Drug Ads Ineffective For Boosting Sales, Could Cost Taxpayers: UBC-Harvard Study

Main Category: Pharma Industry / Biotech Industry
Also Included In: Medicare / Medicaid / SCHIP
Article Date: 25 Nov 2009 - 0:00 PST

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US Taxpayers may be on the hook for the high cost of drug advertising that does little to boost sales, according to a new study led by a University of British Columbia health policy researcher.

The study, published in the Archives of Internal Medicine, examined the US sales patterns of clopidogrel, a top-selling drug also known by the trade name Plavix used to prevent blood clots after heart attack or stroke. The drug was selected to study the impact of advertising on sales because it was sold for more than three years before the launch of its first direct-to-consumer advertising (DTCA) campaign in 2001.

"While clopidogrel use has been increasing for some time, we found advertising it to consumers didn't make use rise any faster," says Asst. Prof. Michael Law of the UBC Centre for Health Services and Policy Research, who conducted the study with colleagues from Harvard Medical School, the University of Alberta and Kaiser Permanente while he was a post-doctoral fellow at Harvard.

The researchers found a significant jump in the drug's price that coincided with the launch of its DTCA campaign. This higher price added US $207 million to the pharmacy bill for Medicaid, a publicly funded health program in the US for individuals and families with low incomes.

"Pharmaceutical companies need to recuperate the costs of the advertising through either increased sales or higher prices," says Law. "The timing of this price increase raises important questions about whether it was related to the US $350 million spent advertising clopidogrel through 2005."

"The key issue is whether advertising to consumers, which has risen 330 per cent in the last 10 years in the US, contributes to the significant cost increases in publicly funded health insurance programs such as Medicaid," says Stephen Soumerai, co-author of the study and professor of Population Medicine at Harvard Medical School and the Harvard Pilgrim Health Care Institute.

The authors have previously studied the effectiveness of DTCA of other popular drugs and found little or no impact.

Source: Brian Lin
University of British Columbia