Current Generics Utilization and Associated Savings in Saudi Arabia: Insights From a Private Claims Database

Area of Science:

• Health Economics
• Pharmaceutical Policy
• Public Health

Background:

• Generic substitution is a key strategy for enhancing healthcare access and reducing costs.
• The Council of Health Insurance (CHI) in Saudi Arabia implemented a policy (circular N°289) to promote generic drug utilization.
• There was a lack of data on the impact of this specific policy on medication use and financial outcomes.

Purpose of the Study:

• To analyze the impact of CHI circular N°289 on medication utilization and financial outcomes in Saudi Arabia.
• To assess trends in generic utilization rates and associated cost savings.
• To evaluate the usage of local versus imported generic brands and overall pharmaceutical utilization patterns.

Main Methods:

• A 10-month retrospective observational study (September 2022-June 2023) was conducted.
• Monthly aggregate data from the National Public Health Information Exchange System were analyzed.
• Generic utilization and spending rates, cost savings, and local generic uptake were calculated, with comparisons to 2019 data.

Main Results:

• Generic utilization increased from 70% to 76%, and spending rose from 38% to 44%.
• Local generics accounted for the largest share of utilization (45%), surpassing imported generics (30%) and brands (25%).
• Approximately 330 million Saudi Riyal in savings were realized over 10 months, with potential savings of 228 million Saudi Riyal.

Conclusions:

• The CHI circular N°289 effectively promoted generic medication use.
• The observed increase in generic utilization is consistent with international trends and is expected to persist.
• The policy has demonstrated significant financial benefits and a positive shift towards local generic options.