Prescription Drugs: FDA Oversight of Direct-to-Consumer
Advertising Has Limitations (28-OCT-02, GAO-03-177).
Prescription drug spending increased at an annual rate of 18
percent from 1997 through 2001 and is the fastest growing
component of health care spending in the United States. Among the
many reasons cited for this increase are growth in the number of
patients diagnosed with conditions that can be treated with
pharmaceuticals and the development of innovative drugs for some
conditions. Spending on direct-to-consumer (DTC) advertising of
prescription drugs has tripled in recent years. The Food and Drug
Administration (FDA) regulates the promotion of prescription
drugs, including the content of DTC advertisements, under the
authority of the Federal Food, Drug and Cosmetic Act. The act
sets general standards of for FDA's regulation of prescription
drug advertising directed to consumers and physicians.
Regulations implementing the act require that advertisements
present accurate information and fairly represent both the
benefits and the risks of the advertised drug. Pharmaceutical
companies spend more on research and development initiatives than
on all drug promotion activities, including DTC advertising.
According to industry estimates, pharmaceutical companies spent
$30.3 billion on research and development and $19.1 billion on
all promotional activities, which includes $2.7 billion on DTC
advertising, in 2001. DTC advertising appears to increase
prescription drug spending and utilization. Drugs that are
promoted directly to consumers often are among the best selling
drugs, and sales for DTC-advertised drugs have increased faster
than sales for drugs that are not heavily advertised to
consumers. Although generally effective at halting the
dissemination of advertisements it reviews and identifies as
misleading, FDA's oversight of DTC advertising has limitations.
FDA issues regulatory letters for a small percentage of the
advertisements it reviews. Pharmaceutical companies that have
received regulatory letters have invariably ceased dissemination
of the misleading advertisement. However, FDA's oversight has not
prevented some pharmaceutical companies from repeatedly
disseminating new misleading advertisements for the same drug,
and some pharmaceutical companies have failed to submit all newly
disseminated advertisements to FDA for review.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-03-177
ACCNO: A05416
TITLE: Prescription Drugs: FDA Oversight of Direct-to-Consumer
Advertising Has Limitations
DATE: 10/28/2002
SUBJECT: Advertising
Drugs
Marketing
Pharmaceutical industry
Regulatory agencies
Sales promotion
******************************************************************
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GAO-03-177
Report to Congressional Requesters
United States General Accounting Office
GAO
October 2002 PRESCRIPTION DRUGS
FDA Oversight of Direct- to- Consumer Advertising Has Limitations
GAO- 03- 177
Page i GAO- 03- 177 Presciption Drug Advertising Letter 1 Results in Brief
3 Background 5 Pharmaceutical Companies Spend More on Research and
Development than on DTC Advertising 9 DTC Advertising Appears to Increase
Prescription Drug Spending and Utilization 11 FDA*s Oversight of DTC
Advertising Has Limitations 17 Conclusions 24 Recommendation for Executive
Action 24 Agency Comments and Our Evaluation 24 Appendix I Scope and
Methodology 26
Appendix II Surveys of Consumers* Behavior after Seeing or Hearing Direct-
to- Consumer (DTC) Advertisements 28
Appendix III Comments from the Department of Health and Human Services 31
Tables
Table 1: Selected Requirements for Contents of Print and Broadcast Product
Claim Advertisements 7 Table 2: DTC Advertising Spending Compared to
Spending on Total
Promotion and Research and Development from 1997 to 2001 10 Table 3: The
15 Drugs with the Highest DTC Spending, 2000 14 Table 4: DTC Regulatory
Letters Sent by FDA in 2001 20 Table 5: Calendar Days between DDMAC*s
Draft Regulatory Letter
Submission to OCC and Issuance Date, since January 31, 2002 23 Table 6:
Duration of DTC Television Advertisements 23 Contents
Page ii GAO- 03- 177 Presciption Drug Advertising Figures
Figure 1: Spending on Pharmaceutical Promotional Activities, 2001 11
Figure 2: Percentage of Sales for Chronic and Acute Conditions Treated by
the 50 Drugs with the Highest Spending on DTC Advertising, 2000 13
Abbreviations
CDER Center for Drug Evaluation and Research DDMAC Division of Drug
Marketing, Advertising, and
Communications DTC direct- to- consumer FDA Food and Drug Administration
FFDCA Federal Food, Drug and Cosmetic Act HHS Department of Health and
Human Services NIHCM National Institute for Health Care Management
Foundation OCC Office of the Chief Counsel PhRMA Pharmaceutical Research
and Manufacturers of America
Page 1 GAO- 03- 177 Presciption Drug Advertising October 28, 2002 The
Honorable Susan Collins
The Honorable Barbara Mikulski The Honorable James Jeffords United States
Senate
The Honorable Nick Rahall The Honorable Joseph M. Hoeffel House of
Representatives
Prescription drug spending increased at an annual rate of about 18 percent
from 1997 through 2001 and is the fastest growing component of health care
spending in the United States. Among the many reasons cited for this
increase are growth in the number of patients diagnosed with conditions
that can be treated with pharmaceuticals and the development of innovative
drugs for some conditions. 1 Spending on direct- to- consumer (DTC)
advertising of prescription drugs has tripled in recent years.
Pharmaceutical companies promote their products directly to consumers
through advertisements in magazines, newspapers, and consumer brochures;
on the Internet; and on radio and television. They also promote their
products to physicians by sending sales representatives to their offices,
providing free samples for distribution to patients, and advertising in
professional journals. The potential consequences of print and broadcast
DTC advertising have
prompted much debate. Supporters of DTC advertising maintain that it
educates consumers about medical conditions and care options and that the
increased use of prescription drugs that DTC advertising encourages has
improved the public*s health. Critics of DTC advertising contend that it
is sometimes misleading, leads consumers to seek prescription drugs when
other treatments may be more appropriate, and causes some patients to ask
their physician to prescribe new drugs that are more expensive but may not
be more effective than older drugs. Critics also argue that pharmaceutical
companies spend too much money on drug promotion rather than on research
and development initiatives.
1 Robert W. Dubois, Anita J. Chawla, Cheryl A. Neslusan, Mark W. Smith,
and Sally Wade, *Explaining Drug Spending Trends: Does Perception Match
Reality?* Health Affairs, vol. 19 (2000), 231- 39. United States General
Accounting Office Washington, DC 20548
Page 2 GAO- 03- 177 Presciption Drug Advertising The Food and Drug
Administration (FDA) regulates the promotion of prescription drugs,
including the content of DTC advertisements, under
the authority of the Federal Food, Drug and Cosmetic Act (FFDCA). 2 The
act sets general standards for FDA*s regulation of prescription drug
advertising directed to consumers and physicians. Regulations implementing
the act require that advertisements present accurate information and
fairly represent both the benefits and the risks of the advertised drug. 3
The Division of Drug Marketing, Advertising, and Communications (DDMAC)
within FDA*s Center for Drug Evaluation and Research (CDER) is responsible
for implementing the regulations governing DTC advertising. Under the
regulations, pharmaceutical companies are required to submit all drug
advertisements to FDA when they are first disseminated to the public (that
is, broadcast, published, or otherwise distributed). 4 In 1997, FDA issued
draft guidance to clarify and offer options on how these regulations
applied to advertisements
broadcast directly to consumers on radio and television. 5 Since that
time, the number of broadcast advertisements for prescription drugs has
increased greatly. At the same time, the number of regulatory letters sent
by FDA to pharmaceutical companies requesting that the companies remove
misleading advertisements from circulation has decreased, leading some
observers to question FDA*s ability to enforce its regulations. Others
argue that this decrease has occurred because pharmaceutical companies are
doing a better job of meeting FDA*s requirements.
In light of these developments, you asked us to (1) compare spending by
pharmaceutical companies on DTC advertising with spending on all
promotional activities and on research and development, (2) evaluate the
effect of DTC advertising on prescription drug spending and utilization,
and (3) evaluate the extent and effectiveness of FDA*s oversight of DTC
advertising since FDA issued its 1997 draft guidance for broadcast
advertisements.
To assess the trends in spending on DTC advertising, overall promotion,
and research and development, we reviewed recent reports from the
pharmaceutical industry and other organizations. To analyze the effect of
2 21 U. S. C. S: 502( n). 3 21 C. F. R. S: 202.1( e). 4 21 C. F. R. S:
314.81( b)( 3)( i). 5 The guidance was finalized in 1999.
Page 3 GAO- 03- 177 Presciption Drug Advertising DTC advertising on drug
spending and utilization, we reviewed studies on pharmaceutical sales,
examined surveys of consumer responses to DTC
advertising, and reviewed studies on the impact of DTC advertising. 6 To
evaluate the extent and effectiveness of FDA*s oversight of DTC
advertising, we reviewed federal regulations, and regulatory letters, and
interviewed officials from several offices within FDA, including DDMAC. We
also interviewed pharmaceutical industry representatives and other key
stakeholders, including public interest groups and representatives of the
advertising industry. We conducted our work from February 2002 through
September 2002 in accordance with generally accepted government auditing
standards. See appendix I for a detailed discussion of our scope and
methodology.
Pharmaceutical companies spend more on research and development
initiatives than on all drug promotional activities, including DTC
advertising. According to industry estimates, pharmaceutical companies
spent $30.3 billion on research and development and $19.1 billion on all
promotional activities, which includes $2.7 billion on DTC advertising, in
2001. Pharmaceutical companies have increased spending on DTC advertising
more rapidly than they have increased spending on research and
development. Between 1997 and 2001, DTC advertising spending increased 145
percent, while research and development spending increased 59 percent.
Promotion to physicians accounted for more than 80 percent of all
promotional spending by pharmaceutical companies in 2001. Total
promotional spending was equivalent to 12 percent of drug sales in the
United States in 2001.
DTC advertising appears to increase prescription drug spending and
utilization. Drugs that are promoted directly to consumers often are among
the best- selling drugs, and sales for DTC- advertised drugs have
increased faster than sales for drugs that are not heavily advertised to
consumers. Most of the spending increase for heavily advertised drugs is
the result of increased utilization, not price increases. For example,
between 1999 and 2000, the number of prescriptions dispensed for the most
heavily advertised drugs rose 25 percent, but increased only 4 percent for
drugs that were not heavily advertised. Over the same period,
6 In this report, we use three terms to describe the magnitude of
prescription drug use. *Utilization* refers to the number of prescriptions
dispensed. *Spending* and *sales* refer to the amount of money spent for
prescription drugs and are a function of both utilization and price.
Results in Brief
Page 4 GAO- 03- 177 Presciption Drug Advertising prices rose 6 percent for
the most heavily advertised drugs and 9 percent for the others. The
concentration of DTC spending on a small number of
drugs for chronic diseases that are likely to have high sales anyway and
the simultaneous promotion of these drugs to physicians may contribute to
increased utilization and thereby increase sales of DTC- advertised drugs.
The recent research literature shows that DTC advertising may cause
increases in drug utilization and sales in some cases. In addition,
consumer surveys have consistently found that about 5 percent of consumers
(or, by our estimate, about 8.5 million consumers annually) have both
requested and received from their physician a prescription for a
particular drug in response to seeing a DTC advertisement.
While generally effective at halting the dissemination of advertisements
it reviews and identifies as misleading, FDA*s oversight of DTC
advertising has limitations. DDMAC focuses on advertisements that will be
widely circulated or that are the most likely to impart misleading
impressions of a drug to consumers. For example, DDMAC reviews all
broadcast DTC advertisements because of the large number of people who
will see them. FDA issues regulatory letters for a small percentage of the
advertisements it reviews. From August 1997 through August 2002, FDA
issued 88 regulatory letters for violative DTC advertisements. FDA
officials told us that pharmaceutical companies that have received
regulatory letters have invariably ceased dissemination of the misleading
advertisement.
However, FDA*s oversight has not prevented some pharmaceutical companies
from repeatedly disseminating new misleading advertisements for the same
drug, and some pharmaceutical companies have failed to submit in a timely
manner all newly disseminated advertisements to FDA
for review. Furthermore, FDA*s oversight has been adversely affected by a
January 2002 change in its procedures for reviewing draft regulatory
letters that was directed by the Department of Health and Human Services
(HHS). This change has significantly increased the time between DDMAC*s
identification of a misleading advertisement and FDA*s request to remove
it from dissemination, with the result that some regulatory letters may
not be issued until after the advertising campaign has run its course.
In light of the delay caused by the change in policy for review of draft
DTC regulatory letters, we are recommending that HHS expedite the review
of these letters to ensure that misleading DTC advertisements are
withdrawn as soon as possible once identified. In its comments on a draft
of this report, HHS explained that the purpose of the change in procedure
was to ensure that the letters are based on a solid legal foundation and
promote voluntary compliance. HHS agreed that it is important to issue DTC
Page 5 GAO- 03- 177 Presciption Drug Advertising regulatory letters
quickly and said that it intends to reduce the number of days that the
letters are under review.
Prescription drug spending and utilization have increased rapidly in
recent years. Part of the increase is due to growth in the number of
patients diagnosed with conditions that can be treated with
pharmaceuticals and the development of innovative drugs for some
conditions. The promotion
of prescription drugs is regulated by FDA. FDA*s regulations and
subsequently issued guidance contain specific requirements and
explanations regarding the content of advertisements that promote
prescription drugs. When requirements are not met, FDA may issue a
regulatory letter requesting that the advertisement be withdrawn or
revised.
Prescription drug spending has risen steadily over the past decade.
Spending on prescription drugs now represents 10 percent of health care
expenditures in the United States, and adults aged 65 and older spend
nearly 3 percent of their total household expenditures on medications. 7
Increases in overall drug spending are the result of three types of
changes in drug prices and drug use: increases in utilization, that is,
the number of prescriptions dispensed; price increases; and a shift from
older drugs to new, more expensive drugs (newly marketed drugs are
generally more expensive than older drugs in the same class). The National
Institute for Health Care Management Foundation (NIHCM) reported that
overall spending on prescription drugs in the United States increased 17.1
percent from 2000 to 2001: an increase in the number of prescriptions
accounted for a 6.7 percent increase, price increases for a 6. 3 percent
increase, and shifts to higher- cost drugs for a 4.1 percent increase. 8
Prescription drug utilization in the United States has shown a steady
increase over the past decade. The number of prescriptions dispensed in
retail pharmacies has grown at an average annual rate of 6 percent since
7 David H. Kreling, David A. Mott, Joseph B. Wiederholt, Janet Lundy, and
Larry Levitt,
Prescription Drug Trends: A Chartbook Update, pub. no. 3112 (Washington,
D. C.: The Henry J. Kaiser Family Foundation, 2001). 8 NIHCM Foundation,
Prescription Drug Expenditures in 2001: Another Year of Escalating Costs
(Washington, D. C.: NIHCM Foundation, 2002). Background
Reasons for Increased Prescription Drug Spending and Utilization
Page 6 GAO- 03- 177 Presciption Drug Advertising 1992, reaching nearly 3
billion in 2000. 9 Among the factors besides DTC advertising and promotion
to physicians that may contribute to this
increased utilization are an aging population that is more dependent on
multiple medications for treatment; new medications for conditions that
had less effective previous treatments, such as high cholesterol; and
increased insurance coverage for medications. In addition, the number of
patients diagnosed with chronic conditions for which pharmaceutical
treatments are available has increased dramatically. For example, the
number of people with arthritis, one of the most frequent causes of
disability in the United States, increased from an estimated 38 million in
1990 to 43 million in 1997. 10 Furthermore, for some conditions, such as
high cholesterol, increased drug utilization has resulted from biomedical
research that has led to a broadening of the guidelines for treatment with
drugs. 11 Countries that do not allow DTC advertising and have publicly
funded
health systems have also experienced increased drug utilization, and
therefore increased spending, because of these same factors. According to
a drug marketing research firm, retail pharmacy sales from April 2001
through April 2002 rose 16 percent in the United States, 16 percent in
Canada, 10 percent in Germany, and 12 percent in the United Kingdom. 12
FDA regulations describe several types of prescription drug
advertisements, including DTC advertisements, and the extent to which they
are subject to regulation. One type, product claim advertisements, usually
mentions a drug*s name and the condition it is intended to treat and
describes the risks and benefits associated with taking the medication.
9 Kreling, Mott, Wiederholt, Lundy, and Levitt, Prescription Drug Trends:
A Chartbook Update, 8. 10 Centers for Disease Control and Prevention,
*Prevalence of Arthritis* United States,
1997,* MMWR, vol. 50 (2001), 334- 6. 11 National Institutes of Health,
Third Report of the National Cholesterol Education Program (NCEP) Expert
Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in
Adults (Adult Treatment Panel III), Executive Summary, NIH pub. no. 013670
(Rockville, Md.: NIH, May 2001.)
12 IMS Health, Inc.,* IMS Health Reports 11% Growth in Retail Pharmacy
Drug Sales for the 12 Months to April 2002* (Fairfield, Ct.: IMS Health,
2002), http:// www. imshealth. com/ public/ structu (downloaded September
26, 2002). Based on sales from wholesalers to retail pharmacies, with
sales measured in U. S. dollars at a constant exchange rate. FDA*s
Requirements for
the Content of DTC Advertisements
Page 7 GAO- 03- 177 Presciption Drug Advertising The regulations specify,
among other things, that product claim advertisements (1) cannot be false
or misleading; (2) must present a fair
balance between the risks and the benefits of a drug product; (3) must
reveal facts that are material to the representations made in the
advertisement or the consequences of using the product as advertised; and
(4) must, depending on the medium, either disclose all the risks listed in
the product*s labeling or make *adequate provision* to disseminate the
approved product labeling through other means to the advertisement*s
audience. Table 1 shows some of the requirements for print and broadcast
product claim advertisements.
Table 1: Selected Requirements for Contents of Print and Broadcast Product
Claim Advertisements
Advertising medium Regulatory requirements Explanation
Cannot be false or misleading Must present information that is not
inconsistent with product label Must present fair balance Must include
risks and benefits of a drug product Print and
broadcast Must present *facts material* Must present information relevant
to
representations made, and describe consequences that may result from
recommended use Print only Must describe risks Must disclose all risks in
a product*s
labeling Must describe risks Must present major side effects and
contraindications a in audio or audio and visual form Broadcast only Must
make *adequate
provision* for directing consumers to labeling information, or provide a
brief summary of all necessary information related to risks
Must provide additional sources where consumers can find complete
information, such as a toll- free telephone number, a Web site, and a
print advertisement in a magazine, and by contacting their physicians;
otherwise must summarize risks
a Contraindications are symptoms or conditions that make a drug treatment
inadvisable. Sources: 21 C. F. R. S: 202; FDA, Guidance for Industry:
Consumer- directed Broadcast Advertisements (Washington, D. C.: FDA, Aug.
1997).
In 1997, FDA issued draft guidance on how broadcast product claim DTC
advertisements could communicate information about the risks of using a
drug by finding mechanisms by which to get the product labeling
Page 8 GAO- 03- 177 Presciption Drug Advertising information to consumers,
and thereby meet the adequate provision portion of its regulations. 13
Before this provision of the regulation was
clarified in 1997, pharmaceutical companies generally had to provide all
of the risk information associated with the medication during the
broadcast advertisement. Including all of this risk information in a
broadcast DTC advertisement increased the length of the advertisement to
the point that such advertising was largely impractical. After the
guidance was issued, pharmaceutical companies had an alternative to the
requirement that all risks in broadcast advertisements be disclosed.
Pharmaceutical companies
could meet the regulatory requirements by presenting the major side
effects, either in audio or in audio and visual form, and by telling
consumers where to find additional information, including how or where to
obtain the approved product labeling.
A second type of advertisement is reminder advertisements. These may
disclose the name of the product and dosage form (e. g., tablet, syrup) or
cost information, but they are not permitted to present its intended use
or to make any claims or representations about the product. Under FDA
regulations, reminder advertisements are exempt from the risk disclosure
requirements.
A third type of advertisement is help- seeking advertisements, which are
not regulated by FDA. They do not identify drugs by name and generally
discuss a disease or condition and advise the print or broadcast audience
to *see your doctor* for possible treatments. In an effort to stop
dissemination of misleading DTC advertisements, FDA sends regulatory
letters to companies that are in violation of its regulations. These
letters are of two types* untitled letters and warning letters. Untitled
letters address violations such as overstating the effectiveness of the
drug, suggesting a broader range of indicated uses than the drug has been
approved for, and making misleading claims because of inadequate context
or lack of balanced risk information. Warning letters address more serious
violations, including safety or health risks, or continued violations of
the act. Warning letters advise a
pharmaceutical firm that FDA may take further enforcement actions, such as
seeking judicial remediation, without notifying the company, and 13 FDA,
Guidance for Industry: Consumer- directed Broadcast Advertisements
(Washington, D. C.: FDA, Aug. 1997). FDA Regulatory Letters
Page 9 GAO- 03- 177 Presciption Drug Advertising generally ask the firm to
conduct a new advertising campaign to correct inaccurate impressions left
by the advertisement. A company that receives either type of letter from
FDA is asked to submit a written response to the
agency within 14 days describing the remedial actions it has taken.
Pharmaceutical companies spend more on research and development than on
DTC advertising or on all promotional activities combined, according to
industry sources. Nonetheless, spending for DTC advertising has increased
much faster than spending for all promotional activities or for research
and development. More than 80 percent of all promotional spending is
directed toward physicians rather than consumers.
According to industry analyses, spending on research and development was
more than 10 times higher than spending on DTC advertising in 2001. 14
Pharmaceutical companies spent an estimated $30.3 billion on research
and development and $19.1 billion on all promotional activities, including
$2.7 billion on DTC advertising in 2001. However, the growth rate of
spending on DTC advertising is higher than the rate of increase for
spending on total promotion or spending on research and development. As
table 2 shows, from 1997 through 2001, spending on DTC advertising
increased from $1.1 billion to an estimated $2.7 billion, spending on
total promotion increased from $11.0 billion to an estimated $19.1
billion, and research and development spending increased from $19.0
billion to an estimated $30.3 billion.
14 Pharmaceutical Research and Manufacturers of America, Pharmaceutical
Industry Profile 2002 (Washington, D. C.: Pharmaceutical Research and
Manufacturers of America, 2002); IMS Health Integrated Promotional
Services, *Total U. S. Promotional Spending by Type, 2001* (Fairfield,
Ct.: IMS Health, 2002), http:// www. imshealth. com/ public/ structu
(downloaded July 17, 2002). We did not independently verify the amounts
reported by the Pharmaceutical Research and Manufacturers of America and
IMS Health. However, many
researchers have consistently cited these data sources, and they represent
the best available information. Pharmaceutical Companies Spend
More on Research and Development than on DTC Advertising
Despite Rapid Growth in Spending on DTC Advertising, Pharmaceutical
Companies Spend More on Research and Development
Page 10 GAO- 03- 177 Presciption Drug Advertising Table 2: DTC Advertising
Spending Compared to Spending on Total Promotion and Research and
Development from 1997 to 2001
Dollars in billions 1997 1998 1999 2000 2001 Percentage
spending increase, 1997- 2001
DTC $1.1 $1.3 $1.8 $2.5 $2.7 145 Total promotion a 11.0 12.5 13.9 15.7
19.1 74 Research and development 19.0 21.1 22.7 26.0 30.3 b 59
a Total promotion includes DTC advertising. b Estimated spending on
research and development.
Sources: For 1997 to 2000 data, Pharmaceutical Research and Manufacturers
of America,
Pharmaceutical Industry Profile 2002, 18, 75; for 2001 promotional
spending estimates, IMS Health, *Total U. S. Promotional Spending by Type,
2001.*
In recent years there has been a shift of DTC advertising from print media
to television broadcasts. 15 The percentage of DTC spending devoted to
print advertisements declined from 74 percent in 1997 to 35 percent in
2001. Conversely, spending on television advertising increased from 25
percent of all DTC spending in 1997 to 64 percent in 2001. Prescription
drug promotion on television escalated from 25 percent to 53 percent of
the total spending on DTC advertising from 1997 to 1998.
Most promotional spending is targeted to physicians. In each year from
1997 to 2001, providing samples to office- based and hospital- based
physicians and sending sales representatives to meet with physicians
(practices known as sampling and detailing, respectively) accounted for
more than 80 percent of expenditures on promotional activities. 16 (See
fig. 1.) The ratio of total promotional spending to drug sales remained
fairly
15 Television broadcasts constitute the majority of nonprint DTC
advertising spending. 16 Kreling, Mott, Wiederholt, Lundy, and Levitt,
Prescription Drug Trends: A Chartbook Update; IMS Health Integrated
Promotional Services, *Total U. S. Promotional Spending by Type, 2001.*
These figures do not include educational meetings arranged by
pharmaceutical companies for physicians, which are not generally
considered to be promotional activities. Pharmaceutical companies spent
about $1. 9 billion on educational meetings in 2000. (See NIHCM
Foundation, Prescription Drugs and Mass Media Advertising, 2000
(Washington, D. C.: NIHCM Foundation, 2001)). Most Promotional Spending Is
Directed to
Physicians
Page 11 GAO- 03- 177 Presciption Drug Advertising constant from 1997 to
2001. In 2001, promotional spending was equivalent to 12 percent of drug
sales in the United States.
Figure 1: Spending on Pharmaceutical Promotional Activities, 2001
a The practice of providing samples during sales visits to office- based
physicians. b Sales activity of pharmaceutical sales representatives
directed to office- based and hospital- based physicians. Source: IMS
Health, *Total U. S. Promotional Spending by Type, 2001.*
Drugs that are promoted directly to consumers often are among the
bestselling drugs, and sales for DTC- advertised drugs have increased
faster than sales for drugs that are not heavily advertised to consumers.
Most of the spending increase for heavily advertised drugs is the result
of increased utilization, not price increases. DTC advertising is
concentrated among a small number of drugs for chronic conditions and many
of these same drugs are also promoted to physicians, both factors that may
lead to increased sales. To date, the few studies that have examined the
effects of DTC spending on prescription drug spending and utilization have
found that DTC advertising increases both. In addition, there is clear
evidence
from consumer surveys that DTC advertising encourages consumers to request
prescriptions for specific brand- name drugs from their physicians and
that some physicians provide the requested prescription. DTC Advertising
Appears to Increase Prescription Drug Spending and Utilization
Page 12 GAO- 03- 177 Presciption Drug Advertising Drugs with high DTC
spending are among the best- selling drugs. For example, in 2000, 22 of
the 50 drugs with the highest DTC spending were among the top 50 in sales.
17 Furthermore, sales of drugs with the highest
DTC spending have risen more quickly than sales of other drugs. For
example, NIHCM reported that expenditures for the 50 most heavily
advertised drugs increased 32 percent between 1999 and 2000, while
expenditures for all other drugs increased 14 percent. Most of this
expenditure increase results from increased utilization (that is, an
increase in prescriptions filled), not from price increases. Among the 50
most heavily advertised drugs, the number of prescriptions dispensed rose
25 percent between 1999 and 2000, compared to a 4 percent increase for
other drugs. During the same period, prices increased 6 percent for the
heavily advertised drugs, and 9 percent for other drugs.
Concentration of DTC spending on a small number of drugs for chronic
conditions that are likely to have high sales and the promotion of these
same drugs to physicians may also contribute to increased utilization.
Almost all spending on DTC advertising is concentrated among a small
number of drugs that treat chronic conditions and therefore must be taken
repeatedly. (See fig. 2.) These drugs are relatively new and are still
under patent protection. According to NIHCM, the 50 drugs with the highest
DTC advertising spending in 2000 accounted for 95 percent of all DTC
advertising spending that year, and the top 15 DTC- advertised drugs
accounted for 54 percent of all DTC advertising spending. All of the top
15 DTC- advertised drugs were for chronic conditions: 6 for allergy or
asthma, 3 for high cholesterol, 2 for arthritis, and 1 each for acid
reflux, depression, obesity, and impotence. (See table 3.) Only one of the
50 most heavily advertised drugs was an antibiotic, a drug class that is
used episodically. In some drug categories, a small number of
pharmaceuticals that are heavily advertised account for the vast majority
of sales. For example, in 2000 three oral antihistamines, Claritin,
Allegra, and Zyrtec, accounted for 86 percent of all oral antihistamine
sales, and all three of them were among the 15 most heavily advertised
drugs.
17 NIHCM Foundation, Prescription Drugs and Mass Media Advertising, 2000.
Many DTC- Advertised Drugs Are Best Sellers
DTC- Advertised Drugs Are for Chronic Conditions and Are Often Promoted to
Physicians
Page 13 GAO- 03- 177 Presciption Drug Advertising Figure 2: Percentage of
Sales for Chronic and Acute Conditions Treated by the 50 Drugs with the
Highest Spending on DTC Advertising, 2000
Source: GAO analysis of data from NIHCM Foundation, Prescription Drugs and
Mass Media Advertising, 2000.
Page 14 GAO- 03- 177 Presciption Drug Advertising Table 3: The 15 Drugs
with the Highest DTC Spending, 2000 Drug Condition
Percentage of DTC spending for all
drugs a Percentage of sales for all drugs b
Vioxx Arthritis 7.1 1.2 Prilosec Acid reflux 4.8 3.1 Claritin Allergy 4.4
1.5 Paxil Depression 4.1 1.4 Zocor High cholesterol 4.0 1.7 Viagra
Impotence 4.0 0.6 Celebrex Arthritis 3.5 1.5 Flonase Allergy 3.3 0.5
Allegra Allergy 3.0 0.8 Meridia Obesity 2.9 0.1 Flovent Asthma 2.8 0.5
Pravachol High cholesterol 2.7 0.9 Zyrtec Allergy 2.7 0.6 Singulair Asthma
2.6 0.5 Lipitor High cholesterol 2.6 2.8
Total 54.5 17.7
a Total DTC spending for all drugs was $2.5 billion. b Sales for all drugs
totaled $132 billion.
Source: Kreling, Mott, Wiederholt, Lundy, and Levitt, Prescription Drug
Trends: A Chartbook Update,
32; NIHCM Foundation, Prescription Drugs and Mass Media Advertising, 2000,
9.
Many of the same drugs that are promoted through DTC advertising are also
promoted to physicians, meaning that any sales increases may be due in
part to that promotion. For example, according to industry analysts, half
of the 10 drugs with the highest DTC spending were also among the 10 drugs
with the greatest volume of samples distributed to physicians in 2000. 18
Over 70 percent of physicians surveyed in one study said that they are
more likely to prescribe the brand- name medication requested by the
patient if they have a free sample available. 19 In addition, there is a
growing trend to announce through DTC venues such as television, newspaper
18 IMS Health Inc., *Product Sampling Continues to Spike in US*
(Fairfield, Ct.: IMS Health, 2002), http:// www. imshealth. com/ public/
structure/ dispcontent (downloaded May 16, 2002). 19 Barbara Henderson,
*IMS Study: U. S. Physicians Responsive to Patient Requests for Brand Name
Drugs* (Fairfield, Ct.: IMS Health, 2002), http:// www. imshealth. com/
public/ structure/ dispcontent (downloaded May 16, 2002).
Page 15 GAO- 03- 177 Presciption Drug Advertising advertisements, and the
Internet that free samples are available from physicians. Thus
pharmaceutical companies are making consumers aware of these products and
providing samples to physicians so that samples are
available when consumers request them. Researchers have only recently
begun to examine the effects of DTC advertising on drug utilization and
sales. The few studies we identified have conflicting findings but, on the
whole, suggest that DTC advertising
may increase drug utilization and sales. One study looked at the
utilization of an injectable migraine headache treatment in cities in
which a DTC advertising campaign was conducted and cities with no
advertising. During the first year the drug was marketed, February 1993 to
February 1994, the drug was dispensed nearly 10 percent more in cities in
which DTC advertisements were disseminated. 20 Additionally, three recent
studies that examined the joint effects of DTC advertising and promotion
to physicians all found that DTC advertising significantly increased drug
sales. 21 Each of the studies found that DTC advertising increased sales
within the advertised drug*s class (implying, for example, that
advertising for one antihistamine increased sales for other antihistamines
as well). 22 Two of the studies estimated that each 10 percent increase in
DTC
spending within a drug class increased sales in that class by 1 percent.
23 20 Lisa R. Basara, *The Impact of a Direct- to- Consumer Prescription
Medication Advertising Campaign on New Prescription Volume,* Drug
Information Journal, vol. 30 (1996), 715- 29. 21 Meredith B. Rosenthal,
Julie M. Donohue, Arnold M. Epstein, and Richard G. Frank, Demand Effects
of Recent Changes in Prescription Drug Promotion, June 22, 2002
(forthcoming, available on the Web as of Oct. 21, 2002, at
http:// www. nber. org/ books/ garber6/ index. html); Scott Neslin, *ROI
Analysis of Pharmaceutical Promotion (RAPP): An Independent Study*
(unpublished presentation, Hanover, N. H.: Dartmouth College, Amos Tuck
School of Business, May 2001); Marta E. Wosinska, *The Economics of
Prescription Drug Advertising* (Ph. D. diss., University of California,
Berkeley, 2002).
22 Each of the studies also found that promotion to physicians was more
cost effective than DTC advertising. 23 This estimate implies that DTC
advertising can substantially boost sales for high- volume drugs because
sales figures are often much larger than advertising expenditures. For
example, in 2000 the top- selling drug, Prilosec, had sales of $4.1
billion and DTC advertising expenditures of $108 million. If this estimate
applied to individual prescription drugs, each increase in DTC spending of
$1 million would have increased sales of Prilosec by $4 million. Research
Studies Suggest That DTC Advertising Has
Increased Utilization and Sales of Advertised Drugs
Page 16 GAO- 03- 177 Presciption Drug Advertising An exception to this
pattern of findings is a study on the effects of fluctuations in the
intensity of DTC advertising on sales of cholesterollowering
drugs from 1995 to 2000. While sales of cholesterol- lowering drugs
increased substantially over that period, this study found that variations
in the amount of DTC advertising were not statistically related to either
sales of particular brand- name drugs or sales of cholesterollowering
drugs as a class. 24 Unlike the studies described above, this research did
not consider the effects of promotion to physicians.
Surveys conducted by FDA and private organizations consistently show that
DTC advertisements have an impact on whether consumers request and receive
a specific brand- name prescription from their physician. (See app. II for
a list of consumer surveys.) In several of these surveys, consumers were
asked whether they had seen an advertisement for a prescription drug and
whether seeing the advertisement resulted in discussing the medication
with their doctor and receiving the prescription. Most consumers (65 to 85
percent) remembered seeing a DTC advertisement. A subset of consumers who
saw an advertisement discussed the medication with their doctor. The
percentage of patients asking their physicians about a prescription for a
specific drug was consistent across studies, about 30 to 35 percent of
those who remembered seeing a DTC advertisement. One study estimated that
the 32 percent of consumers in a 2001 survey who had discussed a DTC
advertisement with their doctor translated into approximately 61.1 million
consumers asking about specific medications. In the consumer surveys we
examined, the percentage of consumers who, in response to a DTC
advertisement, requested and received a prescription from their physician
for a drug they were not currently taking was generally about 5 percent
(ranging from 2 percent to 10 percent). By our estimate, this means that
about 8.5 million consumers received a prescription after viewing a DTC
advertisement and asking their physician for the drug in 2000. 25 24 John
E. Calfee, Clifford Winston, and Randolph Stempski, Direct- to- Consumer
Advertising and the Demand for Cholesterol- reducing Drugs (Washington, D.
C.: American Enterprise Institute, 2001).
25 Based on figures in the 2001 Statistical Abstract of the United States,
we estimate that about 170 million adults visited a physician in 2000; 8.
5 million is 5 percent of 170 million. Consumer Surveys Have
Found That DTC Advertisements Influence Consumers to Ask Physicians for
Brand- name Drugs
Page 17 GAO- 03- 177 Presciption Drug Advertising FDA*s oversight of DTC
advertising is focused on advertisements that have the greatest exposure
or the greatest potential to be misleading.
Pharmaceutical companies comply with FDA*s requests to cease dissemination
of misleading DTC advertisements. However, some pharmaceutical companies
have repeatedly disseminated misleading
advertisements for the same drug, and pharmaceutical companies have failed
to submit, or to submit in a timely manner, all newly disseminated
advertisements to FDA for review. A recent change in the procedures for
reviewing draft regulatory letters has adversely affected FDA*s ability to
issue regulatory letters in a timely manner.
As of June 2002, five DDMAC staff were dedicated to reviewing DTC
advertisements, and two DTC review slots were vacant. 26 DDMAC*s reviewers
focus on advertisements that will receive the greatest exposure or have
the most potential to impart misleading impressions of a drug to
consumers. These include broadcast advertisements, print advertisements
appearing in high- circulation periodicals, initial advertising campaigns
for newly marketed drugs, and new advertisements from pharmaceutical
companies that have previously been cited for disseminating misleading
advertisements. DDMAC officials told us that 248 broadcast advertisements
and an unknown number of DTC print advertisements were submitted to it at
the time of their dissemination in 2001. DDMAC staff reviewed all the
broadcast advertisements it received in 2001. DDMAC does not keep track of
the number of print advertisements it reviewed. 27 DDMAC also received and
reviewed 230 complaints about allegedly misleading advertisements (for
both consumer- directed and health professional- directed materials) in
2001, the majority of which were
submitted by competing pharmaceutical companies. DDMAC investigates all
tips concerning potentially misleading advertisements. Although FDA
generally does not have the authority to preapprove advertisements before
they are disseminated, companies may voluntarily submit their materials to
FDA for advisory comments before launching an advertisement. DDMAC gave
advisory comments on 128 broadcast advertisements in
26 In total, DDMAC had 39 full- time- equivalent positions in fiscal year
2002, most of which were dedicated to the oversight of promotional
communications directed to physicians. 27 DDMAC tabulates all of the
pieces of promotional material submitted to it, but, with the exception of
broadcast advertisements, it does not categorize the types of submissions
it
receives. DDMAC officials told us that it received approximately 34,000
pieces of promotional material, including consumer advertisements and
promotions to physicians, in 2001, but that they do not know how many DTC
print advertisements were submitted. FDA*s Oversight of
DTC Advertising Has Limitations
DDMAC Targets Reviews
Page 18 GAO- 03- 177 Presciption Drug Advertising 2001. In addition to
monitoring and review activities, DDMAC conducts research to better
understand consumer and physician behavior related to DTC advertising.
When FDA identifies a violative DTC advertisement, it sends a regulatory
letter to the company responsible for the advertisement asking that the
company cease disseminating the advertisement. FDA issues regulatory
letters for only a small percentage of the advertisements it reviews. For
example, FDA has issued letters for about 5 percent of the broadcast
advertisements it reviewed between 1999 and 2001. In total, FDA issued 88
regulatory letters for DTC advertisements between August 1997 and August
2002* 44 for broadcast advertisements, 35 for print advertisements, and 9
for both broadcast and print advertisements. 28 Almost all of the
regulatory letters were untitled letters, which are for less
serious violations of FFDCA; for more serious violations, FDA issued three
warning letters for broadcast advertisements and one for a print
advertisement.
FDA*s warning letters often cite multiple, serious offenses or violations
that raise public health issues. For example, FDA*s January 21, 1999,
warning letter to Novartis Pharmaceuticals Corporation about the marketing
of Lescol, a cholesterol- lowering drug, described four violations: (1)
Novartis did not submit the broadcast advertisement to FDA when it was
disseminated, as required by the regulations, resulting in *violative
messages being disseminated to a far larger consumer audience than might
have otherwise occurred*; (2) the advertisement falsely stated that
treatment with Lescol was as effective as treatment with other
cholesterol- lowering agents named in the advertisement; (3) the
advertisement falsely stated that treatment with Lescol was less expensive
than treatment with other named cholesterol- lowering agents; and (4) the
advertisement minimized the risk of potentially serious side effects,
including liver function abnormalities and muscle pain or weakness.
Table 4 lists the 14 DTC regulatory letters issued by FDA in 2001 and
describes the violations cited in each. One- half of the letters cited
advertisements that made misleading claims about a drug*s efficacy. For
28 FDA*s DTC regulatory letters are posted on the Web at http:// www. fda.
gov/ cder/ warn/. FDA sometimes sends a single letter for violative DTC
advertisements that appear in both broadcast and print mediums. FDA Sends
Regulatory Letters When It Identifies a Violation
Page 19 GAO- 03- 177 Presciption Drug Advertising example, FDA*s August
2001 letter concerning Luxiq, a cream for the treatment of psoriasis and
eczema, noted that the advertisement claimed
*highly effective relief in three out of four patients,* even though the
clinical trial described on the product labeling found that Luxiq*s
success at improving various symptoms ranged from 41 percent to 67
percent. The Luxiq advertisement also claimed that it reduced symptoms
*within days,*
even though the clinical trial results were for patients who used it for 4
weeks. Similarly, in November 2001, FDA cited an advertisement for
Protopic Ointment, a treatment for allergic dermatitis, which included
models with completely smooth skin. FDA concluded that this implied that
patients would experience 100 percent improvement of their symptoms with
the ointment, even though the product labeling noted that only onetenth of
the patients taking the drug showed complete improvement. Regulatory
letters have also cited advertisements for minimizing risk information.
For example, FDA*s October 2001 letter about an advertisement for Differin
Gel, an acne medication, claimed that risk information was inadequately
presented because, *During the audio presentation of the major risk
information, there are numerous visual distractions that interfere with
the viewer*s ability to listen to * the information * [including] numerous
scene changes and quick camera movements.* Still other advertisements have
been cited because FDA identified them as being a different type of
advertisement than apparently intended by the pharmaceutical firm. FDA*s
January 2001 letter concerning an advertisement for the acid reflux
medication Prilosec, for instance, noted that the advertisement did not
mention the drug by name and did not include information about the drug*s
approved indication and usage. The manufacturer apparently intended it to
be a help- seeking advertisement that did not require such information.
However, FDA found that, in essence, the advertisement was a product claim
advertisement because it discussed acid reflux in conjunction with *the
purple pill,* and at the time Prilosec was the only purple pill that
treated acid reflux.
Page 20 GAO- 03- 177 Presciption Drug Advertising Table 4: DTC Regulatory
Letters Sent by FDA in 2001 Drug Condition Company Date Type of letter
Violation
Prilosec Acid reflux AstraZeneca 1/ 3/ 01 Untitled Provides inadequate
information on approved product indication and use, lacks fair balance
Protopic Eczema Fujisawa Healthcare 2/ 16/ 01 Untitled Fails to provide
necessary information for making product claims Xenical Obesity Hoffmann-
La Roche 3/ 30/ 01 Untitled Provides inadequate information
on full indication, fails to fulfill *adequate provision* a requirements,
lacks fair balance
Plavix Heart disease Sanofi- Synthelabo 6/ 8/ 01 Untitled Minimizes role
of physician, fails to fulfill *adequate provision* requirements Avandia
Diabetes GlaxoSmithKline 6/ 28/ 01 Untitled Minimizes risks Ditropan XL
Overactive
bladder Alza 7/ 12/ 01 Untitled Overstates efficacy, minimizes risks,
fails to convey indications
Cerezyme Gaucher disease Genzyme 7/ 13/ 01 Untitled Minimizes risks, fails
to fulfill
*adequate provision* requirements, fails to disclose prescription drug
status Niaspan High
cholesterol Kos Pharmaceuticals 7/ 13/ 01 Warning Fails to present
significant risks; makes misleading efficacy
claims; implied use is inconsistent with product labeling Luxiq Psoriasis
and
eczema Connetics 8/ 13/ 01 Untitled Overstates efficacy, misleading
preference, compliance, and
superiority claims Differin Acne Galderma Laboratories 10/ 1/ 01 Untitled
Provides inadequate risk
information in relation to effectiveness information Actonel Osteoporosis
Proctor & Gamble 10/ 9/ 01 Untitled Minimizes role of health care
provider, fails to fulfill *adequate
provision* requirements, provides inadequate risk information Protopic
Eczema Fujisawa Healthcare 11/ 14/ 01 Untitled Overstates efficacy,
broadens approved product indication,
minimizes risk Nolvadex Breast cancer AstraZeneca 12/ 14/ 01 Untitled
Makes misleading efficacy
claims, minimizes risks, fails to comply with postmarketing reporting
requirements
a Unless broadcast advertisements provide a brief summary of all risks,
they must make *adequate provision* for the dissemination of the approved
product labeling. Source: FDA, Center for Drug Evaluation and Research,
*Warning Letters and Notice of Violation Letters to Pharmaceutical
Companies* (Rockville, MD.: U. S. Food and Drug Administration), http://
www. fda. gov/ cder/ warn/ (downloaded Sept. 9, 2002).
Page 21 GAO- 03- 177 Presciption Drug Advertising FDA officials told us
that pharmaceutical companies have complied with FDA*s requests to cease
dissemination of misleading DTC drug
advertisements in every case to date. For that reason, and because FDA
does not want to remove a beneficial drug from the market, FDA has yet to
employ any of the harsher remedies available to it. FDA, through the
Department of Justice, can initiate court action to seize drugs for which
advertisements are false or misleading. FDA may also ask a court to stop
the advertisement and request the company to run a corrective campaign.
FFDCA provides for criminal penalties for violative prescription drug
advertising. FDA*s regulatory letters do not completely deter
pharmaceutical
companies from making misleading claims in subsequent advertisements.
Since 1997, FDA has issued repeated regulatory letters to several
pharmaceutical companies, including 14 to GlaxoSmithKline, 6 to Schering
Corporation, and 5 to Merck & Co. 29 Some companies have received multiple
regulatory letters over time for new advertisements promoting
the same drug. For example, FDA issued four separate regulatory letters,
one of which was a warning letter, to stop misleading advertisements for
the allergy drug Flonase marketed by Glaxo Wellcome in 1999 and 2000. The
untitled letters were for unsubstantiated efficacy claims and for lack of
fair balance. The warning letter was for failure to provide any risk
information on the major side effects and contraindications of the drug,
failure to make adequate provision for disseminating the product labeling,
and failure to submit the advertisement to FDA. In the past 4 years, FDA
has issued four regulatory letters to Pfizer regarding broadcast and print
advertisements for its cholesterol- lowering drug, Lipitor. Among other
infractions, FDA noted that the advertisements gave the false impression
that Lipitor can reduce heart disease and falsely claimed that Lipitor is
safer than competing products.
While FDA*s enforcement actions have succeeded in removing from
dissemination misleading DTC advertisements, the effectiveness of its
oversight is limited in two respects. First, FDA*s ability to assess the
compliance of pharmaceutical companies with its DTC advertising
regulations is compromised because FDA cannot verify that it receives all
29 Company names listed here are based on the names as of the date of the
last regulatory letter that they received. FDA*s Regulatory Letters
Are Effective in Halting Dissemination of Misleading Advertisements
Some Pharmaceutical Companies Have Been Cited for Repeatedly Disseminating
Different Misleading Advertisements
Effectiveness of FDA*s Oversight of DTC Advertising Is Limited in Two Ways
Page 22 GAO- 03- 177 Presciption Drug Advertising newly disseminated
advertisements from pharmaceutical companies. FDA has issued six
regulatory letters for misleading advertisements since 1997
that cited pharmaceutical companies for failing to submit their
advertisements to the agency when they were first disseminated.
FDA officials told us that the agency contracts with a commercial service
that monitors television advertising placement to find advertisements that
pharmaceutical companies have failed to submit to the agency. The service
monitors six cable television networks and the New York City affiliates of
the four major networks and PBS. 30 This service does not identify all
advertisements that are broadcast on smaller networks, such as some cable
television stations, or in some local markets. Indeed, in one case a
misleading advertisement was broadcast in 2 calendar years in Puerto Rico
before FDA became aware of it.
Second, a recent change in the Department of Health and Human Services
policy for reviewing regulatory letters has sharply reduced FDA*s
effectiveness in issuing untitled and warning letters in a timely manner.
The ability to issue regulatory letters quickly after an advertising
violation is identified is a key component of FDA*s oversight of DTC
advertising. Any inaccurate impressions of a drug that are caused by a
misleading advertisement are minimized if the advertisement is quickly
removed from dissemination. Prior to the policy change, FDA officials told
us that
regulatory letters were issued directly by DDMAC within several days of
its receipt of an advertisement that it identified as misleading. On
November 29, 2001, HHS instructed FDA that no untitled or warning letters
could be issued until FDA*s Office of the Chief Counsel (OCC) reviewed
them. HHS implemented this new policy to ensure that all draft warning and
untitled letters from FDA were reviewed for *legal sufficiency and
consistency with agency policy.* FDA officials told us that OCC
implemented this policy for regulatory letters on January 31, 2002, and
that OCC set the goal of reviewing all draft regulatory letters from DDMAC
within 45 working days. 31 30 The cable networks monitored are CNBC, CNN,
CSPAN, CSPAN2, MSNBC, and CNNFN. The network affiliates monitored are
WNBC, WABC, WCBS, WNET, and WNYW. 31 The 45- working- day goal is only for
OCC*s own work on a draft letter. Thus OCC*s clock stops when it returns a
draft letter to DDMAC for clarification or further research, and it
resumes when DDMAC resubmits the draft letter.
Page 23 GAO- 03- 177 Presciption Drug Advertising Since the policy change,
OCC*s reviews of draft regulatory letters from FDA have taken so long that
misleading advertisements may have completed their broadcast life cycle
before FDA issued the letters. FDA
provided us with information indicating that DDMAC submitted five draft
DTC regulatory letters between January 31, 2002, and September 5, 2002.
All of the letters have been issued. The letters were issued from 13 to 78
calendar days after they were first submitted to OCC by DDMAC (see table
5). As table 6 shows, many television DTC advertisements are on the air
for only a short time* about one- fifth of them for 1 month, and about
onethird for 2 months or less. Although we do not know the broadcast
status of the advertisements targeted by DDMAC*s draft regulatory letters,
there is a possibility that misleading advertisements could remain on the
air after they are identified by DDMAC if FDA maintains its current review
policies.
Table 5: Calendar Days between DDMAC*s Draft Regulatory Letter Submission
to OCC and Issuance Date, since January 31, 2002
Date submitted to OCC by DDMAC Date issued Calendar days between
submission
by DDMAC and issuance
3/ 22/ 02 5/ 16/ 02 55 4/ 4/ 02 5/ 13/ 02 39 4/ 8/ 02 4/ 30/ 02 22 5/ 16/
02 8/ 2/ 02 78 7/ 30/ 02 8/ 12/ 02 13
Source: GAO analysis of data provided by FDA.
Table 6: Duration of DTC Television Advertisements Months on the air
Percentage
1 22 2 10 3- 6 30 7- 12 29 13- 28 9
Source: Analysis by Pfizer, Inc., of data from Nielsen Monitor Plus for
303 unique television advertisements for prescription drugs that aired
between 1997 and mid- 2001.
Page 24 GAO- 03- 177 Presciption Drug Advertising DTC advertising prompts
millions of consumers to ask their doctors for prescriptions for specific
brand- name drugs. As a result, it is important
that FDA act effectively to minimize the public*s exposure to misleading
DTC advertisements. We found that FDA*s oversight is generally effective
at halting the dissemination of advertisements it reviews and identifies
as misleading. The recent change directed by HHS in FDA*s procedures for
reviewing draft regulatory letters has adversely affected FDA*s ability to
enforce compliance with its regulations. Without more timely action, DTC
advertisements that DDMAC has identified as misleading can remain on the
air too long.
To ensure that FDA*s enforcement actions are timely, we recommend that HHS
reduce the amount of time for internal review of draft regulatory letters.
HHS reviewed a draft of this report and provided comments, which are
included as appendix III. HHS generally agreed with our description of
FDA*s oversight of DTC advertising. HHS explained that the intent of its
policy change requiring FDA*s OCC to review all draft regulatory letters
is to ensure that the letters are based on a solid legal foundation and
promote voluntary compliance. Although we did not conduct a legal analysis
of the letters that FDA issued either before or after the policy change,
we found that FDA*s regulatory letters issued before this policy
took effect already were successful at halting the dissemination of
misleading DTC advertisements. HHS agreed with us that it is important to
issue DTC advertising enforcement letters quickly and therefore has
established a goal of issuing the letters within 15 working days of review
at OCC. HHS also provided technical comments, which we incorporated as
appropriate. As agreed with your offices, unless you publicly announce its
contents
earlier, we plan no further distribution of this report until 30 days from
its date. We will then send copies to the Secretary of Health and Human
Services, the Commissioner of FDA, and appropriate congressional
committees. We will also make copies available to others on request. In
addition, the report will be available at no charge on GAO*s Web site at
http:// www. gao. gov. Conclusions
Recommendation for Executive Action
Agency Comments and Our Evaluation
Page 25 GAO- 03- 177 Presciption Drug Advertising If you or your staffs
have any questions, please contact me at (202) 512- 7119 or Martin T.
Gahart at (202) 512- 3596. Key contributors to
this assignment were Louise Duhamel, Anne Dievler, and Roseanne Price.
Janet Heinrich Director, Health Care* Public Health Issues
Appendix I: Scope and Methodology Page 26 GAO- 03- 177 Presciption Drug
Advertising This study concerns FDA*s oversight of DTC advertising of
prescription drugs, which takes place within DDMAC, a division of CDER. We
therefore
did not examine FDA*s oversight of advertising in other areas, such as
biological products, and we did not look at advertising issues concerning
nonprescription medicines or dietary supplements.
To assess the trends in spending on DTC advertising, overall promotion,
and research and development, we reviewed recent reports from the Kaiser
Family Foundation, the Pharmaceutical Research and Manufacturers of
America (PhRMA), NIHCM, IMS Health, and others. We did not independently
verify the data reported by PhRMA and IMS Health. However, these data
sources are consistently cited across studies because drug companies
report their spending directly to these agencies, and they
represent the best available information. The scope of our analysis
focused on trends since 1997 because 1997 was when FDA issued its draft
guidance changing the requirements for broadcast advertisements.
To analyze the impact of DTC advertising on drug spending and utilization*
as measured by prescriptions dispensed* we reviewed studies on
pharmaceutical sales and examined surveys of consumer responses to DTC
advertising. For sales information, we primarily relied on data from IMS
Health and looked at sales of the most heavily advertised drugs. To
understand consumer responses to DTC advertising, we relied on surveys
conducted by FDA, Prevention Magazine, Kaiser Family Foundation, National
Consumers League, AARP, and other researchers. Some of these groups have
repeated their surveys over time. For example, FDA conducted consumer
surveys in 1999 and 2002. Prevention Magazine, and its parent company,
Rodale, Inc., have conducted ongoing research on consumer reaction to DTC
advertising since 1997 with technical assistance from other groups. Its
1997 survey was conducted with the American
Pharmaceutical Association; its 1998, 1999, and 2000 surveys were
conducted with technical assistance from FDA; and its most recent 2001
survey was conducted with FDA and Princeton Survey Research Associates.
FDA*s and Prevention Magazine*s surveys have been conducted with
nationally representative samples of adults. We also reviewed the
literature for published and unpublished articles and reports on the
effects of DTC advertising and other factors on prescription drug spending
and utilization. The studies with the strongest methodologies were three
unpublished studies, one of which is in press; the second is a recent Ph.
D. dissertation; and the third was conducted by a university researcher
and was presented to pharmaceutical industry representatives in May 2001.
All of these unpublished studies used data from IMS Health Appendix I:
Scope and Methodology
Appendix I: Scope and Methodology Page 27 GAO- 03- 177 Presciption Drug
Advertising and other firms that collect information about the
pharmaceutical industry.
To assess FDA*s effectiveness in regulating DTC advertisements, we
reviewed federal regulations and documents and interviewed officials from
several offices within FDA, including CDER, DDMAC, and OCC. We analyzed
regulatory letters issued by FDA between August 1997 and August 2002. To
avoid double counting, we separated the regulatory letters into three
categories: letters for broadcast violations, letters for print
violations, and overlapping letters that address both broadcast and print
violations. We did not review the content of advertisements, nor make an
independent assessment of whether advertisements complied with the FDA
regulations and guidance.
Finally, we interviewed and consulted with pharmaceutical industry
representatives from Pfizer, Inc., PhRMA, and other key stakeholders,
including the American Medical Association, Public Citizen, the National
Advertising Review Council, the Freedom to Advertise Coalition, and
RxHealth Value. RxHealth Value is a national coalition of consumer,
provider, business, and employer groups; labor unions; insurers and health
plans; pharmacy benefits management organizations; and academic
researchers.
We conducted our work from February 2002 through September 2002 in
accordance with generally accepted government auditing standards.
Appendix II: Surveys of Consumers* Behavior after Seeing or Hearing
Direct- to- Consumer (DTC) Advertisements Page 28 GAO- 03- 177 Presciption
Drug Advertising Survey Sample Survey date
Aware of advertisement, percentage
Talked with physician percentage a
Specific prescription requested,
percentage b Prescription received,
percentage of those who made a specific request
Prescription received, percentage of total sample c FDA d N= 943, national
random sample of consumers who had visited a doctor in the last 3 months
2002 81 23 7 69 5 FDA e N= 1,081, national
random sample, 960 of whom had visited a doctor in the last 3 months
1999 72 32 13 50 2
Prevention Magazine f N= 1,601 national
random sample, age 18 or older, oversampled 1, 000
males 2001 85 32 29 77 7
Prevention Magazine g N= 1,222 national
random sample, age 18 or older 2000 80 32 26 71 5
Prevention Magazine h N= 1,200 national
random sample, age 18 or older 1999 81 31 28 84 7
Prevention Magazine i N= 1,200 national
random sample, age 18 or older 1998 70 33 28 80 6
Prevention Magazine j N= 1,202 national
random sample, age 18 or older 1997 63 31 29 73 4 Weissman et al. k N=
3,000 national
random sample, adults
2001- 2002 86 35 27 21 5 Kaiser Family Foundation l N= 2,511 national
random sample, 872 DTC advertisement viewers compared to 639 DTC
advertisement nonviewers 2001 N/ A m 30 N/ A 44 6
National Consumers League n N= 1,013 national
random sample, age 18 or older 1998 80 44 N/ A 22 5 AARP o N= 1,310
national,
oversampled 50 or older (print only)
1998 65 N/ A N/ A N/ A N/ A
Appendix II: Surveys of Consumers* Behavior after Seeing or Hearing
Direct- to- Consumer (DTC) Advertisements
Appendix II: Surveys of Consumers* Behavior after Seeing or Hearing
Direct- to- Consumer (DTC) Advertisements Page 29 GAO- 03- 177 Presciption
Drug Advertising Survey Sample Survey date
Aware of advertisement, percentage
Talked with physician percentage a
Specific prescription requested,
percentage b Prescription received,
percentage of those who made a specific request
Prescription received, percentage of total sample c Bell et al. p N= 329
random sample of
Sacramento residents
1998 3.7 of 10 drug advertisements q 35 19 N/ A N/ A Mintzes et al. r N=
38 physician and
748 patients in Sacramento age 18 or older
2001 72 N/ A 7 78 6 a In the FDA surveys consumers were asked, *Did you
ask whether there might be a prescription drug to treat your condition?*
This question was not asked of consumers who thought that their doctor
would keep them on their current drug in FDA*s 1999 survey. The Prevention
Magazine surveys asked *Did you speak with your doctor about an advertised
prescription medicine?* The percentage reported is based on consumers who
had seen an advertised prescription medication and subsequently spoke with
their doctor about it. b In the 1999 FDA survey, this question was not
asked of consumers who thought that their doctor
would keep them on their current drug. In the Prevention Magazine Surveys,
this question was asked only of consumers who spoke with their doctors
about an advertised medicine. c Percentages are calculated by dividing the
number of consumers who received the prescription requested by the total
sample. For FDA*s 1999 survey, this information was provided to us because
the information was unavailable in its on- line survey. d Kathryn J.
Aikin, Direct- to- Consumer Advertising of Prescription Drugs: Preliminary
Patient Survey Results (Rockville, Md.: FDA, Division of Drug Marketing,
Advertising and Communications, April
2002). e FDA, Office of Medical Policy, Division of Drug Marketing,
Advertising and Communications,
*Attitudes and Behaviors Associated with Direct- to- Consumer (DTC)
Promotion of Prescription Drugs: Main Survey Results* (Rockville, Md.:
FDA, Division of Drug Marketing, Advertising and Communications, 1999),
http:// www. fda. gov/ cder/ ddmac/ dtcindex. htm (downloaded March 11,
2002). f Ed Slaughter, 5th Annual Survey: Consumer Reaction to DTC
Advertising of Prescription Medicines,
2001- 2002 (Emmaus, Pa.: Rodale, Inc., 2002). Technical assistance in
developing the survey was provided by FDA and Princeton Survey Research
Associates. g Ed Slaughter and Martha Schumacher, Prevention*s
International Survey on Wellness and
Consumer Reaction to DTC Advertising of Rx Drugs, 2000- 2001 (Emmaus, Pa.:
Rodale, Inc., 2001). Technical assistance in developing the survey was
provided by FDA. h Prevention Magazine, Year Two: A National Survey of
Consumer Reactions to Direct- to- Consumer Advertising, 1999 (Emmaus, Pa.:
Rodale, Inc., 1999). Technical assistance in developing the survey was
provided by FDA. i Prevention Magazine, National Survey of Consumer
Reactions to Direct- to- Consumer Advertising,
1998 (Emmaus, Pa.: Rodale Press, 1998). Technical assistance in developing
the survey was provided by FDA. j Prevention Magazine, Navigating the
Medication Marketplace: How Consumers Choose, 1997
(Emmaus, Pa.: Rodale Press and APhA, 1997). Technical assistance in
developing the survey was provided by the American Pharmaceutical
Association.
Appendix II: Surveys of Consumers* Behavior after Seeing or Hearing
Direct- to- Consumer (DTC) Advertisements Page 30 GAO- 03- 177 Presciption
Drug Advertising k Joel S. Weissman, David Blumenthal, Alvin Silk, Kinga
Zapert, Michael Newman, and Robert
Leitman, *Consumer Reports on the Health Effects of Direct- to- Consumer
Advertising (DTCA) of Prescription Drugs* (paper presented at the annual
meeting of the Association for Health Services Research, Washington, D.
C., June 2002). l Henry J. Kaiser Family Foundation, Understanding the
Effects of Direct- to- Consumer Prescription
Drug Advertising (Menlo Park, Calif.: Henry J. Kaiser Family Foundation,
2001). m N/ A means that consumers were not asked this question.
n National Consumers League, *Health Care Information and the Consumer: A
Public Opinion Survey* (Washington, D. C.: National Consumers League,
1998). o Lisa Foley and David Gross, Are Consumers Well Informed About
Prescription Drugs? The Impact of
Printed Direct- to- Consumer Advertising (Washington, D. C.: AARP, 2000).
p Robert A. Bell, Richard L. Kravitz, and Michael S. Wilkes, *Direct- to-
Consumer Prescription Drug
Advertising and the Public,* Journal of General Internal Medicine, vol. 14
(1999). q Consumers were asked whether they had seen an advertisement for
each of 10 drugs that were
being advertised at the time of the survey. An Ad Awareness Index was
created by summing for each respondent the number of drugs for which she
or he reported having seen an advertisement. On average, consumers were
aware of 3.7 of the 10 drugs. r Barbara Mintzes, Morris Barer, Richard
Kravitz, Arminee Kazanjian, Ken Bassett, Joel Lexchin, Bob
Evans, Richard Pan, and Steve Marion, *Patient Requests for Prescriptions
in Environments with and without Legal Direct- to- Consumer Advertising*
(paper presented at the annual meeting of the Association for Health
Services Research, Washington, D. C., June 2002).
Appendix III: Comments from the Department of Health and Human Services
Page 31 GAO- 03- 177 Presciption Drug Advertising Appendix III: Comments
from the Department of Health and Human Services
Appendix III: Comments from the Department of Health and Human Services
Page 32 GAO- 03- 177 Presciption Drug Advertising
Appendix III: Comments from the Department of Health and Human Services
Page 33 GAO- 03- 177 Presciption Drug Advertising (290168)
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