Generic drugs are one of the most reliable ways to decrease US prescription drug prices. Once several generics compete, prices can fall by 80 percent or more compared with the brand price. But brand-name manufacturers use a range of tactics to keep generics out of the market, holding prices high for months or years. This report reviews the evidence on seven of these anticompetitive tactics, their costs to patients and payers, and the reforms the research supports.

Why This Matters

Prescription drugs account for about 16 percent of national health spending. Generic medicines fill roughly 90 percent of US prescriptions but represent only about 12 percent of drug spending. Delays in generic entry preserve brand-only prices and keep costs high for patients, employers, and public programs such as Medicare and Medicaid. Higher out-of-pocket costs can lead some patients to skip doses. Lawmakers, regulators, and payers working to lower drug prices can use this evidence to identify where current policy falls short and which reforms address multiple tactics at once.

What We Found

Manufacturers use seven main tactics to delay generic competition. Many are legal on their own and cause only a modest delay in isolation. Used together, however, they can postpone generic competition for years and add billions in excess spending. The seven tactics are the following:

1. Patent thickets stack secondary patents on features such as drug coatings or dosing, which can create years of additional litigation for generic competitors. For four top-selling drugs, these delays added an estimated $3.5 billion in excess costs for commercial and Medicare payers over the two years following generic entry, based on spending from 2011 to 2021.
2. Product hopping occurs when a manufacturer transitions patients from a brand-name drug to a modestly reformulated version before generics of the original reach the market. One switch, involving the multiple sclerosis drug Copaxone, delayed price competition by 2.5 years and was tied to $4.3 to $6.5 billion in excess spending across US payers from 2015 to 2017.
3. Pay-for-delay settlements compensate a generic company to drop its patent challenge and delay entry. More than one in four of 64 recent settlements showed evidence of these payments, at an estimated cost of about $12 billion a year from 2014 to 2023.
4. Sample denial occurs when brand manufacturers invoke restricted-distribution rules to withhold drug samples needed for FDA-required bioequivalence testing, delaying or discouraging generic development. 
5. Parking of 180-day exclusivity allows a first-filing generic to withhold launch after winning FDA approval and "park" its 180-day exclusivity, blocking all other approved generics until a later settlement date.
6. Authorized generics allow a brand manufacturer to market its own product under a generic label or use the threat of doing so in settlement negotiations, which can delay independent generic competition.
7. Citizen petitions can delay generic approval by requiring FDA review of petitions filed late in the approval process.

These and the other four tactics detailed in the report reinforce one another, so narrow fixes tend to shift the problem rather than end it. The report describes a set of reforms, several reaching more than one tactic, that could be enacted as a package. For example, a legal rule treating a brand's payment for delayed generic entry as anticompetitive unless the companies prove otherwise deters pay-for-delay and other tactics. Congress could curb patent thickets by capping the related patents a brand enforces against a generic. And product hopping could be checked by legislation authorizing Federal Trade Commission challenges to anticompetitive switches.

How We Did It

We conducted a rapid review of research on small-molecule, or nonbiologic, drugs in the US market. Between January and March 2025, we searched three research platforms and screened 196 records, of which 150 met the inclusion criteria. We prioritized peer-reviewed and government studies published in 2019 or later, assessed each study's quality, and synthesized the evidence tactic by tactic. AI tools supported the literature identification and summarization, and the authors verified all findings against the primary sources.