Gladwell on Brand Name and Generic Drugs

Malcolm Gladwell, doesn't blog often, but when he does he usually has something good to say. Another nice post, on an important topic. Make sure you read the comments:

The New York Times led its business section today with the headline: “Drug Prices Up Sharply.” The subject of the piece was a study by AARP showing that prices of prescription drugs rose 3.9 percent in the first three months of this year, four times the rate of inflation. Outrageous!

But wait: it isn’t until you read a little closer that you realize that the price increase just refers to brand-name pharmaceutical prices. And what the article never mentions at all is that the AARP released a second study yesterday, showing that generic drug costs in the

United States were unchanged in the first quarter and fell 0.1 percent over the past year. Here is the key paragraph from the AARP report, which—unbelievably—never made it into the Times piece:

"The rate of increase in average annual change in manufacturer’s list price for generic prescription drugs most widely used by older Americans was about one quarter the rate of general inflation for 2005.”

Now why would the Times ignore lower generic drug prices and highlight higher brand name drug prices? I have no idea. But it drives me crazy, because this kind of reporting reinforces the notion (perpetuated, among others, by big Pharma,) that there is some magical distinction between brand name and generic drugs. There isn’t. Drugs are drugs. And these days, in most of the major therapeutic categories, there is a perfectly acceptable and much cheaper generic substitute available. And the real news from yesterday is not bad news, but good news.