Dive Brief:

• The Food and Drug Administration said Thursday it approved a record total of 781 generic drugs during its 2018 fiscal year, up from the previous record of 763 set last year. 
• Within that total, tentative approvals — or an OK granted before patents on a branded drug expire — also increased from 174 in 2017 to 190 in 2018. 
• FDA Commissioner Scott Gottlieb has made speeding up review of generics an agency priority, as a lever to help bring down drug prices. The latest effort to bring more generic competition to the market is a set of guidance documents to "advance the development of generic transdermal and topical delivery systems."

Dive Insight:

Although lacking a mandate over pricing, the FDA has been more active in recent years in using its powers to spur competition and keep drug costs in check.

The agency recently created a list of branded drugs with no generic competition. It also amended the priority review rules for Abbreviated New Drug Applications, allowing a generic to qualify for priority review if there are fewer than three other approved generics and no blocks on patents.

Spending on prescription drugs in 2018 is projected to outpace other healthcare cost growth, rising from a range of $324 billion to $535 billion in 2017 to between $404 billion and $584 billion in 2020, according to a report from the Pew Charitable Trusts.

In August 2018, the FDA approved the first drug under its competitive generic therapy designation, which aims to speed review of generics of products without competition to prevent price hiking of the kind seen with Turing Pharma's off-patent Daraprim (pyrimethamine).

Generic competition has potential to reduce prices through competition, but the real price drops are often seen with a second generic coming to market.

Still, increased approvals don't automatically translate into greater competition, as some estimates hold that more than half of generics may not immediately reach the market.

"[This] means the full benefit of generic competition to help counter increasing brand drug prices is not being realized. …There are a combination of forces that keep generics off the market and out of the hands of patients," said the Association for Accessible Medicines, the generics trade body, in an emailed statement. 

"Policymakers and lawmakers would be well-served to focus their attention and efforts on correcting market and legal imbalances and abuses that are keeping FDA-approved generics off the market," the statement continued.

The FDA is working on this front. In May, the agency announced it would launch a website to put brand managers on notice if they block generic competition.