Phentermine FAQs

On average, most generics are about half the price of the brand-name drug; some generics may cost up to two-thirds less than the brand-name version. There are several reasons why generic pharmaceuticals are almost always much less expensive than their brand-name counterparts. First, there is much less money spent advertising, promoting, marketing, researching and developing the generic version of a drug. Second, the profit margins of generic drugs are considerably less than those of their brand-name equivalents. Third, because there are usually several providers of a given generic, competitive pricing often occurs among different generic versions of the same brand-name product.

When a pharmaceutical company develops a new drug they are issued a protective patent which allows them, and only them to manufacture and distribute that particular drug. When the pharmaceutical company launches their new drug they do so using a registered trademark name and build a brand around their product. Once the patent expires other companies have the right to develop their own bioequivalent versions of the same drug but they cannot use the same trademarked name to sell their medication.

It should be pointed out that the initial cost to develop a new drug is extremely high. It might take years for a company to recoup its research and development expenses. Thus, although a patent is issued to protect the investment, the research and development costs are sometimes included in the price to the consumer of the brand name drug even though the patent has expired.