Generic Purchasing Trends

September 2019 : Generic Drugs - Vol.16 No. 9 - Page #1
Category: Generics Manufacturers

The goal of attaining a consistent supply of bar coded unit dose generic products remains out of reach for many facilities. In response to supply shortfalls, pharmacy must exert significant effort to procure appropriate medications. With frequent source changes for many products, an additional challenge results from the required NDC changes.

To assess hospital pharmacy’s experiences with generic purchasing, PP&P polled a random, nationwide sampling of health system pharmacy directors in the third quarter of 2019. A total of 304 responses were received, yielding a confidence interval of 5.48 (95% +/-5.48). The pages that follow illustrate many trends in hospital pharmacy’s utilization of generic medications, including increasing generic budgets, growing adoption rates for biosimilars, staff expansion to manage ongoing shortages, and more.

While generic price sensitivity is increasing among hospital pharmacy directors, it is important to note the wealth of factors that impact purchasing, including supply reliability, reimbursement, and packaging requirements. A notable issue faced by small facilities concerns packaging size. While it may seem counterintuitive, some are willing to pay more for a smaller package to reduce waste. For example, when only 10 doses are needed, facilities may prefer to pay extra for a 30 count box that requires the wasting of 20 doses, rather than purchasing a less expensive 100 count box, which then requires the wasting of 90 doses.

It is important to consider whether we have reached a tipping point in terms of product sourcing. Pharmacy directors looking for solutions to these long-standing problems have begun to consider solutions outside of the traditional generic pathway with growing interest in the non-profit efforts to create a new source of generic injectables.

For a majority of facilities (64%), price is not always the most important consideration in choosing a generic manufacturer. Yet, it is notable that the number of facilities citing price as the most important consideration has been steadily increasing. Nine years ago, just 22% made all of their generic purchasing decisions based primarily on price; this year 36% of facilities did so.

Pharmacy is increasingly focused on price and a consistently reliable product supply when sourcing generic medications. Notably, this year also saw an increasing emphasis on product quality and manufacturer’s reputation as part of the purchasing process.

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