On average, prescription drug costs in the U.S. are the highest in the world, but that doesn't mean that there aren't relative bargains to be had.
For example, a recent FDA study shows that generic drugs may in some cases be cheaper in the U.S. than either the brand-name or generic versions of the same drug sold in Canada. Generic drugs account for half of all prescription drugs sold in the U.S.
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"For six of the seven drugs, the U.S. generics were priced lower than the brand-name versions in Canada. Five of the seven U.S. generic drugs were also cheaper than the Canadian generics. Of the remaining two U.S. generic drugs, one (enalapril for high blood pressure) was unavailable in Canada generically, and its Canadian brand-name version was more than five times the price of the U.S. generic equivalent. The other U.S. generic (metformin for type 2 diabetes) sold for less in Canada both as a generic and as a brand name," writes Linda Bren in the July-August 2004 issue of FDA Consumer magazine.
The FDA defines a generic drug as "a copy that is the same as a brand-name drug in dosage, safety, strength, how it is taken, quality, performance, and intended use." Under Federal regulations, generics have to be comparable to the original in all important aspects such as potency, speed of action, duration of drug effect, purity of the compound, and stability (shelf-life).
Generics are cheaper than the originals because the manufacturers don't have the same costs associated with developing and bringing a new drug to market. In addition, because many different manufacturers can produce a generic drug, competition drives the price lower. For example, several different companies in the U.S. and abroad now manufacture the over-the-counter pain reliever ibuprofen, which started life as the prescription drug Motrin. Similarly generic versions of the decongestantpseudoephedrine now crowd drugstore shelves side-by-side with the Sudafed brand.