Pharmaceutical Drug Advertising As It Relates to Pharmacy Benefit Spend

PBIRx®

Intelligent Solutions in Pharmacy Benefits

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Did you know that in 2014, the health care industry spent a whopping $14 billion on advertising? That’s a jump of nearly 20% since 2011, and it would not be out of line to wonder if advertising spend is going to increase moving forward. In fact, in the first nine months of 2015, $2.4 billion was spent on United States TV ads for prescription drugs alone.

To date, the United States and New Zealand are the only two countries that permit consumer advertising for drugs. And although drug manufacturers of brand drugs might see this as a good opportunity to promote their products, others disagree, saying that advertising drugs and medical treatments could have a negative effect on our health care system, and most notably, the cost of services.

According to an article from The New York Times, many of the latest drug advertisements are pointing patients in the direction of some of the most expensive new drug treatments new to the market. A specific example, given on a recent episode of 60 Minutes, referred to four costly brand drugs that were promoted even though there are generic drugs available that cost much less. But since these TV ads are promoting the expensive treatments as opposed to those that are more cost-effective, it is only natural for patients/viewers to bring them to the attention of their doctor. 

Another example comes from the January 31, 2016 broadcast of Grease Live on Fox. During the show, a commercial for Opdivo, a treatment that costs over $12,000 per month, was shown to viewers. Additionally, the Opdivo advertisement was also run regularly during the NFL season. As a result, The Wall Street Journal explains that this could encourage patients to “pressure their health-insurance plans to cover the drugs,” and the result of such could mean increased costs for providers.

In addition to contributing to rising health care costs, a major problem with many of today’s drug advertisements is that viewers are not provided with information on risks and side effects as compared to the drug benefits. For those commercials that do specify the treatment, risks are usually listed very quickly at the end, not giving the viewer enough time to process them. On the other hand, some advertisers have even steered towards not stating the drug, but focusing on the disease state so that mention of side effects is not necessary. While drug manufacturers may be acting in accordance with advertising regulations, the way information is presented may not be the most beneficial for patients as there is zero focus on patient risk and plan sponsor cost.

For more information about recent pharmaceutical drug advertising and the serious effects it could have on our health care system and all those involved, be sure to check out the articles from The New York Times and The Wall Street Journal, linked above.

Having no preferred relationships with any PBM, PBIRx benefits clients by utilizing cutting edge technology and an experienced staff totally focused on the pharmacy benefit. PBIRx strives to help entities get more control over their health care costs. We realize how the changing nature of drug advertisements could increase the pharmacy benefit spend for our clients. That is why PBIRx has developed proprietary clinical algorithms based on new drug information reviewed on a continuum to proactively advise clients of new recommendations weekly and monthly, whereas the PBM “maybe” provides information quarterly as the PBMs and Manufacturers partner together to profit from rebates.  

To learn how YOU can benefit from our pharmacy benefit consulting and auditing services, please give us a call at (888) 797-2479 today.