Study: Generic drugs could offer significant Medicaid savings

A new study from the Generic Pharmaceutical Association found that every 2-percent increase in substitution of generic drugs saves Medicaid $1 billion a year (Source: “GPhA Report: Generics Offer Big Medicaid Savings Opportunity,” Wall Street Journal Health Blog, July 26, 2010).

Furthermore, “Savings Achieved Through the Use of Generic Pharmaceuticals, 2000-2009” (pdf, 9 pages) found that the generic utilization rate in Medicaid is about 64 percent, more than 10 percentage points lower than the general population, which means significant savings are realistic, the study authors contend.