Generic vs. Brand Name Drugs – Everything You Need to Know

In 2015, public spending on prescription drugs in Canada hit over $30 billion. However believe it or not, the annual growth rate of drug spending is the second lowest it’s ever been since 1977. The reason behind this is drug patents are expiring like wildfire which means generics are popping up all over the place, eager to have their own presence in the market. This news isn’t exactly sound of music to brand-name drug manufacturers who are going to lose a significant portion of their revenues to competing generics. But it is good news for consumers. With all these options available to the consumer, it’s more important now than ever to educate yourself about the difference between generic drugs and brand name drugs.

Many people get confused when they hear the term, generic drugs and don’t understand how they are different from brand name drugs. Let’s clarify that confusion with an example:

If a pharmacist told you to take some acetaminophen for your migraines and headaches, you might be a little confused. When your head starts pounding, your initial thought is probably to pop a Tylenol and get some sleep. In fact, your local pharmacist was suggesting the same thing but was just referring to a term you were unfamiliar with.

Tylenol is the brand name version of acetaminophen. Whereas most people associate Tylenol with pain reliever, most don’t know what acetaminophen is. There are many generic brands of acetaminophen  available that have the same benefits as its brand name competitor. The medicines, albeit the different names, have the same function which is to relief pain and reduce fevers.

But generic drugs and brand-name drugs must be different right? Why else would they be labelled differently, and have different colours, taste, and textures?  The information below will educate you on this topic and guide you in your future drug purchase decisions.


1. Same Quality

Generic and private label brands are just as rigorously tested and well formulated as brand name drugs.

2. Same Active Ingredient

Active ingredients are the medicinal components of the drug which target the illness or affliction the drug is made to cure. Many generic drugs get their active ingredients from the same supplier as the brand name drug. There are regulations and standards that generic drugs must pass to ensure the drug is bioequivalent to the brand name. This means the generic drug contains the same amount of active ingredient as the brand name. Once in the body, the drug is found in similar levels in the bloodstream and will work the same way as the brand-name drugs.

3. Same Manufacturing Standards

Generic drugs must follow the same good manufacturing practices (GMP) guidelines to ensure consistent production and quality standards are met in order to pass the application process to get market authorization to sell the generic drug in Canada. Health Canada’s Therapeutics Products Directorate (TPD) and the Natural Health Products Directorate (NHPD) are super strict and will only approve generics when it can be proved they are manufactured with the same rigorous standards, identity, quality, purity, and potency as the brand name drug.

4. Same Safety and Efficacy

Before generic drugs are received and authorised for sale by Health Canada, they must be proven safe and effective for the consumer. The active ingredients have to be of the same quality and absorbed by the body in the same way.



1. The Drugs will look different

As a result of using different inactive ingredients and respecting copyright reasons, generic drugs will look different from brand name drugs. Generic drugs will have different names on their bottles.  Inactive ingredients are the non-medicinal components of the drug such as the dyes, flavouring, preservatives, and binding materials. This will result in differences in size, shape, colour, as well as taste.

2. Price Difference

Generic drugs are much more affordable than brand name drugs– sometimes as much as 80% of a price difference compared to  the brand name. Manufacturers of generic drugs don’t have to bear the costs such as research and development, marketing, and advertising that brand names have to carry. They pass off these savings to the consumer by offering generic drugs at a lower price. As an attempt to help recover the development costs, brand name drugs have patents granted to them and are allowed to sell drugs at a higher price. Once the patents expire, other competitors are able to enter the scene and replicate the drug with some alterations without the associated costs.


Myths about Generic Drugs

Myth #1: Cheaper means lower quality

Truth: This is not true about generic drugs. Cheaper prices doesn’t mean lower quality. The best thing about generic drugs is they are made affordable for patients. However, affordability often backfires on generic drugs because consumers associate cheap prices with bad quality. Consumers who are concerned about reduced quality of generic drugs will naturally opt for the brand name drug instead.

Myth #2: Generic drugs take longer to work

Truth: Generic drugs contain the active ingredients as their brand-name alternative. They take the same amount of time to take effect in the consumer’s body.  This false belief originates from the term “generic”  which evokes poor product quality and image in the consumer’s head. When customers buy brand name drugs, they are paying for the trademark and logo that they trust. Studies show that switching from a brand-name drug to a generic form caused consumers to claim the effects of the generic were reduced and took longer to kick in compared to the brand name. In fact, the generic drugs are made with the same potency and efficacy as the brand name drug. Health Canada requires generic products to pass the same quality standards and meet the same exact specifications as any brand name product. What’s really happening is the brand name label creates a placebo effect in the minds of consumers, causing them to think generic drugs are inefficient and ineffective compared to their brand-name competitor.



Not all brand name drugs have alternative generic versions available in the market. Some brand name drugs have running patents that have not yet expired and they are the only option for patients. Some generics contain inactive ingredient variations that a person can have an allergic reaction to. This may make it medically necessary for you to take the brand-name drug. It is recommended to try at least two generic drugs as they contain different inactive ingredients before giving up and going back to the brand name drug.

Whether you’re thinking of going with a generic brand or a well-known brand, always consult with your doctor and pharmacist to find the best option for you.

Apr 05,2016