A generic drug is a drug that has the same active ingredient as the brand name product. Because they have the same active ingredient, generic drugs behave in the same way as brand name equivalents, and can therefore be substituted, or become "interchangeable" with the brand name drug. Generic drugs are the same quality and efficacy as brand name drugs and must meet the same scientific standards as brand name drugs. These standards are set by Health Canada. As part of its approval process, Health Canada declares generic drugs as equivalent to a comparator brand name product.

How the Ministry Reimburses Generic Drugs :
The government reimburses generic drugs at a fixed percentage of 50 per cent of the published Ontario Drug Benefit price of the equivalent brand name product.

Exemptions to the Rules :
The regulations authorize the Executive Officer to negotiate agreements for generic products that are the first products listed on the Formulary. As a result, the Executive Officer has the discretion to consider exceptions to the 50 per cent generic price rule but this cannot be higher than the listed brand comparator.

Highlight

• 90% generic products are priced at 50%; the remaining 10% were negotiated as exceptions to the generic price rule, based on the regulations filed in December 2006 or July 2007.

See also :

• Competitive, Pricing and Listing Agreements Progress
• Expanding Interchangeability and Off-Formulary Interchangeability Progress
• Enforcing Drug Pricing Progress
• Changing Pharmacy Reimbursement Structure Progress
• Alternate Payment Model and Access to Government Stock Progress