Plavix advertising indirectly cost taxpayers an extra $207 million over five years*

Advertising brand-name prescription medications directly to patients is a uniquely American custom, and a controversial one at that. A study published today in the Archives of Internal Medicine may stir new debate over the practice. In the case of one blockbuster drug, the study found, a major advertising campaign did little to expand the medication's use but brought price hikes that cost taxpayers hundreds of millions over a seven-year period.

Both critics and defenders of direct-to-consumer drug advertising agree on one thing: that the advertising of prescription medications will run up the bill that taxpayers foot to provide healthcare insurance to the elderly, disabled and poor through Medicare and Medicaid. When patients see commercials for a branded drug, they will ask for these medications in greater numbers, and they will get them, the reasoning goes.

But whether that higher price tag buys better healthcare is the point of dispute. Critics charge that advertising allows drug companies to pump up their sales to Medicare and Medicaid patients who might otherwise be treated with safer, cheaper medications. Defenders of the practice argue that drug ads spur more patients to seek treatment for conditions (such as high blood pressure or depression) that are widely under-diagnosed: Sure, it'll cost the taxpayer more, they say, but that's because more Medicare and Medicaid patients will get the treatment they need because they saw an ad.

But what if neither side is right? What if advertising a drug did not spur a rise in a drug's use, just in its price?

That, effectively, is what a pair of Canadians who teamed up with researchers from Harvard University and Kaiser Permanente found when they looked at the cost and use of the drug Plavix,* used to prevent blood clots, from 1999 to 2005. Plavix was on the market for two years, and its use was growing steadily when Bristol-Myers Squibb launched a major advertising campaign for the drug in 2001. Over the next five years, the drug company spent $350 million to promote Plavix in advertisements aimed at consumers.

But according to Michael Law of the University of British Columbia, the advertising campaign did not accelerate the growth in sales of Plavix, which reached $5.9 billion in 2005. While they continued to grow, Plavix sales grew no faster after advertising began than they had before the ads hit the airwaves.

But the cost of the drug certainly accelerated, Law found. Looking at Medicaid expenses in 27 states, Law and his co-authors found that the cost of Plavix shot up from $3.40 per prescription just before advertising began. "Immediately after [advertising] initiation, we found a large, sudden, and statistically significant increase" of 12% in the cost of a Plavix prescription. By the end of 2005, the cost to taxpayers a Plavix prescription filled by a Medicaid patient rose 25% beyond the more modest rate of inflation that would have been expected before advertising began.

Translation: In the Medicaid program alone, just 27 states spent a collective $207 million more on Plavix prescriptions after the big advertising campaign began than would have been expected. If one were to figure in the added cost to Medicare programs and the Medicaid programs of the remaining 23 states, the added cost would look like real money indeed.

Lawmakers in recent years have wrangled over whether and how to rein in drug advertising directed at patients rather than physicians, with no changes made to date. The authors say it's not time to put the debate aside. "Payers and policymakers should appropriately still be concerned about [direct-to-consumer advertising] increasing total drug costs for publicly funded reimbursement programs such as Medicare and Medicaid," they wrote.

--Melissa Healy

* An earlier version of this post incorrectly said that Plavis is a cholesterol drug.

Comments

[Tom Necela]

Interesting article, but someone please remind me - why are we paying for this? Last time I checked, most pharmaceutical companies were raking in billions in profits. Meanwhile, Medicare is trying to save money by cutting fees for physicians, chiropractors, radiologists and virtually every other specialty. And I am sure that Plavix wasn't the only drug that had this affect on the system.

[RabidinL.A.]

The omnipotent pharmaceutical companies lamentably, run our nation and are the major factor as to why passage of healthcare is dragging on. They enjoy a comfy no holds barred position to do whatever they please, much like fascist dictators.
All prescription drug advertising must be banned. I've already written to my federal representatives regarding this, pointing out that aside from the annoyance of being bombarded 24/7 with ads about drugs only doctors can prescribe and understand, this constant and incessant barrage and parade of ads is forming a generation of hypochondriacs who are wondering if they have this or that disease or ailment, running to the doctor over nothing most of the time. Prescription drug overdoses and deaths are out of control, have never been higher, and our children are now scouring our medicine cabinets for any drugs that might get them high. They want everyone addicted, whether physically or psychologically. Now they want the lame and pander-ridden FDA to lax up on rules for advertising so they can continue their persistent barrage of our minds, psyches, and lives on the internet! There will be no escape. Drug advertising HAS TO STOP. It is illegal in Canada, and, as stated in this informative article, is uniquely an American "custom". In actuality, it is no custom, but a huge abuse. If you like abuse, do nothing and the next generation will all be brain-dead zombies behind the driver's wheel, a nation of pill poppers. The hundreds of millions of dollars spent on advertising by these vultures could and most certainly be should be poured into our national healthcare fund. Yes, tax the rich to pay for it - the pharmaceutical companies.

[afisher]

HUH????? Plavix is not used for lowering cholesterol, it is used to prevent blood clots.

That being said / corrected, the entire situation of advertising brand names is out of control, as then patient's who think they need a medication, MAY ask for it by name and what does a physician do? Take time to explain that there is a less expensive yet equally effective alternative? Notice that the patient has health insurance and therefore is unconcerned about the price?

If in fact, there are individuals who "demand" a medication based on advertisements...what does that say about the intelligence of the consumer?

[David Brier]

Being a business man and very result-oriented, I have to look at the bigger picture here: The overall state of health in the US is on a long-term decline, which is then met with new "breakthrough drugs" which spend MILLIONS to advertise the "conditions" they'll help solve, while raking in BILLIONS in revenue to companies that do little if any good. Remember the Ambilify ad stating "2 out of 3 people taking depression drugs are still depressed..." Oops. Maybe the answer ISN'T these drugs (or MORE drugs to help with your current cocktail) but getting back to basics. like laughing with friend, taking a walk, helping a neighbor. Now THAT would be a revolution in health care and end this dwindling cesspool of greed masquerading as authority.