DURHAM, N.C. - Generic versions of a class of medicines called "biologics" would not be significantly cheaper than brand-name versions of the medicines, according to research from professors at Duke University's Fuqua School of Business.

Biologics are drugs, vaccines and other medicines produced by living cells in controlled circumstances. The way they are made differs from traditional pharmaceutical drugs that are produced by industrial-scale chemistry.

Insulin is a common biologic prescribed to treat diabetes; other biologics treat arthritis, cancer and other diseases.

The Food and Drug Administration currently does not have a process for the review and approval of generic versions of biologic products, several of which are scheduled to lose their patent protection this year.

"Congress and the FDA are currently addressing this issue and developing a process for the oversight of generic biologics, partially in hopes of generating significant cost savings for consumers and insurers," said Kevin Schulman, a professor of medicine and business administration and director of Duke's Health Sector Management program.

"However, our research indicates that any savings to be expected from the addition of generic biologics to the marketplace will be significantly less than the savings generally available from generic pharmaceuticals," Schulman said.

The manufacture of biologics by living organisms through a process that resembles fermentation must be closely monitored to ensure that the final products meet quality and safety standards.

"Our calculations indicate that policy-makers should not assume significant price reductions from generic biologics," said Henry Grabowski, a professor of economics and director of Duke's Program in Pharmaceuticals and Health Economics. "If the discount is small, and patients are achieving good outcomes with the branded product, then generics might get only a small market
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Contact: Laura Brinn
laura.brinn@duke.edu
919-660-2903
Duke University
1-May-2007