The pharmaceutical business is a multi-billion-dollar industry, and consistently rated as the most profitable in the world. The industry was recently handed a controversial victory by the Supreme Court — a ruling that may put Americans at risk. The court ruling, Pliva v. Mensing, gives generic manufacturers less liability if their products allegedly cause harm. The average consumer may not know it, but as of 2011, generic drugs and name-brand drugs differ significantly: not in their chemical make-up, but in the legal protections consumers have if something goes wrong. Patients who choose generics — or who have them chosen by their insurance company, pharmacist, or doctor — may unknowingly give up their ability to seek reparations under state law.
To illustrate: two patients walk into a pharmacy and get prescriptions filled for the same ailment. One buys a brand-name drug, the other a generic. Both medicines have identical ingredients, provide the same health benefit, and have labels that match word for word. Unfortunately, both patients suffer devastating harm because the labels fail to disclose known serious side effects. Thanks to Pliva v. Mensing, one patient can seek legal remedy to recover expensive costs. The other, the one who bought a generic pharmaceutical, cannot.Generics have been promoted by government policy over the last three decades as a way to improve the health of Americans by reducing the costs of prescription drugs. Indeed, when a generic is available, today consumers will buy it 90 percent of the time. Overall, more than 75 percent of all drugs sold in the US are now generic.
It’s been almost 30 years since Congress streamlined the drug approval process in an effort to bring generic drugs to market quickly after the brand-name patents expired. The goal was to give consumers the same health benefits at a much lower cost. With regulatory relief and increased competition, generics became wildly successful. The generic pharmaceutical industry, consumers, the health care industry, and taxpayers all benefited. Pliva v. Mensing, however, now casts a shadow over the financial savings of generics. The economic benefits of generics may now be outweighed by the legal risks, at least for those unfortunate consumers who are harmed by prescription generic drugs.
The controversial five-to-four decision overturned two circuit court cases. Now that 7 out of every 10 drugs sold is a generic, Pliva v. Mensing effectively means that 7 out of 10 consumers may lack legal remedy. Any immunity granted by the ruling could increase the number of patients who actually suffer harm, because now generic pharmaceutical companies have less incentive to police themselves and the highly profitable products they sell.