2024 U.S. Generic & Biosimilar Medicines Savings Report
AAM’s annual savings report, in partnership with the IQVIA Institute, reveals that the use of Food & Drug Administration (FDA) approved generic and biosimilar medicines created $445 billion in savings in 2023 for patients and the U.S. healthcare system—and over $3 trillion in savings the last ten years. Savings from biosimilar medicines alone increased to $12.4 billion in 2023 and $36 billion since the first biosimilar entry in 2015.
However, the long-term outlook for generic and biosimilar competition hinges on addressing the barriers to development and adoption of these lower-cost medicines. Without action to strengthen generic and biosimilar markets, many lower-cost medicines may disappear and patients will suffer.
On the eve of the 40th anniversary of the Hatch-Waxman Act we stand at a critical crossroads,said David Gaugh, Interim President and CEO of AAM.The sustainability of our industry remains fragile. Policymakers and regulators must address issues that delay generic and biosimilar competition, such as patent thickets, PBM brand drug rebates, interchangeability and inefficient regulatory processes. This report provides a comprehensive review of the current state of our industry—indicating the time for critical action is now.
Patients and the U.S. Healthcare System Saved $445 Billion in 2023
Up from 2022, which found $408 billion in generic and biosimilar savings, this figure indicates continued savings for the U.S. healthcare system—including patients, employers, and taxpayers.
90% of U.S. Prescriptions Filled, 13.1% of Rx Drug Spending
Although generic and biosimilar prescriptions account for 90% of prescriptions filled in the U.S., they account for only 13.1% of the country’s spending on prescription drugs. Generic and biosimilar medicines are the only segment of healthcare that consistently deliver lower costs. And when it comes to overall healthcare spending, generics and biosimilar medicines represent only 1.2% of total spending in the U.S.
$137 Billion in Medicare, $206 Billion in Commercial Health Plan Savings
Generics and biosimilars continue to provide critical savings throughout the healthcare system and are particularly valuable to Medicare, employer-sponsored health insurance and the patients they serve. Despite these savings, many patients are forced to pay too much for their generic prescription.
Biosimilars Have Generated $36 Billion in Savings Since 2015
Since 2015, biosimilars have been used in almost 2.7 billion days of patient therapy with no unique clinical challenges. In fact, biosimilar competition has now supported more than 495 million incremental days of therapy — care that patients would not have received otherwise. Savings are increasing as biosimilar adoption has grown. Sixty percent of total savings from biosimilar entrants has occurred in the past two years, with over $12.4 billion in savings in 2023 alone. However, biosimilar adoption continues to trail expectations because of misaligned incentives and PBM practices that slow adoption.
