Authorized to Compete: Shifting Competitive Strategies Require a Fresh Look at Authorized Generics

Authorized generic (AG) drugs have existed for more than 40 years and have long been utilized as a life-cycle management strategy by manufacturers to compete with generics.

More recently, however, brand manufacturers are increasingly using AGs to compete with other brands as well. Shifts in contracting and rebate dynamics have made AGs a cornerstone of a “dual strategy” by which manufacturers attempt to capture and retain market share.

This new trend creates the need for complementary strategies on the part of payers and PBMs to preemptively manage AGs. Likewise, manufacturers should fully understand the factors impacting payer management of AGs in order to maximize their success.