US Congressional Budget Office Issues A Brief Over Ban On Direct To Consumer Advertising Of New Drugs

A report from the US Congressional Budget Office (CBO) examining the potential impact of a two-year ban on direct-to-consumer (DTC) advertising for new drugs "Potential Effects of a Ban on Direct-to Consumer Advertising of New Prescription Drugs", found the proposed ban would likely have little impact on prices. The drug manufacturers will switch to advertising to doctors to gain from the loss of DTC advertising.
Following is the summery of the CBO article and follow the link below for the complete article.


Direct-to-consumer (DTC) advertising of prescription drugs has elicited various concerns. One concern is that DTC advertising may add to spending on drugs by consumers, insurers, and the federal government without providing enough benefits to justify that spending; specifically, some observers worry that DTC advertising encourages broader use of certain drugs than their health benefits warrant. Another concern is that DTC advertising for newly approved drugs may lead people to use drugs whose potential risks were not fully discovered during the drug approval process. Those concerns have spurred recent proposals for a moratorium on advertising brand-name prescription drugs to consumers during the first two years following a drug’s approval by the Food and Drug Administration (FDA). Although such a moratorium would allow more time for safety concerns about a new drug to be revealed, it would entail health risks of its own, because some individuals who would benefit from a new drug might be unaware of its availability in the absence of consumer advertising.
A moratorium on direct-to-consumer advertising might affect other marketing strategies used by drug manufacturers and the quantities and prices of drugs sold. To highlight some of those effects, this Congressional Budget Office (CBO) issue brief draws on data
documenting DTC advertising and other promotional activities used by pharmaceutical producers as well as academic analyses of how advertising has affected the market for drugs. The expected effects of a moratorium include the following:

* Drug manufacturers would probably expand their marketing to physicians to substitute for at least some of the banned advertising to consumers.
* The number of prescriptions filled would probably decrease for some drugs. For other drugs, the number of prescriptions might be little changed, owing both to the likely substitution of other types of promotions
and to the various other factors that influence a drug’s reach in the prescription drug market.
* Any change in prescription drug prices would depend on changes in demand; to the extent that the effects on demand are likely to be limited, so too are the effects on prices.

In addition, a moratorium could affect public health. That impact is uncertain, depending on whether the benefits of fewer unexpected adverse health events were larger than the health costs of possibly reduced use of new and effective drugs.

Congressional Budget Office
You can also read FDA's take on the brief at FDA Lawyers Blog