This study in PLoS Medicine reports that, based on estimates from publicly available data, drug manufacturers probably spend more money on advertising than they do for research and development.
In the words of the study: "From this new estimate, it appears that pharmaceutical companies spend almost twice as much on promotion as they do on R&D. These numbers clearly show how promotion predominates over R&D in the pharmaceutical industry, contrary to the industry’s claim. While the amount spent on promotion is not in itself a confirmation of Kefauver’s depiction of the pharmaceutical industry, it confirms the public image of a marketing-driven industry and provides an important argument to petition in favor of transforming the workings of the industry in the direction of more research and less promotion."
This study makes it clear that it is using estimates to reach its conclusions. The manufacturers don’t report this data, so the authors had to take the limited available information and do what they could. Obviously, they could be wrong.
So, why bring this to your attention? We all remember a time when hospital ads did not appear on every seventh billboard and drug companies were absent from the print media and television. The substance of ads from hospitals can be used in malpractice cases against those hospitals. So to the drug company ads – and they can also be used to attack the outdated learned intermediary doctrine. Finally, as the health and drug industries continue their assault the civil justice system on the grounds that financial responsibility is affecting their ability to offer new services and products, it is fair to demand answers to the questions of how they spend their money. Is the public really being served by drug ads?
Now, before I get attacked for being a socialist, let me add that I don’t care how much money the drug companies spend on ads. That is between them and their shareholders, and so long as the ads are not unfair or misleading and otherwise comply with the regulations, I don’t care whether they advertise or not. What I do care about it the effort by the industry to say that they can’t afford to develop drugs because of product liability suits at the same time they appear to be spending billions of dollars to sell drugs – when they secured more than adequate profits for decades before they started advertising. If the drug companies want special protection from lawsuits, then they should be required to disclose what they spend to sell drugs and how they spend it. That way, legislatures can make a choice about whether it is in the public interest to grant legal protections to the drug industry and preserve its choice to spend its money on Madison Avenue rather than in a laboratory in New Jersey.
Once again, the DC Medical Malpractice Law Blog informed me of the existence of this article.