Patent Protection
In the United States, a company that develops a new drug can be granted a patent for the drug itself, for the way the drug is made, for the way the drug is to be used, and even for the method of delivering and releasing the drug into the bloodstream. Thus, a company often owns more than one patent for a drug. Patents grant the company exclusive rights to a drug for 20 years. Additional patents can sometimes be filed to extend the patent life. Usually, about 10 years elapse between the time a drug is discovered (when the patent is obtained) and the time the drug is approved for human or veterinary use, leaving the company only about half of the patent time to exclusively market a new drug. (The FDA often accelerates the approval of drugs to treat AIDS, cancer, and other life-threatening disorders for which no current treatment exists.)
After a patent has expired, other companies may produce and sell a generic version of the drug, typically at a much lower price than the original trade-name drug. (However, before generic drugs can be marketed, they must be approved by the FDA.) A generic drug may be sold under its generic name or under a trade name (a branded generic drug) but not under the trade name used by the original patent-holder.
Not all off-patent drugs have generic versions; sometimes a drug is too hard to duplicate, or adequate tests are not available to prove that the generic drug acts the same as the trade-name drug. Sometimes the market for the drug is so small that producing another version does not make good business sense.
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