Harvard University researchers have identified a new factor that is at least partially responsible for the increase in consumer spending for prescription drugs over the past 5 years: the upsurge in direct-to-consumer (DTC) advertising by pharmaceutical manufacturers since the FDA relaxed the rules for these ads in 1997.
In a study bankrolled by the Kaiser Family Foundation, the researchers concluded that 12% of the total growth in spending for prescription drugs can be attributed to spending on pharmaceutical advertising directed at consumers. The study also confirmed that DTC ads represent a surefire method for drug manufacturers to increase their sales volume. For every $1 spent by manufacturers to advertise prescription medicines to consumers, drug sales increased $4.20, the researchers found.
Significantly, however, the investigators further concluded that DTC ads also benefit the competitors of the manufacturers who pay for the ads. According to the study results, consumer advertising tends to boost demand for entire classes of drugs, such as antidepressants or heartburn medications, rather than just the specific brand being advertised.