Pros and Cons of Direct-to-Consumer Advertising in the Pharma Industry
the pros and cons of Direct-to-Consumer Advertising in the Pharma industry, from marketing to ethics to public health.
Pharmaceutical marketing has taken many forms over the years. There is likely no better example of this than Direct-to-Consumer advertising (DTCA), which still faces multiple legal and ethical challenges. In fact, as of writing this article, DTCA is only legal in two developed countries; the US and New Zealand. But even where it is legal, there are many questions for the aspiring pharmaceutical marketer.
From marketing efficiency and return on investment (ROI) to broader effects and challenges, it is far from a simple endeavor. Let us thus explore the pros and cons of Direct-to-Consumer advertising in the Pharma industry, as well as its foundations.
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A history of direct-to-consumer advertising in the pharma industry
DTCA, the Pharma industry aside, is nothing new as a marketing concept. It hinges on advertising products directly to consumers, much like Business-to-Consumer (B2C) businesses do, bypassing third parties. However, the term typically refers to advertising pharmaceuticals specifically, where the concept takes a more controversial form. DTCA for pharmaceuticals entails bypassing, or not explicitly targeting, medical professionals and addressing the consumer themselves. It is this circumvention that gives rise to much debate to this day.
As highlighted above, DTCA is only fully legal in the US and New Zealand, as it has been for roughly four decades. The New Zealand Medical Journal (NZMJ) traces its origins in these two countries back to the 1980s. It holds that DCTA developed in New Zealand because "the Medicines Act 1981 did not specifically prohibit the practice".
In contrast, it continues that DCTA was explicitly enabled in the US by "a 1982 ruling by the Food and Drug Administration (FDA) that DTCA did not inherently violate FDA administrative law and regulations". Since then, both countries' governments reviewed DTCA multiple times, stressing the need for regulation to protect public health.
Direct-to-consumer advertising in the pharma industry today
Despite regulations and challenges, DCTA has thrived – as DCTA marketing budgets show. In 2019, Forbes reported on findings of the Journal of the American Medical Association (JAMA) that highlight this trend. Most notably, it reported a 361% increase in DCTA budgets from 1997 to 2016, from $1.3 billion to over $6 billion.
While one may identify many reasons for this trend, a key factor is likely simple; it works. Forbes continues, citing a House Commerce Committee's findings that "for every $1,000 spent on prescription drug ads, 24 new patients were added for the pharma industry". It then concludes by highlighting a highly critical report that found that "rates for prescription drugs with ads were almost seven times greater than for those without ads".
Finally, similar findings and reports confirm the efficiency of DCTA. However, some reports like those mentioned above remain vocally opposed to it, despite its marketing merits. It's this controversy that exploring the pros and cons of Direct-to-Consumer advertising in the Pharma industry can illuminate.
Pros of direct-to-consumer advertising in the pharma industry
Advocates of DCTA approach the subject in two distinct ways. For one, they hold that it benefits patients by increasing awareness, removing the stigma of certain diseases, and other factors. Secondly, they suggest that it follows the digitization of information, permitting patients to take control of their health.
1. Benefits to the patient
Proponents suggest that DCTA promotes virtual access to healthcare. They hold that it has multiple benefits for patients, including the following.
It empowers patients. Some, like Amanda L. Connors, hold that it informs and educates patients. They say that, with proper regulation, DTCA only adds to available information for patients to act on.
It encourages patients to contact health professionals and addresses under-diagnosis. Others add that DTCA encourages patients to seek medical advice. Reports find that many US patients are indeed more likely to discuss conditions they hadn’t previously disclosed. Similarly, other studies add to the conclusion that DTCA assists patients by encouraging seeking medical advice. In doing so, it helps address under-diagnosis and undertreatment.
2. An efficient product of digitization
Similarly, proponents suggest that it’s an effective product of digitization, complementing marketing to healthcare professionals (HCPS).
It is safe due to the digital market. Given all the regulations that DTCA has seen, many argue it’s a safe means of advertising. Risk management frequently stresses disclaimers and side-effects, which some find have even made pharma ads “formulaic [and] boring”.
It is facilitated by social media advertising. Finally, marketers argue that social media marketing, which continues to boom, facilitates all of DTCA’s benefits. Social interactions accelerate positive change, and the amount of money earned from such advertising benefits the market.
Cons of Direct-to-Consumer advertising in the pharma industry
Still, it is not a subject without detractors. Critics see more harm than benefit in the pros and cons of Direct-to-Consumer advertising in the pharma industry. They typically focus on two fronts; disinformation and drug over-utilization, and increased costs to patients.
1. Disinformation and drug over-utilization
Critics frequently cite the potential for misinformation as grounds for more regulations or other actions.
DTCA may omit crucial information. Studies find that such ads may omit risk factors, prevalence, and other critical information. Coupled with language and messaging clarity, they argue that patients may be insufficiently informed on relevant pharmaceuticals.
It may promote drug over-utilization. Other studies stress that DTCA adds to the “medicalization” of trivial conditions and ailments. Combined with arguably over-trusting audiences, they argue that it promotes overmedication.
2. Increased cost to patients
Finally, critics claim that DTCA results in increased medical costs for patients.
It may increase the cost of pharmaceuticals of equal effectiveness. As DTCA constitutes marketing, critics hold that branding and presentation may lead to misinformed decisions. They argue that patients may be wrongly convinced that more expensive pharmaceuticals may offer more benefits than cheaper alternatives. The study by Amanda L. Connors cited above offers such examples.
It strains relationships with healthcare professionals. Finally, critics note that DTCA may diminish patients’ trust in their healthcare providers. In combination, some physicians argue that having to convince patients of a drug’s inappropriateness wastes appointment time. These factors, some claim, increase the overall cost of health services by reducing the quality of health-related appointments.
For more on digital advertising in the pharmaceutical sectors, and how we can help, see our section on media planning and buying.
Guest contributor: Lisa Roberts.
