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Eye on the US: The Congressional Budget Office has reported on the potential effects of a two-year moratorium on direct-to-consumer advertising of new drugs

USAThe potential benefits and drawbacks of direct-to-consumer (DTC) advertising for prescription drugs have long been a subject of debate in the US, particularly since the late 1990s, when new guidelines from the US Food and Drug Administration (FDA) clarified the agency's position on broadcast ads for pharmaceuticals and led to a spike in radio and television commercials for medications. Prescription drug ads are a near-ubiquitous fact of life in the US these days; it is almost impossible to open a popular magazine or watch the evening news without encountering some.

Supporters of DTC advertising argue that communicating directly to consumers is protected by the pharmaceutical industry's Constitutional rights concerning commercial speech under the First Amendment.

They also believe it is a public good that allows the industry to use its considerable resources to educate consumers about diseases and to disseminate important information about the risks and benefits of their medicines. In particular, the ads can have a positive effect on outcomes for diseases that often go under-diagnosed and undertreated, by encouraging consumers to visit their doctors and discuss the signs and symptoms they may be experiencing, proponents say.

Even the FDA and the Federal Trade Commission (FTC), both of which have jurisdiction over preventing violations in drug advertising, have acknowledged that truthful, balanced DTC advertising appears to have public health benefits in that it keeps consumers informed and encourages discussion with their doctors.

However, opponents of DTC advertising, including some influential lawmakers, maintain that it drives up the nation's health costs by encouraging consumers to demand prescriptions for drugs they do not really need. There are also public health concerns, including the possibility that consumers will end up taking drugs with risks that outweigh their benefits in the patient's particular situation, they say.

A potential ban
Congress has not yet taken any action to ban DTC advertising for prescription drugs, but it has seriously considered several proposals to do so in recent years. One of the proposals with the most momentum has been a plan to prohibit DTC ads for drugs during new products' first two years on the market, the idea being that the moratorium would allow time for doctors to become fully educated about, and experienced with, the medicines before their patients began to demand them. The delay would also allow some time for potential adverse effects to surface in a real-world setting before the drug is widely promoted.

A two-year ban would be in line with a recommendation from the Institute of Medicine (IOM), a highly respected not-for-profit, non-governmental agency that is part of the US National Academies and is charged with providing independent guidance on health-related issues to lawmakers and other stakeholders. In a 2007 report, the IOM advised that the FDA requires pharmaceutical manufacturers to refrain from advertising drugs to consumers during the first two years following a drug's approval. The IOM said that industry self-regulation was not enough to keep DTC advertising under control, in spite of the fact that Pharmaceutical Research and Manufacturers of America, the industry's main trade group, had at the time just significantly strengthened its DTC guidelines for member companies.

The CBO's perspective
Now, the Congressional Budget Office (CBO), the federal agency responsible for providing Congress with economic data to help inform lawmakers' decision-making, has issued a report looking at the potential effects of a two-year moratorium on DTC advertising for new drugs and drawing conclusions that appear to be mostly in the pharmaceutical industry's favour.

Based on a review of the existing data and academic analyses on DTC marketing, the CBO outlined three likely outcomes of a two-year moratorium on consumer marketing for new drugs: first, drug companies would probably increase their marketing to doctors in order to compensate for the loss of consumer advertising; second, some new drugs would see fewer prescriptions written, though others may be largely unaffected and, third, drug prices would probably be largely unaffected, as they are tied to demand, which would be unlikely to be significantly changed by a ban on consumer ads.

The CBO's conclusions run contrary to the rhetoric that has fuelled some calls for the marketing ban, including the claim that DTC ads increase demand for drugs drastically and, therefore, increase drug prices.

Unintended negative consequences
In addition, the CBO pointed out that a ban on DTC marketing could have unintended negative consequences for public health.

'Although it would allow more time for possible safety problems with some drugs to be uncovered and to become widely known, some individuals who would benefit from a new drug might be unaware of its availability and not seek treatment in the absence of consumer advertising,' the CBO said. 'Thus, the health effects of a moratorium would depend on whether the benefits of fewer unexpected adverse events were larger than the health costs of possibly reduced use of new and effective drugs.'

A moratorium on DTC ads for the first two years could also mean that it would take longer for information about a drug's risks to reach the public, as risk information was a required part of all DTC communications, the CBO pointed out. In addition, slowing the adoption of new drugs by preventing DTC ads would slow the accumulation of real-world data. 'Indeed, researchers have found a link between the promotional activities that pharmaceutical manufacturers use to expand the market for their drugs and increased reporting to the FDA of adverse events from a greater number of people taking those drugs,' the CBO said.

Echoing an argument frequently made by the drug industry, the CBO also voiced concern that the ban could dampen innovation by research-based pharmaceutical companies. Faced with a DTC marketing ban, drug companies 'may see their opportunity to create a market for a first-in-class drug and to benefit from its monopoly status delayed or diminished. That outcome could, in turn, reduce their incentive to research and develop new breakthrough therapies,' the CBO argued.

'The newest drugs on the market tend to be among the most heavily promoted, raising the risk that more people will be adversely affected before steps can be taken to identify and address such potential safety problems,' the CBO acknowledged. However, it also pointed out that the potential risks associated with DTC advertising were mitigated by the fact that consumers could not, of course, begin taking a drug in response to an advertising campaign without a doctor's approval.

'Prescription drug advertising cannot prompt consumers to take such independent action because they must receive a prescription before obtaining a drug; however, that advertising can lead them to consult a doctor about their condition and to ask about the advertised medication as a treatment option,' the report pointed out. 'Only physicians and other healthcare professionals can write prescriptions, which explains why drug manufacturers target them with most of their promotional spending.'

The report was issued by the CBO's Microeconomic Studies Division and was based on data on promotional activities from 1999 to 2008 and on prescription sales from 2004 to 2008. The data included 366 brand-name drugs that were marketed to physicians, 73 of which were also advertised directly to consumers.

The CBO's data review found that US pharmaceutical manufacturers spent $20.5bn on promotional activities in 2008, $4.7bn of which was paid out for DTC advertising. The rest was spent on marketing to physicians and other healthcare professionals.

The next frontier
As the debate surrounding DTC advertising continues, the rise of social media is opening up a number of new questions. The FDA announced this year that it plans to conduct a trio of experimental studies in an attempt to determine how to ensure 'fair balance' in the information presented in online DTC promotions.

The three studies, which will run concurrently, will use a mock DTC website to test viewers' responses to the information presented.

The first study will enrol 4,000 consumers to test the efficacy of various formats, such as paragraphs vs bullet lists, for presenting information online. The second will enrol 2,000 consumers to test how features like personal testimonial videos and interactive mechanism-of-action graphics affect consumers' understanding of the information presented in DTC advertising.

The third will recruit 3,600 participants to test the effect of links to, and information from, external organisations and advisory groups on consumers' understanding of the information being presented.

In the meantime, the pharmaceutical industry is still awaiting guidelines from the FDA making clear the agency's stance on various aspects of using social media to reach consumers. The agency has twice delayed releasing the guidelines, which were originally expected in December 2010. In announcing the latest delay at the end of March, the FDA said that the guidelines continue to be among its 'highest priorities' but did not provide a target date for when they can now be expected.

The agency said that the guidelines being prepared will consist of 'multiple draft guidances' addressing issues such as 'responding to unsolicited requests; fulfilling regulatory requirements when using tools associated with space limitations; fulfilling post-marketing submission requirements; online communications for which manufacturers, packers, or distributors are accountable; use of links on the Internet and correcting misinformation.'

Kate Fodor

The Author
Contact Kate Fodor at

12th July 2011


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