January 08, 2019
3 min read

Direct-to-consumer medical ad spending rises $7.5 billion over 10 years

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Money spent on medical marketing greatly increased from 1997 through 2016, carried largely by a significant surge in direct-to-consumer advertising, which rose from $2.1 billion to $9.6 billion during that time, according to data published in JAMA.

“Health care spending in the United States is the highest in the world, totaling $3.3 trillion — 17.8% of the gross domestic product in 2016,” Lisa M. Schwartz, MD, MS, and Steven Woloshin, MD, MS, both from the Dartmouth Institute for Health Policy and Clinical Practice, wrote. “To capture market share and to expand the potential market, drug manufacturers, companies that manufacture clinical and home-based laboratory tests, and health care organizations use an array of promotional activities to sell their products and services.”

“These activities seek to shape public and clinician perceptions about the benefits and harms of health care, prescription drugs, laboratory tests, and specific diseases and their definitions,” they added.

Money spent on medical marketing greatly increased from 1997 through 2016, carried largely by a significant surge in direct-to-consumer advertising, according to data.
Source: Shutterstock

To analyze the marketing of prescription drugs, disease awareness campaigns, health services and laboratory tests, as well as the related consequences and regulation surrounding such efforts, in the United States from 1997 through 2016, the researchers evaluated direct-to-consumer marketing, marketing to professionals and FDA and Federal Trade Commission actions and settlements. In addition, Schwartz and Woloshin conducted a literature search of peer-reviewed articles, business journals and news media regarding consumer and professional medical marketing.

For direct-to-consumer advertising information, the researchers studied Kantar Media data for spending and number of advertisements in 1997, 2004, 2008, 20112 and 2016. For marketing to professionals, they obtained data from the IQVIA Institute for Human Data Science, as well as open payments data from CMS. The literature media reviews included searches of PubMed, Business Source Ultimate and Lexis Nexis from 1975 to 2018. All spending is reported in 2016 dollars.

According to the researchers, spending on marketing drugs, disease awareness campaigns, health services and laboratory testing increased from $17.7 to $29.9 billion from 1997 through 2016. Among this rise in spending, the most rapid increase was in direct-to-consumer advertising, which increased from 11.9% of total spending in 1997 to 32% of total spending in 2016.

In addition, during this time, direct-to-consumer prescription drug advertising increased from $1.3 billion and 79,000 total advertisements, to $6 billion, and 4.6 million advertisements, including 663,000 TV commercials. This coincided with a shift toward advertising high-cost biologics and cancer immunotherapies.


Pharmaceutical companies increased spending on direct-to-consumer disease awareness campaigns — specifically for diseases treated by their drugs — from $177 million in 1997 to $430 million in 2016. In addition, direct-to-consumer advertising for health services increased from $542 million to $2.9 billion during this time, with the largest spending increases coming from hospitals, dental centers, cancer centers, mental health and addiction clinics and home health medical services. Direct-to-consumer spending on advertising for laboratory tests increased from $75.4 million in 1997 to $82.6 million in 2016.

Marketing to health care professionals by pharmaceutical companies accounted for the majority of promotional spending and increased from $15.6 billion in 1997 to $20.3 billion in 2016. Of that $20.3 billion, $5.6 billion was spent on prescriber detailing, $13.5 billion for free samples, $979 million for direct physician payments — such as speaking fees and meals — related to specific drugs, and $59 million for disease education.

“Medical marketing matters because it influences behaviors and choices that can have important health consequences and may also may adversely influence efforts to control unsustainable health care spending,” Woloshin told Healio Rheumatology. “For example, while marketing may have positive effects like destigmatizing diseases, such as HIV, or embarrassing symptoms, such as impotence, it can also raise false hopes by exaggerating treatment effects — for example in the marketing of marginally effective Alzheimer’s drugs. This can lead to overdiagnosis and overtreatment, with associated harms and wasted resources.” by Jason Laday

Disclosure: Schwartz and Woloshin report having served as medical experts in testosterone litigation and were the cofounders of Informulary, a company that provided data about the benefits and harms of prescription drugs, which ceased operations in December 2016.