The long deflation of generic prices

In January 2014, pharmacies paid an average of 17.7 cents for a 20 mg atorvastatin tablet, according to the federal government's National Average Drug Acquisition Cost survey¹. In October 2026 the monthly average was 2.8 cents. The cholesterol drug now costs pharmacies about one-sixth of what it did a dozen years ago.

That is the ordinary course for a generic. GxRadar tracked 43 widely used generics with NADAC prices in both January 2014 and October 2026, using monthly averages from CMS's NADAC files on data.medicaid.gov². Thirty-six cost pharmacies less at the end of the period than at the start. The median change was a 43 percent decline, and 17 of the 43 fell by half or more. These are nominal figures, before any adjustment for inflation, which would make the declines steeper. The GxRadar generic price index, built from the same 43 drugs, stood at 47.4 in October 2026 against a January 2014 base of 100.

Exceptions get the headlines, and they are real. But the long-run record, from both the NADAC survey and federal studies of Medicare and Medicaid data, shows a market in which competition pushes prices down and keeps them low, and where the rare spikes tend to follow a loss of competitors. All 47 drugs in GxRadar's series can be browsed on the prices page.

Most prescriptions, a small share of spending

Nothing shows how cheap generics have become more clearly than the gap between volume and dollars. In the generic industry trade association's 2026 savings report³, which covers 2025, generics accounted for 89 percent of prescriptions filled in the US (about 4 billion) but 11.6 percent of prescription drug spending (about $106 billion). Brand drugs filled the other 11 percent of prescriptions and took 88.4 percent of spending, roughly $804 billion.

Federal analysts reach similar conclusions on volume. A January 2025 brief⁴ from HHS's Office of the Assistant Secretary for Planning and Evaluation (ASPE) estimated that 91 percent of US prescriptions were filled with generics in 2022. Spending shares vary more from study to study because they depend on which price is counted: list price, invoice price, or price after rebates. A 2016 ASPE brief⁵, using a different data source and price definition, put generics at 88 percent of dispensed prescriptions and 28 percent of total drug spending. Every measure points the same way.

The record, tablet by tablet

Since late 2013, the NADAC survey has tracked what retail pharmacies pay for drugs, and it is one of the few long public price series for individual generics. GxRadar's explainer on what NADAC measures covers its scope and limits.

Values are GxRadar's monthly medians of the weekly CMS NADAC per-tablet rates for each January, from the files CMS posts through Medicaid.gov¹. They are national averages of pharmacy invoice costs and are not retail prices; how NADAC is calculated explains the survey method.

Atorvastatin kept falling for years after its generic launch. Drugs that were already cheap a decade ago, like lisinopril and metformin, had little room left to fall and have moved sideways at one to two cents a tablet. Levothyroxine went the other way first, rising between 2014 and 2018 before a steep decline.

At the far ends of GxRadar's 43-drug comparison, doxycycline hyclate 100 mg capsules fell 97 percent, from $3.35 to under 11 cents, though the series opened at its own high point, about $3.36 in November 2013. Sildenafil 20 mg fell 92 percent. Seven drugs cost more in October 2026 than in January 2014, and the largest increase was furosemide 40 mg, which went from about one cent to about three cents a tablet, a 180 percent rise in a price that remains small in absolute terms.

Competition does most of the work

Behind the decline is the number of manufacturers selling a given product. FDA economists measured this in a December 2019 analysis⁶ of generic prices relative to the brand price before generic entry. On manufacturer prices, one generic maker was associated with a reduction of 39 percent, four makers with 79 percent, and six or more with more than 95 percent. GxRadar's article on why generic prices fall as competitors enter walks through the full table.

ASPE's study of Medicare data from 2007 to 2022⁴ found the same relationship. In markets with 10 or more competitors, generic prices were 70 percent to 80 percent below the pre-entry brand price three years after the first generic launched.

Size matters too. The same ASPE study found that about 60 percent of the drugs it examined (265 of 446) were in small markets with fewer than 5,000 monthly users. Those small markets averaged about three manufacturers per drug, compared with close to 10 in large markets. Fewer competitors means less downward pressure, which helps explain why some low-volume generics never get as cheap as the blockbusters.

The spikes inside the decline

Averages hide episodes where individual generics jumped sharply in price. In an August 2016 report on Medicare Part D⁷, the Government Accountability Office found that generic prices fell 59 percent overall from early 2010 to mid-2015. Yet more than 300 of 1,441 established generics had at least one price increase of 100 percent or more, and most of those increases did not reverse. GxRadar's article on the generic price spikes of 2013 to 2015 covers that report in detail.

ASPE's 2016 brief⁵ on the same period described a similar split. About two-thirds of generic products appeared to see price declines in 2014, while a small number saw extreme increases. Its most dramatic example was tetracycline, whose acquisition cost rose about 17,700 percent, though it made up only 0.001 percent of Medicaid prescription spending. GAO reported⁷ that manufacturers pointed to competition as the main driver of generic prices, with fewer competitors tending to push prices up.

The pattern persists in list price data. ASPE's analysis of list price changes⁸ from January 2022 to January 2023 found that among products whose prices rose, multi-source drugs (a group that includes generics) had a higher average percentage increase, 26.0 percent, than single-source drugs at 7.4 percent. In dollar terms the multi-source increases were small, averaging $69 against $958 for single-source products, because the starting prices were so low.

What a price floor does to supply

When a tablet costs a pharmacy two cents, the price has little room left to fall, and the margin for making it is thin. If low margins lead manufacturers to leave a market, the competition effect runs in reverse, and the companies GAO interviewed⁷ said prices tend to rise as suppliers drop away. That cycle connects generic pricing to supply reliability, the subject of GxRadar's pieces on why drug shortages happen and sterile injectable shortages.

A pharmacy's cost is also a separate number from the price at the counter, which is shaped by pharmacy costs and insurance contracts and does not always track the falling cost of the drug itself. GxRadar's piece on why the same generic costs different amounts covers that gap.

CMS publishes a new NADAC file every week on data.medicaid.gov². Atorvastatin's October 2026 average, 2.8 cents, sat a fraction of a cent above the low point of GxRadar's series, 2.76 cents in September 2026.