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In some cases, the generics have to prove that they have the same effectiveness/bioavailabilty as the brand name. The brand names have been restricting the distribution of the drugs to prevent this from happening easily.

Because the red tape is fairly extreme. For proof, look at the prices a company like this will pay to "buy up" a generic drug. You'd think it wouldn't really be possible to sell rights to a generic drug for millions of dollars, but apparently you'd be wrong.

I guarantee there are manufacturers in the world who would be happy to have the business and could rapidly drive the price down to competitive generic levels again. But they are locked out by the bureaucracy.

You're right but regulatory approval is still difficult even for generics.

http://marginalrevolution.com/marginalrevolution/2015/09/gen...