Definition
What Is an Authorized Generic?
Last updated
An authorized generic is a drug marketed and sold as a generic that is actually manufactured under the original brand-name company's own FDA-approved application, using the identical formulation as the brand-name product, but typically sold without the brand name and at a lower price. It is distinct from an independent generic, which is approved separately under its own abbreviated application by a different manufacturer.
How it affects what you pay
Authorized generics are generally priced below the brand-name product, similar to independent generics, though pricing can vary depending on market competition and timing. The FTC has studied authorized generics specifically because of their competitive dynamics: a brand-name manufacturer sometimes launches an authorized generic around the time independent generic competitors are expected to enter the market, which can affect pricing patterns during that transition period (FTC, Authorized Generics: An Interim Report). For consumers, the practical effect is usually similar to any other generic: a lower price than the brand-name product, though the exact savings depend on how many generic versions, authorized or independent, are competing at a given time.
Example
Consider a hypothetical brand-name drug nearing the end of its exclusivity period. The original manufacturer might begin selling an authorized generic version of that same drug, priced below the brand-name product, around the same time independent generic manufacturers enter the market. Over time, prices for that drug across all versions may continue to shift as more competitors enter. This is a general illustration, not a real drug or price.
How this differs from a regular generic
A regular, independent generic is approved through a separate abbreviated new drug application by a different manufacturer, which must demonstrate bioequivalence to the brand-name original. An authorized generic uses the brand company's own existing approval and is often literally made on the same production line as the brand-name product, just packaged and marketed differently. The FDA maintains a public list of currently marketed authorized generics, which can help you confirm whether a specific product falls into this category (FDA, List of Authorized Generic Drugs).
Checking your options
If you're deciding between a brand-name drug, an authorized generic, and an independent generic, ask your pharmacist which versions are currently available and how their prices compare. See our guide on what happened to $4 generic lists: low-cost generics today for related context on generic pricing trends. Compare prescription prices on BetterBuyRx to see current pricing across whichever versions are available for your medication.
Talking to your pharmacist
Because authorized generics, independent generics, and brand-name drugs can all be on the shelf for the same medication, search your medication on BetterBuyRx and ask your pharmacist directly which version you're being offered and why, especially if you notice a price change from a previous fill.
Frequently asked questions
Is an authorized generic the same medicine as the brand-name drug?
Yes, in composition. An authorized generic is literally the same drug as the brand-name version, made under the same approved application, but marketed and sold as a generic, typically at a lower price.
Why would a brand-name manufacturer sell an authorized generic?
It's often a business strategy used around the time independent generic competition is expected to enter the market, allowing the brand company to compete in the generic segment rather than losing that business entirely.
How do I know if a specific generic is an authorized generic?
The FDA maintains a public list of authorized generic drugs. Your pharmacist can also often tell you whether a specific product is marketed as an authorized generic.
Sources
Compare prices & find savings
This page is for cost and savings education only. It is not medical advice. Talk to your doctor or pharmacist about your specific medications and coverage. Prices vary by pharmacy, location, quantity, and eligibility.
Related terms & guides
- What Is a Generic Medication?
Generic medication definition: how the FDA defines generics, why they usually cost less than brand-name drugs, and how to check availability.
- What Is a Brand-Name Drug?
Brand-name drug definition: how it differs from a generic, why it usually costs more, and how patents affect availability of lower-cost versions.
- What Happened to $4 Generic Lists? Low-Cost Generics Today
The classic $4 generic drug list started in 2006. Here's what changed, which programs still exist, and how to find low-cost generics today.