An Economic Evaluation of Generic Drug Entries in Turkish Pharmaceutical Market

Abstract

Background:The widespread use of generic medicines in Turkey will reduce pressure on the budgetary burden resulting from new treatments and facilitate access for more patients. Therefore, it is important to analyze the effects of the new generic drugs on the equivalent market in Turkey. The objective of the paper is to study the effects of generic entry on the price of the original drug and show the generic competition with increased number of generic drugs in Turkish Pharmaceutical Market. Materials and Methods:We evaluated 46 equivalent groups and 256 medicines. We assessed the groups that generic equivalents of original products market entry after January 2007 for ten years period in Turkey. Unit prices (TL) were calculated with using monthly sales (TL) and monthly unit sales quantities obtained from Quintiles and Intercontinental Marketing Statistics database. In order to calculate the generic market entry effect in each generic equivalent group, we calculated the 12-month average unit price of original drug before first generic entry and we calculated the 12-month average unit price of original drug after the first generic entry. Results:We observed that in this study, 39 original products average prices decrease was 25.85% [standard deviation (SD±10.2%) and 10 products average price increase was 5.59% (SD±6.3) when a generic medicine first appeared in the market. On the evaluated equivalent groups, the original drug prices were significantly decreased when the generic drugs entered to the market. Conclusion:This paper concerns the impact of generic competition on the market unit price ratio of original drugs and has shown that the effects of new generic entrance to market on original drug unit price are significant and enduring. But this effect ends with the entry of 6 th generic drug. Therefore, if there are more than 6 generics there will be no more price drops.