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Generic vs. brand-name drugs: What’s the difference?

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Generics vs. brandsBenefits and disadvantagesExamplesTakeaway
Both generic and brand-name drugs contain the same active ingredient. But generic medications are typically significantly cheaper than the brand-name version.
Medically reviewed by Alisha D. Sellers, BS Pharmacy, PharmD
Updated on November 6, 2023

Generic drugs must meet strict medical standards before receiving approval from the Food and Drug Administration (FDA). The FDA specifies that generic drugs must have the same strength, quality, stability, and purity as the brand-name version.

But not every brand-name medication is available as a less expensive generic. This is because medical companies can typically develop a generic version only when a brand-name drug’s patent expires.

Knowing more about the side effects, cost, and effectiveness of generic vs. branded drugs, as well as their key similarities and differences, can help you feel more informed about your treatment.

Generic vs. brands: What’s the difference?

A person speaking with a pharmacist about generic vs. branded drugs.
Photography by Maskot/Getty Images

Generic and brand-name medications work in the same way, according to the FDA. This is because both generic and brand-name drugs contain the same active ingredient. (An active ingredient is what makes a drug work.) Plus, they both have the same quality, strength, method of administration, and dosage.

Generic medications and brand-name drugs can treat a health condition in an identical way, producing the same clinical benefit and outcome. This makes generic drugs equal substitutes for their brand-name counterparts.

Side effects

Because the active ingredient in brand-name and generic medications is the same, and because they have the same purity and dosage, both types of medications have the same risk of side effects. You should typically experience similar side effects regardless of which form of medication you take.

Both generic and brand-name drugs may contain some inactive ingredients, such as fillers or dyes. But they might differ in exactly what inactive ingredients they contain. Certain ingredients might cause a small additional risk of developing side effects.

That said, drug companies must provide documentation to the FDA to prove that any inactive ingredient in their drug is safe.


Generic medications and brand-name drugs have the same effectiveness. To get FDA approval, medical companies must prove that the generic drug they produce can offer the same clinical benefits and that it can be an effective substitute for the brand-name version.

A 2019 study found that generic drugs and their brand-name counterparts offered comparable clinical outcomes when treating several health conditions.


Generic drugs typically are significantly cheaper than brand-name medications.

This is because drug companies that first develop a new brand-name medication have to perform numerous expensive tests to prove its effectiveness and safety. The drug price then reflects this.

According to the FDA, generic drugs may be about 80-85% cheaper than their brand-name counterparts. A 2020 report stated that generic drugs helped save around $313 billion in 2019 and about $2.2 trillion over the last decade.

Generic medications are very popular, and generic drug options are typically available for the majority of prescriptions in the United States. But certain medications may be available only in their brand-name form.

If you’re looking to save money on your prescription medications, some websites, including Optum Perks, provide discount cards and drug coupons on both generic and brand-name medications.

Benefits and disadvantages

According to the FDA, generic drugs are equal to their brand-name counterparts in dosage, safety, strength, method of administration, and therapeutic effect.

In general, generic drugs are also more affordable than brand-name medications, making them more and more popular in treating several health conditions, such as diabetes, cancer, and heart disease.

Yet both brand-name and generic medications may have several benefits and disadvantages that you may want to consider before choosing which type of over-the-counter drug to buy.

Also, knowing the benefits and disadvantages of each can help you have a conversation with your doctor about which version of a medication may be best for your condition.


Here are some benefits and disadvantages that generic medications may have:

BenefitsCost: Generic drugs are typically cheaper than their brand-name counterparts. According to the FDA, generic drugs can cost around 80-85% less than brand-name medications.

FDA-approved: Branded and generic medicines have the same FDA standards and have to pass the same tests before being available on the market.

Availability: Generic medications are widely available as many manufacturers have access to the active ingredients necessary to produce drugs.

Quality: Generic drugs are copies of their branded counterparts.
DisadvantagesAbsorption rate: In some rare cases, some people may not absorb generic drugs as efficiently as branded medicines. This may be due to several factors, including inactive ingredients in the drug or coating.

Appearance: Generic drugs do not typically have a branded look, so it may be easier to mix up tablets and capsules of different medications.

Drug type: In some rare cases, doctors may consider not using generic drugs to treat conditions in which even a tiny difference in the drug’s formulation may cause a reaction. In particular, doctors may not advise generic medications for drugs having a narrow therapeutic index (NTI), such as lithium or blood thinners.
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Brand names

Here are some benefits and disadvantages that brand-name drugs may have:

BenefitsPioneer drug: Brand-name medicines are typically the first version of a drug on the market. This means that a brand-name drug has undergone vigorous and strict testing to ensure its safety and efficacy.

Absorption rate: In some cases, people may absorb branded drugs better than their generic counterparts.
DisadvantagesCost: Branded medicines have often undergone years of research and testing. This makes them more expensive than generic drugs.

Health insurance coverage: Some health insurance policies may not encourage the purchase of branded medicines due to their higher cost when a generic option is available.


Here is a list of generic drugs and their brand-name counterparts:

Generic drugBrand name
montelukast sodiumSingulair
amphetamine dextroamphetamineAdderall
albuterolProAir HFA

If you need help covering the cost of medications, the free Optum Perks Discount Card could help you save up to 80% on prescription drugs. Follow the links on drug names for savings on that medication, or search for a specific drug here.


Generic drugs and brand-name medications contain the same active ingredient. Both options have the same strength, quality, stability, and purity. This ensures that both medications can treat a person in the same way and with the same efficacy.

Generic drugs have to pass several tests before the FDA approves them and they become available on the market. Generic options are also typically cheaper than their branded counterparts, helping people save up to about 85% when compared to branded medication’s prices.

Download the free Optum Perks Discount Card to save up to 80% on some prescription medications.

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