Does it seem like you’re seeing more ads for prescription medications and medical services? You’re not imagining it. In 2016, the last year for which data were available, pharmaceutical companies alone bought 4.6 million direct-to-consumer ads, up from 79,000 ads in 1997. Spending increased nearly six-fold, from $1.3 billion to $6.0 billion during this time period. Total medical services advertising expenditures grew at a similar rate, led by cancer centers, mental health and addiction services, and cosmetic surgery services.
According to PhRMA, the largest pharmaceutical trade group in the U.S., direct-to-consumer advertising provides “scientifically accurate information to patients so that they are better informed about their health care and treatment options.”1 Around half of the consumers in a 2015 analysis by the U.S. Food and Drug Administration believed these ads did not contain enough information about the medications’ risks and benefits to be of use. That year, the American Medical Association (AMA) called for a ban on pharmaceutical and medical device advertising, saying that ads such as these encourage consumers to seek out more expensive treatments when less expensive, more appropriate, effective alternatives may be available. In addition, the AMA was concerned that increased spending on advertising led to higher prescription drug prices. Banning such advertising would not be easy, even if Federal lawmakers agreed that such a ban should take place. Several court cases throughout the years determined that this type of advertising is protected by the United States Constitution.
Today’s market sizes show total medical marketing spending and spending on a subset of that, direct-to-consumer advertising, in 1997 and 2016. Medical marketing includes advertising of prescription drugs, health services, and laboratory testing. It also includes disease awareness campaigns. Marketing to health care professionals by pharmaceutical companies accounted for most of the spending during this time period. However, as a percentage of total spending, this has been dropping. In 1997, 88.1% of medical marketing dollars were spent on free samples, direct physician payments for such things as speaking engagements and meals, and prescriber detailing, in which pharmaceutical sales representatives educate physicians about their products. In 2016, 67.9% of marketing dollars were spent this way. Direct-to-consumer marketing comprised the balance.1 PhRMA spokesperson Tina Stow. Source: Susan Kelly, “U.S. Doctor Group Calls for Ban on Drug Advertising to Consumers,” Reuters, November 17, 2015, available online here
Geographic reference: United States
Year: 1997 and 2016
Market size: (Total) $17.7 billion and $29.9 billion, respectively
Market size: (Direct-to-consumer advertising) $2.1 billion and $9.6 billion, respectively
Sources: Lisa M. Schwartz, MD, MS and Steven Woloshin, MD, MS, “Medical Marketing in the United States, 1997-2016,” JAMA, Special Communication, January 1-8, 2019 available online here; Susan Kelly, “U.S. Doctor Group Calls for Ban on Drug Advertising to Consumers,” Reuters, November 17, 2015, available online here; Alison Kanski, “7 Things to Know from Dartmouth’s Medical Marketing Study,” MM&M, January 14, 2019 available online here; Margaret Rouse, “Pharmaceutical Detailing,” TechTarget, February 2011 available online here.
Image source: Martin Brosy, “Doctor with a Stethoscope,” Unsplash, July 30, 2018 available online here.