Generic ARBs: Effectiveness Does Not Always Equal Success

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As more angiotensin receptor blockers come off patent, it will be interesting to see how manufacturers, payers, and physicians react.

This article originally appeared online at DrPullen.com, part of the HCPLive network.

A few months ago I posted when the first generic ARB (angiotensin receptor blocker) became available. Generic losartan, the generic for Cozaar and Hyzaar (combo med with hydrochlorothiazide), became available in May 2010. Interestingly it has not made much for inroads in the ARB market.

As you may recall, the angiotensin receptor blockers are akin to the angiotensin converting enzyme inhibitors. (ACE Inhibitors) and are used for the treatment of hypertension, congestive heart failure, and for renal protection in patients with diabetes and other causes of renal insufficiency. The ACE inhibitors work in the lungs to inhibit or block the conversion of angiotensin 1 to angiotensin 2, and have a side effect of a dry, hacking refractory cough in some patients. Although the ARBs came to market a few years after the ACE inhibitors, and so are just now coming off patent, they still are a huge selling drug. Cozaar was the first of the ARBs to market and so is the first generic. As subsequent ARBs became available there was a widespread belief among providers that Cozaar was not as effective at treating hypertension as most of the other ARBs.

There has not really been much at all in head-to-head comparison of the ARBs, and so this lack of confidence in valsartan is largely anecdotal, but it has been my experience as well as the experience of many of the doctors I’ve talked to about this. The original article was picked up by KevinMD and many of the comments on his site by physicians also implied that the med was not felt to be close to “best in class.”

It appears that for one reason or another many insurers also don’t feel valsartan is best for their patients. Despite its generic status, with significant savings in drug cost, it is not on the lower tier copayment for several of the larger insurers in our area. I’m not sure if this is because the insurers have been able to negotiate great rates for other drugs in this highly competitive market, or because they really believe the branded drugs are enough better to save them money in reduced hospitalizations for congestive heart failure (CHF Treatment). I cynically suspect they get great discounts from the makers of Benicar, Atacand, Micardis, and Avapro. Diovan (generic name valsartan), which is going to be the next ARB to go generic (probably sometime next year) and which is generally felt to be a good effective drug, is not on many of the plans at the lower tier either. I suspect this is because of the short duration of its remaining patent time the drug company that markets Diovan has calculated that gaining market share for the short time left of their patent is not going to be as profitable as getting paid more for a smaller market share in the limited time available.

This is one way to think about this strategy, given that it’s not easy to get well-controlled chronic disease patients off expensive drugs and onto different drugs when they become less expensive. One year of Diovan at $85 / month = $1020. (Costco Price)

Five years of Brand X ARB at $50 / month = $3000. (A guess at a discounted price to insurers for the low bidder on ARBs.)

If the actual cost to manufacture a drug is inconsequential, then a steep discounted drug does much better if it gets a large market share. This gamble is more likely to pay off if the patient stays on the drug for several years, whereas for a shorter timeframe keeping the price high may lead to higher profits. Pharma knows that once the drug goes generic their profits will disappear, as it is easy to get patients to switch to the identical drug as a generic, but much harder to get them to switch to an alternative drug in the same class.

I suspect when valsartan goes generic it will quickly gain a large share of the ARB market. Stay tuned. We’ll see.

Ed Pullen, MD, is a board-certified family physician practicing in Puyallup, WA. He blogs at DrPullen.com — A Medical Bog for the Informed Patient.