Definition - What does Generic Drug mean?
A generic drug is a drug that is similar or identical to a brand-name product in terms of its:
- Administration method
- Intended uses
Generic drugs are usually marketed under their chemical name, rather than a company brand.
Generic drugs are generally less expensive than their band-name counterparts, and many insurers will encourage their policyholders to purchase them as a way of reducing costs.
Insuranceopedia explains Generic Drug
Generic drugs offer greater access to healthcare for consumers. They are essentially copies of branded pharmaceutical products and contain the same active ingredients but are available at a lower cost.
While generic drugs are not linked to a particular company, they are still subject to government regulations in the countries where they are dispensed. They must be labeled with the name of the manufacturer, as well as a generic, non-proprietary name.
Typically, generic drugs must pass preliminary tests and get approval by the FDA before being made available to consumers.
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