Have I suddenly become more popular or have the drug companies just increased their budgets for "informational campaigns"?
 Volume XI, Issue 9
Harold J. DeMonaco, M.S., Director of Drug Therapy Management

 

The former may be true, but the latter certainly is. According to a recent study conducted by Scott-Levin, a pharmaceutical company consulting company, drug company-sponsored events have increased by 11% from 1999 to 2000. Last year drug companies sponsored more than 314,000 meetings. On average, physicians accept invitations to company-sponsored dinners about 50% of the time according to the Scott-Levin report. (http://www.quintiles.com/products_and_services/informatics/scott_levin/press_releases/press_release/1,1254,244,00.html) The report entitled Physician Meeting and Event Audit showed the following trends:
  1. Seventy-two percent of the physicians surveyed indicated an interest in the topic as the biggest motivator. A convenient location and honoraria were also cited (49% and 46%, respectively).
  2. Specialists (especially allergists/immunologists, otolaryngologists and endocrinologists) are more likely to attend, despite the fact that they tend to receive fewer invitations. Cardiologists, pediatricians and primary care physicians are least likely to attend.
  3. Brand-name products were the dominant theme for most events (77%) whereas only 8% were devoted to general therapeutic topics. Fifteen percent of events in 2000 were purely to improve company image.
  4. Physicians are slightly more likely to accept an invitation to an event if CME credits are not provided than if they are (52% acceptance without CME, 44% with CME credits).
  5. More than 50% of physicians attending events at restaurants and hotels indicated an intent to begin or increase prescribing of the promoted product. Forty-seven percent of the physicians surveyed while attending events at other venues indicated they would increase prescribing.
This increase in marketing is occurring at the same time that the American Medical Association is launching a campaign to reduce the influence of the pharmaceutical industry on physicians.

This increase also comes at a time of nearly unrelenting growth in prescription drug costs. A Scott-Levin study predicts a 15-16% increase over the next year in the cost of pharmaceuticals to managed care companies, with pharmaceuticals now making up 18% of overall expenses.

 

But the pharmaceutical industry is spending even more on research, isn't it?

A consumer advocacy group, Families USA, is highlighting the amount of money spent by the pharmaceutical industry on marketing. (http://www.familiesusa.org/media/pdf/drugceos.pdf) Data from the pharmaceutical companies' annual reports strongly suggest that the expenses incurred for marketing and advertising exceed those of research by 1.5-3 fold.

 

Percentage of Total Revenue spent in 2000 (Marketing Top 50 Drugs for Seniors)
Company
Marketing Advertising and Administration
Research
Merck
15%
6%
Pfizer
39%
15%
Bristol-Myers Squibb
30%
11%
Pharmacia
37%
15%
Abbott
21%
10%
American Home Products
38%
13%
Eli Lilly
30%
19%
Schering-Plough
36%
14%
Allergan
42%
13%

 

Prescription drug costs continue to escalate at a rate that is considerably in excess of total healthcare costs. The pharmaceutical industry has long argued that the increases are necessary to maintain a research pipeline (http://www.phrma.org/publications/publications/brochure/questions/). The reality is that the industry spends over twice as much on marketing, advertising and promotion as it does on research, if their annual reports to shareholders are true.