AAM Issue Brief: Medicaid Generics Penalty | Association for Accessible Medicines
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AAM Issue Brief: Medicaid Generics Penalty

Costly Consequences: Medicaid Generics Penalty Threatens Patient Access to Affordable Medicine

Starting in 2017, a new penalty is imposed on generic manufacturers participating in the Medicaid program for generic medicines with price increases exceeding the rate of inflation. The Medicaid Generics Penalty is modeled on a fundamentally different market, ignores the differences and highly competitive nature of the generics drug market, unfairly penalizes manufacturers for price fluctuations outside of their control, increases the risk of drug shortages and ultimately threatens the availability of low-cost generics to patients.