Researchers at the David Geffen School of Medicine at the University of California, Los Angeles (UCLA) used 2007 data to identify 50 common medications prescribed in a large Medicare Part D health plan. About 30 of these medications were identified as having either a generic substitute or a less expensive therapeutic substitute.

Therapeutic substitution is based on the assumption that drugs within the same therapeutic class are medically interchangeable because their mechanisms of action do not differ significantly, even though they are not chemically the same.

The results showed that for patients receiving a Medicare subsidy generics substitution would save the government an average of US$156 per year. For therapeutic substitutions in subsidized patients the government would save on average US$126 per year and the health plan would save US$305 per year.

Patients not receiving the low-income subsidy would save US$138 per year for each generics substitution. For each therapeutic substitution, each patient would save, on average, US$113 per year and the health plan would save US$276 per year.

Overall, generics substitutions resulted in annual savings of US$127–US$160 per beneficiary, while therapeutic substitutions had the potential to reduce annual costs by US$389–US$452.

‘In other words, therapeutic drug substitutions could result in two to three times greater annual cost savings than possible generic[s] substitutions,’ according to lead author Mr Kenrik Duru.

Reference

1.  Duru OK, Ettner SL, Turk N, Mangione CM, Brown AF, Fu J, et al. Potential savings associated with drug substitution in Medicare Part D: the Translating Research Into Action for Diabetes (TRIAD) Study. J Gen Intern Med. 2013; Aug 22 [Epub ahead of print]

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