Might sound like a loaded question, but hear me out.
In the Good ol’ USA, generic drugs are required by the FDA to have the exact same make up as the name brand drug (ie. Benadryl vs generic Diphenhydramine). I’d imagine this is also a requirement in other countries.
So how exactly do those companies turn a profit when a generic version of their drug can swoop in and undercut them?
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For some people the name brand drugs do work better for no other reason than the taker believes they are better. The placebo effect is awesome but weird. So what I’m saying is that those who will pay more for their drugs will likely get a better result by paying more for their drugs.
You get 20 years exclusivity before other companies can make your generic molecule.
Then there’s a process called evergreening, where just at the end of the patent, say 17 years in, the company will unveil a new version of the drug, say a prolonged release version or some other feature that trumps the original in some way. Then everyone who’s on that drug e.g. Cardura (doxazosin), who’d normally be switching to a cheaper generic doxazosin once the 20 year patent expires, is tempted to switch instead to Cardura XL – which the manufacturers can patent for another 20 years, and let the generics try and compete with their inferior original product
One the one hand, it’s scummy profiteering, on the other hand, if drug companies couldn’t make profit there’d be no incentive for anyone to do the decades of research needed to develop a new drug.
And for every drug that makes it to market and is profitable, there’s 3 or 4 that don’t take make a profit, and hundreds or thousands of molecules that you might sink years of research into and spend millions on only to find they have no medical use at all, or like Vioxx or thalidomide the side effects were worse than initially feared
Plot twist: often times those “generic” brands are actually owned by the same company. They change the packaging and the look of the pill, but you money is going to the exact same people it was before. It’s the same concept of Ticketmaster also owning the scalping sites.
Brand name drugs hold a patent for 20 years before e the formula can go generic, which allows many years of profits before those get eroded by generic versions.
people usually think the more expensive variant of a thing is better. especially when they see advertisements for it, which many brands have used very successfully.
People are not rational consumers. Most people will pick a heavily-advertised brand over a generic because they recognize the name, and will pick a more expensive product over a cheaper version of the exact same thing because they assume the more expensive one is higher quality.
None of that makes sense, but there’s no rule that people need to make sense.
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