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Issue Brief
Pharmaceutical Industry Marketing
How much does the pharmaceutical industry spend to market its drugs?
Reports of pharmaceutical and medical device industry marketing expenditures vary.
The following are some recent estimates:
• $20.4 billion in 2007 (Verispan)
• $29.8 billion in 2005 (IMS)
• $57.5 billion in 2004 (Gagnon 2008 - CAM and IMS data combined)
• $54 billion in 2001 (Angell 2004 - Extrapolation from Novartis annual reports)
What do these totals include?
Estimates of pharmaceutical marketing normally include detailing, journal advertising, pharmaceutical samples and direct-to-consumer advertising. Detailing is the largest industry marketing segment after expenditures on pharmaceutical samples. It is the industry term for face-to-face sales and promotional activities directed toward office- and hospital-based physicians and directors of pharmacies. It includes pay for sales representatives and the meals and gifts they provide. IMS data includes expenditures to “field the rep” but not the cost of managers and training.
What can be done to protect patients, control health care costs, and bolster professionalism among physicians?
The Prescription Project promotes a range of solutions for consumers, physicians, state and federal policy makers, and public and private payers. For more, visit our website. www.prescriptionproject.org.
Download the full PDF for more information.
"The legislation requiring public disclosure of the financial relationships between healthcare vendors and physicians has been widely discussed in policy circles for years. Critics claimed payments for speaking, consulting, research or even the small trinkets and meals delivered during routine sales calls unduly influenced physician choices and inflated healthcare costs. To combat those effects, Congress required public reporting of those payments in a publicly accessible database. The legislation, labeled the Physician Payment Sunshine Act, was included in the 2010 healthcare reform law."
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Prescription project director Danny Carlat identifies issues with the Physician Payments Sunshine Act requiring further clarification and guidance. Addressing those would ensure that manufacturers can appropriately implement the final rule, and enable consumers to benefit from transparency reports published by the Centers for Medicare & Medicaid Services.
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The Pew Charitable Trusts is working to decrease the influence of pharmaceutical marketing on doctors’ practices. With a three-year grant from the Attorney General Consumer and Prescriber Education Grant Program, Pew is collaborating several partners to improve conflict-of-interest policies within the 158 medical schools and 400 major teaching hospitals in the United States.
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The Pew Charitable Trusts appreciates this opportunity to submit comments to CMS's "Information Collection Activities" draft guidance. We suggest that both the research and non-research payment templates be modified in order to make it easier for consumers to identify which drugs, devices, biologicals, or medical supplies are associated with particular transfers of value.
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On Feb. 1, 2013, the Centers for Medicare & Medicaid Services published the final rule guiding implementation of the Physician Payments Sunshine Act, which Congress passed as part of the Affordable Care Act in March 2010 to increase transparency in the relationships between physicians and drug and medical device makers. Here are some of the highlights.
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