Emily Cuddy (Duke): Quality in the Generic Drug Market
Abstract: This paper examines whether generic drug quality differs across manufacturers in ways that matter for patient outcomes. We leverage pharmacy-level inventory dynamics as a source of plausibly exogenous variation in manufacturer assignment and compare outcomes (i) across patients who initiate the same drug but receive it from different manufacturers and (ii) within patients who switch manufacturers of the same drug when refilling at the same pharmacy. Using administrative medical and pharmacy claims from a large national insurer between 2011 and 2019 and focusing on antidepressants, preliminary evidence suggests economically meaningful differences across manufacturers in early treatment adherence, as well as in subsequent health care utilization and spending. These findings highlight potential limits of current regulatory standards in ensuring generic drug quality.
Economics
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