Direct-to-consumer advertising accounted for 12% of prescription drug growth in 2000, or about $2.6 billion, according to a new study released today by the Kaiser Family Foundation.
The study estimates that in 2000 12% of drug spending growth was related to increased spending on DTC advertising, with each additional dollar in DTC advertising yielding an additional $4.20 in drug sales in that year.
Researchers at the Harvard School of Public Health, Massachusetts Institute of Technology, and Harvard Medical School analyzed the impact of DTC advertising through magazines, newspapers, television, radio and outdoor advertising on pharmaceutical spending and prescribing in five therapeutic drug classes.
They also found that DTC advertising of one drug seems to work by increasing sales for the advertised drug and for its competitors alike.
"Our results indicate that the principal effect of DTC advertising is to expand the use of all brands in a therapeutic class rather than to switch existing patients from one brand to a competitor," says co-author Meredith Rosenthal of the Harvard School of Public Health, in a release.
While DTC advertising accounted for only 14% of promotional activities by pharmaceutical companies for prescription drugs in 2001, spending for it has increased at an average annual rate of 28% since 1996, the Kaiser Foundation reports.
By comparison, Kaiser says promotion directed at physicians accounted for 86% of overall promotional spending, with 55% of that for free drug samples, 29% for drug reps' activities and 2% for medical journal advertising.