This story is adapted from an article written by Professor Anthony Cox, PhD for the Indianapolis Business Journal.
The American Medical Association (AMA) recently called for a total ban on direct-to-consumer (DTC) pharmaceutical advertising, saying the industry’s well-funded campaigns sway patients towards newer and more expensive drugs and away from older but affordable and effective treatments like generics.
The AMA argues that a barrage of commercials leads consumers to demand the latest drugs, straining doctor-patient relationships and fueling rising healthcare costs. Reports from the organization’s meeting in Atlanta (where the new policy was approved) highlighted comments by some physicians that advertising “interfered” with their ability to offer advice to patients fixated on brand names and lofty promises.
Anecdotes can be persuasive, but our research leads us to a qualified defense of DTC pharmaceutical advertising. While DTC ads can be annoying, we find that pharma ads are actually among the most honest forms of consumer advertising, that they can promote a more informed and open discussion between doctors and patients, and that they aren’t a major driver of higher prices.
Drug advertising is the most-regulated form of consumer advertising, governed by strict guidelines and oversight from the FDA. Anyone who has seen one of these ads recently – and who hasn’t? – knows that the various disclosures and disclaimers often take up most of the time allotted and can include graphic descriptions of potential side effects.
Because the FDA also regulates the approval of all new drugs, pharma companies have a strong incentive to live within the guidelines and maintain good relations with the agency – a motivation that other consumer advertisers lack with the Federal Trade Commission.
Since these ads are clearly identified as promotional messages, they also warn consumers to be skeptical of their claims. Today, we have more ways to avoid ads altogether or aggressively investigate the pros and cons through online access to a vast library of medical resources, expert opinion and real patient stories.
So while DTC advertising may make a certain drug top-of-mind, it also leads wary consumers to come to their physicians armed with research, follow-up questions and concerns. Our natural instinct to think critically about advertising may lead to a more thorough conversation –a dialogue that doctors should welcome.
Even the brand awareness impact may be overstated: A recent survey of physicians (Parnes et al) finds that patients mention specific drug names in less than 5% of doctor visits – hardly a testament to the efficiency of paid advertising.
It’s also important to note that over 80% of pharma marketing budgets are still focused on promotions to physicians themselves, including advertising in medical journals, visits from sales reps, distributing samples of new drugs, even payments to physicians. All of these activities influence physicians to prescribe newer, more expensive drugs; most important, they are largely hidden from patients. In contrast, direct-to-consumer advertising is the much more transparent form of persuasion.
Just as DTC advertising is one element of a broader communications effort, it represents just a tiny sliver of overall prescription drug costs. Rising drug prices are a very real concern, but advertising expenses are far too small compared to total spending to be singled out as a major culprit.
The AMA may be well-meaning in its call for an advertising ban, but we’d encourage them to apply the same level of outrage to the meals, junkets and free samples showered on doctors by drugmakers.
If the AMA truly wants to reduce the undue influence of pharmaceutical marketing, perhaps the first prescription should be “physician, heal thyself.”
Tony Cox is a Professor of Marketing at the IU Kelley School of Business in Indianapolis; he focuses on healthcare consumer decisions and chairs Kelley’s Business of Medicine Physician MBA program.