Prescription Drugs
FDA Oversight of Direct-to-Consumer Advertising Has Limitations
Gao ID: GAO-03-177 October 28, 2002
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.
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GAO-03-177, Prescription Drugs: FDA Oversight of Direct-to-Consumer Advertising Has Limitations
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Report to Congressional Requesters:
United States General Accounting Office:
GAO:
October 2002:
Prescription Drugs:
FDA Oversight of Direct-to-Consumer Advertising Has Limitations:
Presciption Drug Advertising:
GAO-03-177:
Contents:
Letter:
Results in Brief:
Background:
Pharmaceutical Companies Spend More on Research and Development than on
DTC Advertising:
DTC Advertising Appears to Increase Prescription Drug Spending and
Utilization:
FDA‘s Oversight of DTC Advertising Has Limitations:
Conclusions:
Recommendation for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Scope and Methodology:
Appendix II: Surveys of Consumers‘ Behavior after Seeing or
Hearing Direct-to-Consumer (DTC) Advertisements:
Appendix III: Comments from the Department of Health and
Human Services:
Tables:
Table 1: Selected Requirements for Contents of Print and Broadcast
Product Claim Advertisements:
Table 2: DTC Advertising Spending Compared to Spending on Total
Promotion and Research and Development from 1997 to 2001:
Table 3: The 15 Drugs with the Highest DTC Spending, 2000:
Table 4: DTC Regulatory Letters Sent by FDA in 2001:
Table 5: Calendar Days between DDMAC‘s Draft Regulatory Letter
Submission to OCC and Issuance Date, since January 31, 2002:
Table 6: Duration of DTC Television Advertisements:
Figures:
Figure 1: Spending on Pharmaceutical Promotional Activities, 2001:
Figure 2: Percentage of Sales for Chronic and Acute Conditions Treated
by the 50 Drugs with the Highest Spending on DTC Advertising, 2000:
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:
United States General Accounting Office:
Washington, DC 20548:
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.[Footnote 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.
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).[Footnote 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.[Footnote 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).[Footnote 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.[Footnote 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 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.[Footnote 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.
Results in Brief:
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, 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 regulatory letters quickly and said that it
intends to reduce the number of days that the letters are under review.
Background:
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.
Reasons for Increased Prescription Drug Spending and Utilization:
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.[Footnote 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.[Footnote 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 1992, reaching nearly 3 billion in 2000.[Footnote 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.[Footnote 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.[Footnote 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.[Footnote 12]
FDA‘s Requirements for the Content of DTC Advertisements:
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. 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: Print and broadcast; Regulatory requirements:
Cannot be false or misleading; Explanation: Must present information
that is not inconsistent with product label.
Regulatory requirements: Must present fair balance; Explanation: Must
include risks and benefits of a drug product.
Regulatory requirements: Must present ’facts material“; Explanation:
Must present information relevant to representations made, and describe
consequences that may result from recommended use.
Advertising medium: Print only; Regulatory requirements: Must describe
risks; Explanation: Must disclose all risks in a product‘s labeling.
Advertising medium: Broadcast only; Regulatory requirements: Must
describe risks; Explanation: Must present major side effects and
contraindications[A] in audio or audio and visual form.
Regulatory requirements: Must make ’adequate provision“ for directing
consumers to labeling information, or provide a brief summary of all
necessary information related to risks; Explanation: 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. § 202; FDA, Guidance for Industry: Consumer-directed
Broadcast Advertisements (Washington, D.C.: FDA, Aug. 1997).
[End of table]
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
information to consumers, and thereby meet the adequate provision
portion of its regulations.[Footnote 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.
FDA Regulatory Letters:
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 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:
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.
Despite Rapid Growth in Spending on DTC Advertising, Pharmaceutical
Companies Spend More on Research and Development:
According to industry analyses, spending on research and development
was more than 10 times higher than spending on DTC advertising in
2001.[Footnote 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.
Table 2: DTC Advertising Spending Compared to Spending on Total
Promotion and Research and Development from 1997 to 2001:
Dollars in billions:
DTC; 1997: $1.1; 1998: $1.3; 1999: $1.8; 2000:
$2.5; 2001: $2.7; Percentage spending increase, 1997-2001: 145.
Total promotion[A]; 1997: 11.0; 1998: 12.5; 1999:
13.9; 2000: 15.7; 2001: 19.1; Percentage spending increase, 1997-2001:
74.
Research and development; 1997: 19.0; 1998: 21.1;
1999: 22.7; 2000: 26.0; 2001: 30.3[B]; Percentage spending increase,
1997-2001: 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.“
[End of table]
In recent years there has been a shift of DTC advertising from print
media to television broadcasts.[Footnote 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 Directed to Physicians:
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.[Footnote 16] (See fig. 1.) The ratio of total promotional
spending to drug sales remained fairly 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:
[See PDF for image]
[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.“
[End of figure]
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. 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.
Many DTC-Advertised Drugs Are Best Sellers:
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.[Footnote 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.
DTC-Advertised Drugs Are for Chronic Conditions and Are Often Promoted
to Physicians:
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.
Figure 2: Percentage of Sales for Chronic and Acute Conditions Treated
by the 50 Drugs with the Highest Spending on DTC Advertising, 2000:
[See PDF for figure]
Source: GAO analysis of data from NIHCM Foundation, Prescription Drugs
and Mass Media Advertising, 2000.
[End of figure]
Table 3: The 15 Drugs with the Highest DTC Spending, 2000:
Drug: Vioxx; Condition: Arthritis; Percentage of DTC spending for all
drugs[A]: 7.1; Percentage of sales for all drugs[B]: 1.2.
Drug: Prilosec; Condition: Acid reflux; Percentage of DTC spending for
all drugs[A]: 4.8; Percentage of sales for all drugs[B]: 3.1.
Drug: Claritin; Condition: Allergy; Percentage of DTC spending for all
drugs[A]: 4.4; Percentage of sales for all drugs[B]: 1.5.
Drug: Paxil; Condition: Depression; Percentage of DTC spending for all
drugs[A]: 4.1; Percentage of sales for all drugs[B]: 1.4.
Drug: Zocor; Condition: High cholesterol; Percentage of DTC spending
for all drugs[A]: 4.0; Percentage of sales for all drugs[B]: 1.7.
Drug: Viagra; Condition: Impotence; Percentage of DTC spending for all
drugs[A]: 4.0; Percentage of sales for all drugs[B]: 0.6.
Drug: Celebrex; Condition: Arthritis; Percentage of DTC spending for
all drugs[A]: 3.5; Percentage of sales for all drugs[B]: 1.5.
Drug: Flonase; Condition: Allergy; Percentage of DTC spending for all
drugs[A]: 3.3; Percentage of sales for all drugs[B]: 0.5.
Drug: Allegra; Condition: Allergy; Percentage of DTC spending for all
drugs[A]: 3.0; Percentage of sales for all drugs[B]: 0.8.
Drug: Meridia; Condition: Obesity; Percentage of DTC spending for all
drugs[A]: 2.9; Percentage of sales for all drugs[B]: 0.1.
Drug: Flovent; Condition: Asthma; Percentage of DTC spending for all
drugs[A]: 2.8; Percentage of sales for all drugs[B]: 0.5.
Drug: Pravachol; Condition: High cholesterol; Percentage of DTC
spending for all drugs[A]: 2.7; Percentage of sales for all drugs[B]:
0.9.
Drug: Zyrtec; Condition: Allergy; Percentage of DTC spending for all
drugs[A]: 2.7; Percentage of sales for all drugs[B]: 0.6.
Drug: Singulair; Condition: Asthma; Percentage of DTC
spending for all drugs[A]: 2.6; Percentage of sales for all drugs[B]:
0.5.
Drug: Lipitor; Condition: High cholesterol; Percentage of DTC
spending for all drugs[A]: 2.6; Percentage of sales for all drugs[B]:
2.8.
Total; Percentage of DTC spending
for all drugs[A]: 54.5; Percentage of sales for all drugs[B]: 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.
[End of table]
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.[Footnote 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.[Footnote 19] In addition, there is a growing trend to
announce through DTC venues such as television, newspaper
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.
Research Studies Suggest That DTC Advertising Has Increased Utilization
and Sales of Advertised Drugs:
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.[Footnote 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.[Footnote 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).[Footnote 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.[Footnote 23]
An exception to this pattern of findings is a study on the effects of
fluctuations in the intensity of DTC advertising on sales of
cholesterol-lowering 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 cholesterol-lowering drugs as a class.[Footnote 24]
Unlike the studies described above, this research did not consider the
effects of promotion to physicians.
Consumer Surveys Have Found That DTC Advertisements Influence Consumers
to Ask Physicians for Brand-name Drugs:
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.[Footnote 25]
FDA‘s Oversight of DTC Advertising Has Limitations:
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.
DDMAC Targets Reviews:
As of June 2002, five DDMAC staff were dedicated to reviewing DTC
advertisements, and two DTC review slots were vacant.[Footnote 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.[Footnote 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 2001. In addition to monitoring and review
activities, DDMAC conducts research to better understand consumer and
physician behavior related to DTC advertising.
FDA Sends Regulatory Letters When It Identifies a Violation:
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.[Footnote 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
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 one-tenth 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.
Table 4: DTC Regulatory Letters Sent by FDA in 2001:
Drug: Prilosec; Condition: Acid reflux; Company: AstraZeneca; Date: 1/
3/01; Type of letter: Untitled; Violation: Provides inadequate
information on approved product indication and use, lacks fair balance.
Drug: Protopic; Condition: Eczema; Company: Fujisawa Healthcare; Date:
2/16/01; Type of letter: Untitled; Violation: Fails to provide
necessary information for making product claims.
Drug: Xenical; Condition: Obesity; Company: Hoffmann-La Roche; Date: 3/
30/01; Type of letter: Untitled; Violation: Provides
inadequate information on full indication, fails to fulfill ’adequate
provision“[A] requirements, lacks fair balance.
Drug: Plavix; Condition: Heart disease; Company: Sanofi-Synthelabo;
Date: 6/8/01; Type of letter: Untitled; Violation: Minimizes
role of physician, fails to fulfill ’adequate provision“ requirements.
Drug: Avandia; Condition: Diabetes; Company: GlaxoSmithKline; Date: 6/
28/01; Type of letter: Untitled; Violation: Minimizes risks.
Drug: Ditropan XL; Condition: Overactive bladder; Company: Alza; Date:
7/12/01; Type of letter: Untitled; Violation: Overstates
efficacy, minimizes risks, fails to convey indications.
Drug: Cerezyme; Condition: Gaucher disease; Company: Genzyme; Date: 7/
13/01; Type of letter: Untitled; Violation: Minimizes risks,
fails to fulfill ’adequate provision“ requirements, fails to disclose
prescription drug status.
Drug: Niaspan; Condition: High cholesterol; Company: Kos
Pharmaceuticals; Date: 7/13/01; Type of letter: Warning;
Violation: Fails to present significant risks; makes misleading
efficacy claims; implied use is inconsistent with product labeling.
Drug: Luxiq; Condition: Psoriasis and eczema; Company: Connetics; Date:
8/13/01; Type of letter: Untitled; Violation: Overstates
efficacy, misleading preference, compliance, and superiority claims.
Drug: Differin; Condition: Acne; Company: Galderma Laboratories; Date:
10/1/01; Type of letter: Untitled; Violation: Provides
inadequate risk information in relation to effectiveness information.
Drug: Actonel; Condition: Osteoporosis; Company: Proctor & Gamble;
Date: 10/9/01; Type of letter: Untitled; Violation: Minimizes
role of health care provider, fails to fulfill ’adequate provision“
requirements, provides inadequate risk information.
Drug: Protopic; Condition: Eczema; Company: Fujisawa Healthcare; Date:
11/14/01; Type of letter: Untitled; Violation: Overstates
efficacy, broadens approved product indication, minimizes risk.
Drug: Nolvadex; Condition: Breast cancer; Company: AstraZeneca; Date:
12/14/01; Type of letter: Untitled; Violation: 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).
[End of table]
FDA‘s Regulatory Letters Are Effective in Halting Dissemination of
Misleading Advertisements:
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.
Some Pharmaceutical Companies Have Been Cited for Repeatedly
Disseminating Different Misleading Advertisements:
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.[Footnote 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.
Effectiveness of FDA‘s Oversight of DTC Advertising Is Limited in Two
Ways:
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 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.[Footnote
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.[Footnote 31]
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 one-third 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: 3/22/02; Date issued: 5/16/02; Calendar
days between submission by DDMAC and issuance: 55.
Date submitted to OCC by DDMAC: 4/4/02; Date issued: 5/13/02; Calendar
days between submission by DDMAC and issuance: 39.
Date submitted to OCC by DDMAC: 4/8/02; Date issued: 4/30/02; Calendar
days between submission by DDMAC and issuance: 22.
Date submitted to OCC by DDMAC: 5/16/02; Date issued: 8/2/02; Calendar
days between submission by DDMAC and issuance: 78.
Date submitted to OCC by DDMAC: 7/30/02; Date issued: 8/12/02; Calendar
days between submission by DDMAC and issuance: 13.
Source: GAO analysis of data provided by FDA.
[End of table]
Table 6: Duration of DTC Television Advertisements:
Months on the air: 1; Percentage: 22.
Months on the air: 2; Percentage: 10.
Months on the air: 3-6; Percentage: 30.
Months on the air: 7-12; Percentage: 29.
Months on the air: 13-28; Percentage: 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.
[End of table]
Conclusions:
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.
Recommendation for Executive Action:
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.
Agency Comments and Our Evaluation:
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.
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:
Signed by Janet Heinrich
[End of section]
Appendix I: Scope and Methodology:
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 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.
[End of section]
Appendix II Surveys of Consumers‘ Behavior after Seeing or Hearing
Direct-to-Consumer (DTC) Advertisements:
Survey: FDA[D]; Sample: N=943, national random sample of consumers who
had visited a doctor in the last 3 months; Survey date: 2002; Aware of
advertisement, percentage: 81; Talked with physician percentage[A]: 23;
Specific prescription requested, percentage[B]: 7; Prescription
received, percentage of those who made a specific request: 69;
Prescription received, percentage of total sample[C]: 5.
Survey: FDA[E]; Sample: N=1,081, national random sample, 960 of whom
had visited a doctor in the last 3 months; Survey date: 1999; Aware of
advertisement, percentage: 72; Talked with physician percentage[A]: 32;
Specific prescription requested, percentage[B]: 13; Prescription
received, percentage of those who made a specific request: 50;
Prescription received, percentage of total sample[C]: 2.
Survey: Prevention Magazine[F]; Sample: N=1,601 national random sample,
age 18 or older, oversampled 1,000 males; Survey date: 2001; Aware of
advertisement, percentage: 85; Talked with physician percentage[A]: 32;
Specific prescription requested, percentage[B]: 29; Prescription
received, percentage of those who made a specific request: 77;
Prescription received, percentage of total sample[C]: 7.
Survey: Prevention Magazine[G]; Sample: N=1,222 national random sample,
age 18 or older; Survey date: 2000; Aware of advertisement, percentage:
80; Talked with physician percentage[A]: 32; Specific prescription
requested, percentage[B]: 26; Prescription received, percentage of
those who made a specific request: 71; Prescription received,
percentage of total sample[C]: 5.
Survey: Prevention Magazine[H]; Sample: N=1,200 national random sample,
age 18 or older; Survey date: 1999; Aware of advertisement, percentage:
81; Talked with physician percentage[A]: 31; Specific prescription
requested, percentage[B]: 28; Prescription received, percentage of
those who made a specific request: 84; Prescription received,
percentage of total sample[C]: 7.
Survey: Prevention Magazine[I]; Sample: N=1,200 national random sample,
age 18 or older; Survey date: 1998; Aware of advertisement, percentage:
70; Talked with physician percentage[A]: 33; Specific prescription
requested, percentage[B]: 28; Prescription received, percentage of
those who made a specific request: 80; Prescription received,
percentage of total sample[C]: 6.
Survey: Prevention Magazine[J]; Sample: N=1,202 national random sample,
age 18 or older; Survey date: 1997; Aware of advertisement, percentage:
63; Talked with physician percentage[A]: 31; Specific prescription
requested, percentage[B]: 29; Prescription received, percentage of
those who made a specific request: 73; Prescription received,
percentage of total sample[C]: 4.
Survey: Weissman et al.[K]; Sample: N=3,000 national random sample,
adults; Survey date: 2001-2002; Aware of advertisement, percentage: 86;
Talked with physician percentage[A]: 35; Specific prescription
requested, percentage[B]: 27; Prescription received, percentage of
those who made a specific request: 21; Prescription received,
percentage of total sample[C]: 5.
Survey: Kaiser Family Foundation[L]; Sample: N=2,511 national random
sample, 872 DTC advertisement viewers compared to 639 DTC advertisement
non-viewers; Survey date: 2001; Aware of advertisement, percentage: N/
A[M]; Talked with physician percentage[A]: 30; Specific prescription
requested, percentage[B]: N/A; Prescription received, percentage of
those who made a specific request: 44; Prescription received,
percentage of total sample[C]: 6.
Survey: National Consumers League[N]; Sample: N=1,013 national random
sample, age 18 or older; Survey date: 1998; Aware of advertisement,
percentage: 80; Talked with physician percentage[A]: 44; Specific
prescription requested, percentage[B]: N/A; Prescription received,
percentage of those who made a specific request: 22; Prescription
received, percentage of total sample[C]: 5.
Survey: AARP[O]; Sample: N=1,310 national, oversampled 50 or older
(print only); Survey date: 1998; Aware of advertisement, percentage:
65; Talked with physician percentage[A]: N/A; Specific prescription
requested, percentage[B]: N/A; Prescription received, percentage of
those who made a specific request: N/A; Prescription received,
percentage of total sample[C]: N/A.
Survey: Bell et al.[P]; Sample: N=329 random sample of Sacramento
residents; Survey date: 1998; Aware of advertisement, percentage: 3.7
of 10 drug advertisements[Q]; Talked with physician percentage[A]: 35;
Specific prescription requested, percentage[B]: 19; Prescription
received, percentage of those who made a specific request: N/A;
Prescription received, percentage of total sample[C]: N/A.
Survey: Mintzes et al.[R]; Sample: N=38 physician and 748 patients in
Sacramento age 18 or older; Survey date: 2001; Aware of advertisement,
percentage: 72; Talked with physician percentage[A]: N/A; Specific
prescription requested, percentage[B]: 7; Prescription received,
percentage of those who made a specific request: 78; Prescription
received, percentage of total sample[C]: 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.
[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).
[End of table]
[End of section]
Appendix III: Comments from the Department of Health and Human
Services:
OCT 11 2002:
Ms. Janet Heinrich:
Director, Health Care - Public Health Issues, United States General:
Accounting Office Washington, D.C. 20548:
Dear Ms. Heinrich:
Enclosed are the department‘s comments on your draft report entitled,
’Prescription Drugs: FDA Oversight of Direct-to-Consumer Advertising
Has Limitations.“ The comments represent the tentative position of the
department and are subject to reevaluation when the final version of
this report is received.
The department also provided several technical comments directly to
your staff.
The department appreciates the opportunity to comment on this draft
report before its publication.
Sincerely,
Janet Rehnquist, Inspector General
Signed by an official for Janet Rehnquist
Enclosure:
The Office of Inspector General (OIG) is transmitting the department‘s
response to this draft report in our capacity as the department‘s
designated focal point and coordinator for General Accounting Office
reports. The OIG has not conducted an independent assessment of these
comments and therefore expresses no opinion on them.
Comments of the Department of Health and Human Services on the General
Accounting Office‘s Draft Report, ’Prescription Drugs: FDA Oversight of
Direct-To-Consumer Advertising Has Limitations“ (GAO-03-177):
The Department of Health and Human Services (the department)
appreciates the opportunity to review and comment on this draft report.
While we take issue with some of the report‘s conclusions about the
impacts of direct-to-consumer (DTC) advertising, the department
generally agrees with the report‘s informative summary of issues with
respect to the Food and Drug Administration‘s (FDA) oversight of DTC
advertising. We are especially pleased with GAO‘s conclusion that FDA
oversight is ’...generally effective at halting the dissemination of
advertisements it reviews and identifies as misleading.“:
General Comments:
The report discusses the department‘s policy change requiring FDA‘s
Office of the Chief Counsel (OCC) to review all draft warning and
untitled letters. The purpose of the policy that OCC review all
enforcement correspondence, including Division of Drug Marketing,
Advertising, and Communications (DDMAC) letters, is to ensure that such
letters rest on a solid legal foundation, are credible, and will
promote compliance. Before this policy was instituted, there had been
complaints that FDA would not follow up on many of its letters. Indeed,
some FDA Centers sent several advertising/promotion enforcement letters
to companies that had ignored FDA‘s first warning.
The policy‘s goal is for those who receive enforcement correspondence
from the agency to understand that it has undergone legal review, and
that the agency is prepared to back it up by going to court if
necessary. Before this policy went into effect, certain letters were
sent out without considering their legal sufficiency because it was
believed the issue would never get to court. If this approach became
apparent to the public, the credibility of the agency would suffer as
companies test whether the agency truly intends to stand behind a
particular letter.
The FDA cannot afford to be considered a paper tiger. When FDA takes a
position, companies must believe that FDA can and will back it up by
going to court if necessary. The FDA cannot sue the thousands of firms
it regulates into compliance; it must take positions that promote
voluntary compliance. Therefore a change was found to be necessary and
desirable.
While this policy change has, as GAO indicated, increased the number of
days between DDMAC‘s identification of a misleading advertisement and
FDA‘s request to remove it from dissemination, the process is new and
the agency anticipates that the number of days required for review of
draft warning and untitled letters will decrease.
The OCC has concurred with pursuing all DTC regulatory letters
submitted by DDMAC. The OCC review has strengthened the quality and
legal sustainability of the letters making it much more likely that
companies take them seriously and quickly react to problems identified
in the letter. Nevertheless, the department recognizes that despite the
important value added by OCC, we need to issue DTC enforcement
correspondence more quickly. To that end, we have established a goal of
issuing these letters within 15 working days of review at OCC.
[End of section]
FOOTNOTES
[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.
[2] 21 U.S.C. § 502(n).
[3] 21 C.F.R. § 202.1(e).
[4] 21 C.F.R. § 314.81(b)(3)(i).
[5] The guidance was finalized in 1999.
[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.
[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).
[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. 01-3670
(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.
[13] FDA, Guidance for Industry: Consumer-directed Broadcast
Advertisements (Washington, D.C.: FDA, Aug. 1997).
[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.
[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)).
[17] NIHCM Foundation, Prescription Drugs and Mass Media Advertising,
2000.
[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).
[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.
[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.
[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.
[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.
[29] Company names listed here are based on the names as of the date of
the last regulatory letter that they received.
[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.
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