EP344: The High Cost of Generic Drugs, With Steven Quimby, MD

In Episode 344, Stacey Richter talks with Steven Quimby, MD, author of Billions in Your Generic Drugs, about why generic medications — 90% of all prescriptions written in this country — can still carry surprisingly high prices despite razor-thin costs of goods. Dr. Quimby explains the ongoing generic drug price-collusion lawsuits, why generics and branded generics account for just 19% of invoice-level spending but a full 65% of patient out-of-pocket costs, and why so few patients realize their insurance plan may not actually be offering the lowest price.

WHAT YOU'LL LEARN

✅ Why generic drug manufacturers are facing major price-collusion lawsuits despite having no R&D costs and low costs of goods

✅ Why generics and branded generics represent 19% of invoice-level spending but 65% of patient out-of-pocket costs

✅ Why the generic drug supply chain is so opaque, and why acquisition and sale prices are hard to pin down

✅ Why so many patients don't know their insurance doesn't always offer the lowest generic drug price — and haven't heard of GoodRx or similar tools

✅ Why it matters for prescribers to know a patient's out-of-pocket drug cost at the point of prescribing

WHY THIS MATTERS

Ninety percent of the prescriptions written in this country are for generics — five billion scripts a year — so generic medications touch far more lives than new branded drugs. When the industry is this opaque and nobody can get legitimate acquisition and sale prices, the core question becomes: how can we judge value when we don't know price?

MENTIONED IN THIS EPISODE

AEE13 with Ge Bai, PhD, CPA: Apple Podcasts | Spotify | Other Apps

EP241 with Vinay Patel: Apple Podcasts | Spotify

EP284 with Carm Huntress: Apple Podcasts | Spotify

EP334 with Sunita Desai, PhD: Apple Podcasts | Spotify | Other Apps

=== LINKS ===

🔗 Show Notes with all mentioned links: Episode Page

🔗 Healthcare Industry Acronyms and Terms

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=== CONNECT WITH THE RHV TEAM ===

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00:00 Introduction.

05:54 What are the current lawsuits involved in the generic drug space right now?

06:52 How is price fixing happening in the generic drug space?

07:58 "If I was the major payer for drugs … I'd want to know answers."

08:06 What's the scale on new and generic drugs?

09:02 What's the problem with using price tools for generic drugs?

10:22 "I think right now, virtually everyone should be checking [those sites vs] their insurance price."

10:47 Are payers paying too much for generic drugs?

11:53 Who are these generic manufacturers?

12:10 "They're distinctly different corporations than those that we have called Big Pharma."

13:55 Why is it important to have adequate numbers of manufacturers for generic drugs?

17:03 "We just can't get legitimate acquisition and then sale prices of the actual drugs."

17:17 "The industry's opaque to all of these things."

19:39 "The prices that patients are getting at the prescription counter are so high that some studies say a third of them or more are walking away without buying the drug."

20:02 AEE13 with Ge Bai, PhD, CPA, on the GoodRx model.

20:50 EP241 with Vinay Patel.

22:05 What and who should be on formulary?

26:24 "If they'd give us the numbers, we could see when it happens."

28:58 How can we overcome the challenges of these high generic drug costs?

30:38 EP284 with Carm Huntress.

30:46 EP334 with Sunita Desai, PhD.

31:26 "How can we judge value when we don't know price?"