Should prescription drugs be advertised?
By Dr. Harold A. Black
blackh@knoxfocus.com
haroldblackphd.com
For the longest I wondered why prescription drugs are advertised on TV. The ads target the public and not doctors. You cannot walk into a pharmacy and get Lyrica, Eliquis, Humira, Latuda, Xeljanz, Celebrex or Chantix without a prescription. Yet the pharmaceutical industry spends $3.5 billion a year advertising prescription drugs. It must be effective or else they would not spend all that money. I guess they figure that a person who has a certain condition will see an ad for a particular drug and then go ask their doctor for it, assuming that the doctor would not prescribe it otherwise. For me, the disclaimers are reason enough not to try the drugs, but I must be in the minority (no pun intended).
The United States and New Zealand are the only countries that allow this type of advertising. None of this was legal until 1997 when the FDA authorized it. Perhaps it is not surprising that the FDA head who approved the ads went to work for a pharmaceutical company when he left the government.
Robert F. Kennedy Jr. wants to ban this advertising. He claims that the advertising leads to higher healthcare costs and over prescription of medications. Kennedy says, “The constant barrage of drug commercials is not only annoying but also detrimental to public health. It’s time we put an end to this practice and prioritize patient well-being over corporate profits.” Sounds like Bernie Sanders. You can bet that the pharmaceuticals will fight this tooth and nail.
That seems like an empirical question. So is it true? Is drug advertising detrimental to public health? Research has shown that drug utilization is highly responsive to advertising exposure. Increased advertising also leads to more doctor visits per year. There is a positive association between exposure to drug advertising and intention to switch medications or engage in behavior to find out more about the medication. One study finds that “advertising benefits both consumers and companies advertising the products. Consumers benefit through increased adherence to medications, greater engagement with the healthcare system and use of generic medications. Companies benefit from greater sales of their products and more favorable consumer opinions of the industry.”
A study on antidepressants found that the medications were prescribed far more often when the patients requested them and showed that advertising may have competing effects on quality, potentially averting underuse while also promoting overuse. In general, research shows that advertising is effective in that more advertising leads to more requests for the advertised medication, which leads to more prescriptions. Research has also shown that generics are not adversely affected by advertising.
It is well documented that the price of advertised prescription drugs in the United States is over three times that on average for developed countries, but generic drugs are generally cheaper in the U.S. and ninety percent of all prescribed drugs are generic. I wanted to compare the U.S. with New Zealand or New Zealand with other countries, but could not find any data. However, I am not certain that I would have learned anything because I am not versed in the nuances of drug pricing. The final cost direct to the consumer is rarely the list price of the drug. What is the difference between the actual price paid by consumers in the U.S. versus the rest of the world? Many countries have price controls on drugs, but that results in fewer drugs being available to the public. In the U.K., their national health service will not pay for any therapies whose costs exceed $50,000 per year. Do we want that? Only 1 out of every 12.5 potential drugs ever reaches patients; the average drug takes 11-14 years to develop, and the costs of bringing a drug to market are $1 billion-$2.5 billion. The drug companies say that price controls would inhibit research on new drugs.
In economics, we study trade-offs. With drugs, we are looking at the trade-off between today’s prices, profitability and citizens’ health in the longer run. Here, the question is whether the lowering of drug company profits and drug prices today reduces the likelihood that more specialized medications for rare medical conditions will be developed in the future. Are we willing to make that trade-off?
