The stakes are enormous. In 1996, the pharmaceutical industry spent $11.4 billion on the promotion of their products. By 2005, that number had increased to $29.9 billion. Less than 10% of those funds are spent in advertising, but over that period of time, the proportion of funds spent on DTC advertising has steadily increased, while the proportion of funds spent on professional promotion (like the ads that appear in this magazine) has steadily declined.3
Congress has begun to take notice. DTC advertising generally starts one year after a drug receives approval from the FDA. The Responsibility in Drug Advertising Act (H.R. 4565) seeks to amend the Federal Food, Drug and Cosmetic Act to prevent DTC advertising for the first three years a drug is on the market.4 Although this act would have a miniscule impact on the industry, it does highlight the existence of some level of discomfort in allowing advertisements that might encourage patients to abandon older (and cheaper) therapies for something shiny and new.
Interestingly, this is almost a uniquely American issue. The U.S. and New Zealand (a country with the same total population as the city of Los Angeles) are alone in allowing DTC advertising. No other nations allow this particular oddity to exist.5
The Commonwealth of Virginia saw medicine as a public trust & believed that allowing pharmacies to lure customers with something as base as cost cutting was unseemly.
How We Got Here
How is this still a thing? As you may have guessed, it is the direct descendant of the Law of Unintended Consequences. You may not have suspected, however, that it is also the stepchild of Ralph Nader, the consumer advocate. Up through the 1960s, labeling requirements pertained almost entirely to over-the-counter medications. For prescription drugs, the patient was entirely reliant on the physician to explain the risks and the benefits.
This started to change in the 1970s, in large part due to Ralph Nader’s Public Citizen consumer rights group, which pushed for more information to be made directly available to the patient. These efforts, in part, led to the large (and largely unread) package inserts that now accompany every prescription you might pick up from your local pharmacy.6
Ralph Nader also fought for the right of the patient to know how much a drug might cost. In the 1970s, Public Citizen challenged a Virginia law that prevented advertising the price of drugs being sold. The law was well intended: The Commonwealth of Virginia saw medicine as a public trust and believed that allowing pharmacies to lure customers with something as base as cost cutting was unseemly. The practical consequence of the law, however, was that in Virginia, the cost of drugs varied dramatically in price, and the patient had no easy way of figuring out if he was getting a bargain or if he was being had.
