Cheaper Zocor throws generic market a curveball

Employee Benefit News, September, 2006 by Chris Silva

A recent policy change by Merck to offer greater discounts for its cholesterol-lowering drug Zocor has employers, pharmacy benefit managers and insurers faced with making a tough decision: Should they follow what has been general tradition to this point and offer generic versions (simvastatin) at the lowest discounts to their customers, or should they instead buck conventional thinking and offer brand-name Zocor at the lowest costs? Industry experts say employers should pay astute attention to the pricing methodologies of Zocor and simvastatin and ensure they know through their PBM what their net gain is, if any.

The predicament started June 23 when Merck's primary U.S. patent on Zocor expired, thereby granting Ranbaxy Laboratories and Teva Pharmaceutical Industries approval from the Food and Drug Administration to manufacture and sell generic simvastatin for a period of 180 days of exclusivity. When the exclusivity period expires in December, all generic firms and mail-order ...