Read this essay by acting FDA commissioner Stephen Ostroff on what the FDA is doing to get safe and effective generic drugs on the market promptly. The agency's efforts are important because the cost of generic drugs generally is far less than the cost of brand-name drugs. In particular, as Ostroff explains, the entry of a "first generic" in a market that has been monopolized by a brand-name drug has a substantial downward effect on prices. (Not only is the generic price far lower than the name-brand price, but the name-brand price tends to go down as well once the generic is marketed.)
The chart below describes savings from generic drugs and generic-drug market share from 1990 through 2013. (Congress enacted the Hatch-Waxman Act — the law that spurred market entry of generic drugs — in 1984.) Click on the chart to view a larger version.