News at NCH
"Pharmaceutical Marketing" by Allen Weiss, MD, MBA, President & CEO


Pharmaceutical Marketing


December 15, 2011 - Many prescription drug ads and commercials directed to consumers can be confusing and scary. But they are effective! This was the finding of a New England Journal of Medicine article written in 2007, the tenth anniversary of the Food and Drug Administration (FDA) policy change allowing TV advertising.

The primary mission of a pharmaceutical firm is to generate profits and increase shareholder value. Effective marketing helps companies achieve their mission; there is ample evidence that direct-to- consumer advertising increases pharmaceutical sales and leads to increased consumption of medications.

This is not necessarily a bad thing, since many patients underutilize appropriately prescribed drugs. The pharmaceutical industry must believe their direct-to-consumer advertising dollars are being well spent, with this expenditure increasing from $11.4 billion in 1996 to $29.9 billion in 2005—an average annual rate of 10.6%. Direct-to-consumer campaigns generally begin within a year of approval for use by the FDA as this agency is required to review the marketing plan. The only other country which allows direct-to-consumer advertising is New Zealand.

Interestingly, direct advertising makes up only 12.5% of the pharmaceutical industry’s total promotional expenditures. When this spending was broken down, the results indicated that 56% was for free samples, 25% to influence physicians, 12.5% direct to consumer advertising, 4% on hospital marketing, and 2% on medical journal ads.

Physician marketing is typically performed by pharmaceutical representatives, with the current ratio being one representative to every six physicians. One estimate is that the pharmaceutical industry, on average, spends over $12,000 per year on each practicing physician in the country!

Living in an age of transparency, and aided by internet technology gives the consumer real advantages. But there are also some disadvantages. We can learn almost too much about rare side effects which often are not clinically relevant and can increase the consumer’s anxiety about a particular drug. The FDA requires pharmaceutical companies to share side effects, which are usually listed in small print or stated so quickly in a TV ad as to be glossed over by a potential patient. The FDA does not require that all possible side effects be mentioned in a TV or radio commercial.

Direct-to-consumer marketing can be in print, TV, radio or more frequently these days, on the internet. The amount of money spent by the pharmaceutical industry is impressive. For example, $224 million was spent in 2004 on the heartburn relief drug Nexium, whereas Coca Cola Classic spent only $146 million in 2003. “Big Pharma”—as the industry is known—believes their marketing encourages patients to seek appropriate care, have a better interaction with their caregivers, and improve compliance while keeping the physicians in control.

But promotion is not education. Ads and commercials promote the use of newer more expensive medications, thus leading to higher costs. Physicians can be influenced in two ways—one by patients who are swayed by direct consumer ads, and the other by the ubiquitous pharmaceutical representatives who generally believe they are sales folks with a small but influential audience—physicians. The likelihood of inappropriate use of medication increases as we are bombarded with infomercials.

Patients who request a drug are sixteen times more likely to get it. Over diagnosing and over treating are real problems in America today as we spend twice as much per person per year on healthcare compared to the next most expensive country.

More is not necessarily better. Understanding your illness and its treatment is probably the best thing you can do to prevent further illness, maintain your current condition, and restore yourself to good health. Marketing works so let’s use it to better understand how to care for ourselves and not to increase the use of unnecessary and potentially harmful medications. Having a long term, mutually trustworthy, stable relationship with a primary care physician is so important in determining if the benefits of any drug will outweigh possible harmful side effects.

 

 
Past Health Advice Articles

Dr. Allen Weiss is CEO & President of the NCH Healthcare System. He is board certified in Internal Medicine, Rheumatology and Geriatrics, and was in private practice in Naples, Florida from 1977 - 2000. Dr. Weiss is active in a variety of professional organizations and boards, and has been published in numerous medical journals, including the American Journal of Medicine and the Journal of Clinical Investigation.