Overview of Generic Drugs and Drug Naming

ByDaphne E. Smith Marsh, PharmD, BC-ADM, CDCES, University of Illinois at Chicago College of Pharmacy
Reviewed/Revised Apr 2023
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Medications are drugs used therapeutically (that is, to treat medical conditions). Drugs often have several names. When a drug is first discovered, it is given a chemical name, which describes the atomic or molecular structure of the drug. The chemical name is usually too complex and cumbersome for general use. Next, a shorthand version of the chemical name or a code name (such as RU 486) is developed for easy reference among researchers.

When a drug is approved by the Food and Drug Administration (FDA—the U.S. government agency responsible for ensuring that drugs marketed in the United States are safe and effective), it is given a

  • Generic (official) name

  • Brand (proprietary, trademark, or trade) name

The generic name is assigned, in the United States, by an official body—the United States Adopted Names (USAN) Council.

The brand name is developed by the company requesting approval for the drug and identifies it as the exclusive property of that company.

Generic and brand names must be unique to prevent one drug from being mistaken for another when drugs are prescribed and prescriptions are dispensed. To prevent this possible confusion, the FDA must agree to every proposed brand name.

Government officials, doctors, researchers, and others who write about the new compound use the drug’s generic name because it refers to the drug itself, not to a particular company’s brand of the drug or a specific product. However, doctors often use the brand name on prescriptions, because it is easier to remember and doctors usually learn about new drugs by the brand name.

The term generic, when applied to such items as foods and household products, is used to describe a less expensive, sometimes less effective or lower-quality copycat version of a brand-name product. However, generic drugs, although less expensive than the comparable brand-name drug, are generally as effective and of the same quality as the brand-name drug (see Bioequivalence and Interchangeability of Generic Drugs

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Patent Protection for Drugs

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 use, leaving the company only about half of the patent time to exclusively market a new drug. The Food and Drug Administration (FDA) may choose to accelerate the approval process for drugs to treat acquired immunodeficiency syndrome (AIDS), cancer, and other life-threatening disorders when no current effective treatment exists.

After a patent has expired, other companies may produce and sell a generic version of the drug that is approved by the FDA. They typically sell their product at a lower price than the original brand-name drug because the generic manufacturer does not have to recover the original costs of drug development and usually spends much less on marketing. A generic drug may be sold under its generic name or under a brand name (a branded generic drug) but not under the brand 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 brand-name drug. Sometimes the market for the drug is so small that producing another version does not make good business sense.

Nonprescription Generic Drugs

Generic versions of some nonprescription (over-the-counter) drugs are often sold as house brands by drug chains or cooperatives, usually at a lower cost. These drugs are evaluated in the same way that generic prescription drugs are evaluated and must meet the same requirements.

Pharmacists can advise which generic over-the-counter drug products should be as effective as the original. However, a consumer may prefer one product to another because of appearance, taste, consistency, or other characteristics.

More Information

The following English-language resource may be useful. Please note that THE MANUAL is not responsible for the content of this resource.

  1. U.S. Food and Drug Administration: This governmental agency ensures the safety and efficacy of all human and veterinary medications, biological o, and medical devices. It also ensures the safety of the nation's food supply, cosmetics, and radiological products.

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