intricate processes required for their production, making them distinct from conventional...
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Dosage Regimen: Individualization01:24

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Individualization in dosing regimens is the customization of medication doses for individual patients. Its necessity arises from the goal of maximizing therapeutic benefits while minimizing risks. This approach is pivotal because human responses to drugs can vary widely; what is effective for one person may be inadequate or excessive for another. Interpatient (intersubject) variability refers to differences in drug responses between individuals, while intrapatient (intrasubject) variability...
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Drug Repurposing Hypothesis Generation Using the "RE:fine Drugs" System
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Reference pricing with endogenous generic entry.

Kurt R Brekke1, Chiara Canta1, Odd Rune Straume2

  • 1Department of Economics, Norwegian School of Economics (NHH), Helleveien 30, N-5045 Bergen, Norway.

Journal of Health Economics
|June 29, 2016
PubMed
Summary
This summary is machine-generated.

Reference pricing aims to lower drug costs but may backfire. It can discourage generic competition by making brand-name drugs cheaper, though price caps might encourage generic entry.

Keywords:
Brand-biased consumersDrug expendituresGeneric entryPharmaceuticalsReimbursement schemes

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Area of Science:

  • Health Economics
  • Pharmaceutical Policy
  • Market Competition

Background:

  • Reference pricing aims to control pharmaceutical expenditures.
  • It seeks to enhance demand elasticity and promote generic competition.
  • Existing policies have yielded mixed empirical results.

Purpose of the Study:

  • To model the impact of reference pricing on pharmaceutical markets.
  • To analyze its effects on generic entry and brand-name pricing strategies.
  • To compare reference pricing with coinsurance and evaluate welfare implications.

Main Methods:

  • Development of a novel economic model.
  • Analysis of a market with brand-biased and brand-neutral consumers.
  • Price competition between a brand-name producer and multiple generics producers.

Main Results:

  • Reference pricing can discourage generic entry by intensifying brand-name price competition.
  • The net effect on drug prices and expenditures is ambiguous.
  • Under price regulation, reference pricing may stimulate generic entry.
  • Welfare may improve when brand preferences are considered.

Conclusions:

  • Reference pricing's impact on generic entry and drug prices can be counterproductive.
  • Price regulation can alter reference pricing's effect on generic entry.
  • Policy implications are nuanced, requiring consideration of consumer behavior and regulatory environments.