Brand-name drugmaker tactic ‘product hopping’ costs US healthcare system $4.7 billion annually, study says

An anti-competitive tactic used by brand-name drugmakers called product hopping costs the U.S. healthcare system at least $4.7 billion annually, according to a study from Matrix Global Advisors. 

The study — released Sept. 1 from the Washington, D.C.-based economic policy consulting firm and commissioned by the Coalition for Affordable Prescription Drugs — studied the effects of product hopping on the U.S. healthcare system. 

Product hopping occurs when  a brand-name drugmaker moves patients to a reformulated version of a drug when an existing drug’s patent is set to expire. 

Just five instances of product hopping cost the U.S. healthcare system $4.7 billion annually, the study found. It looked at instances of product hopping for the brand-name drugs Prilosec, TriCor, Suboxone, Doryx and Namenda. 

Brand-name drugmakers use product hopping to preserve monopolies and prevent generic competition, the study said. Generic drug savings can’t be realized if patients have been moved to a drug that is protected by patents before generic competitors can enter the market. 

Find the full study here.

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