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Innovation Surcharge to Fund Repurposing of Generic Drugs

A Viewpoint author proposes an “innovation surcharge” to counteract the impact on innovation and drug development of the shift toward generic drug use. “An innovation surcharge on generic drugs would hit 3 important targets,” writes the author. “First, it would broaden the funding base for pharmaceutical research and thereby spread the burden from the small number of sick patients who use specialty drugs, and the insurers who cover them, to include the large number of comparatively healthy consumers who use generic drugs, and thereby to the whole insurance sector. Second, revenues from the innovation surcharge would supplement the budgets of the NIH and the [Advanced Research Projects Agency for Health] and would help sustain investment in the face of continued generic substitution. Third, a modest surcharge on generic drugs could supercharge the most neglected part of the pharmaceutical innovation—the repurposing of drugs that have already met the FDA’s safety and efficacy standards for at least 1 indication, have a history of safe use under real-world conditions, and offer the promise of expanding the FDA-authorized options for patients who have conditions that to date have few affordable therapies.”

Source: JAMA