How Does a Generic Drug Get Approved?

Generic drugs are cost-effective because the costs of research and development and drug discovery are not involved since the generic manufacturer can depend on the clinical data submitted by the innovator drug company for the medicine's safety profile.

Generic drugs are prescription medications that have the same active ingredients as their brand-name counterparts. They are expected to work like brand-name drugs in dosage, strength and performance, and must meet the same quality and safety standards. 

When patent protection for a drug with a brand name expires, the U.S. Food and Drug Administration (FDA) can approve a generic version of it for sale. The patent protection for a brand-name drug is usually 20 years from the date of the submission of the patent.

• Because generic drug manufacturers don’t develop a drug from scratch, the costs to bring it to the market are lower.
• On average, the cost of a generic drug is 80 to 85 percent lower than the brand-name drug.
  • Generic drugs save consumers an average of $8 to $10 billion a year at retail pharmacies.
  • Even more, billions are saved when hospitals use generics.
• Not all brand-name drugs have a generic counterpart.
• Drug companies can introduce generic versions only after they have been thoroughly tested by the manufacturer and approved by the U.S. FDA.

The U.S. Food and Drug Administration (FDA) approval process for bringing a new pharmaceutical to market can span anywhere from 5 to 20 years. The process begins with: 

1. Preclinical research
2. Filing an investigational new drug (IND) application to initiate clinical trials examining efficacy and safety in humans
3. Seeking regulatory approval with a new drug application (NDA)

Preclinical testing

• During this phase of research, the toxicity, pharmacokinetics and metabolism of the compound are explored.
• Drug properties, such as chemical makeup, stability and solubility, are established.

Investigational New Drug Application (IND)

• After the preclinical research, the company submits an IND application.
• The document covers all knowledge of the compound to date (drug manufacturing characteristics, chemical composition and behavior) and details of the intended plan for human trials.

Clinical trials

There are four phases here:

1. Phase I: This involves about 20 to 100 volunteers or people with the target disease state.
   • This lasts over several months of targeted study, aiming to determine the safe acceptable dosages of the new drug.
   • Approximately 70 percent of drugs submitted for human trials will pass.
2. Phase II: This involves a few dozen to 300 people.
   • This phase aims to determine the efficacy of the proposed medication and establish a list of side effects resulting from its administration.
   • The duration of this phase is between several months to up to two years.
   • Only 33 percent of drugs will pass.
3. Phase III: Large-scale effort involving several thousand volunteers with the clinical condition the drug is aimed at treating.
   • The purpose here is the continued review of the drug's safety and efficacy.
4. Phase IV: Participants are usually between 300 and 3000 volunteers who have been diagnosed with the condition targeted by the drug.
   • The purpose is to further establish efficacy and monitor adverse reactions associated with drug use.
   • Screening is more stringent and only about 20 to 25 percent of drugs, which enter phase III trials, will move on to this next phase of clinical testing.

NDA application

• The FDA review teams submit evaluation reports with recommendations to the FDA’s administrative department (the administrative body responsible for approving or rejecting the NDA).

Drug labeling

• The FDA will also review the labeling and packaging of a potential new drug to ensure appropriate and accurate information is being communicated to both healthcare personnel and regular customers.

Facility inspection

• An FDA team visits the site where the drug will be manufactured to inspect the production facilities.
• This is a routine part of the drug approval process.

After fulfilling all these steps, the FDA approves the drug.