Does Pharma Spend More On Ads Than R&D?
By Justin Gardner | Related entries in Drugs, Economy, Health Care, Money
It wouldn’t surprise me, and if it’s the case, something needs to be done.
A new study by two York University researchers estimates the U.S. pharmaceutical industry spends almost twice as much on promotion as it does on research and development, contrary to the industry’s claim.The researchers’ estimate is based on the systematic collection of data directly from the industry and doctors during 2004, which shows the U.S. pharmaceutical industry spent 24.4% of the sales dollar on promotion, versus 13.4% for research and development, as a percentage of US domestic sales of US$235.4 billion. [...]
As well, note the authors, the number of meetings for promotional purposes has dramatically increased in the U.S. pharmaceutical industry, jumping from 120,000 in 1998 to 371,000 in 2004, further supporting their findings that the U.S. pharmaceutical industry is marketing-driven.
Listen, I believe in free markets, capitalism, etc, but if these companies are really spending more to market their products than developing them, then consumers simply aren’t paying fair prices for needed medication. And the free market is supposed to bring the most competitive prices, not the most expensive marketing campaigns.
And do know that all this advertising does is create demand for products that people don’t even need. Talk to any doctor and you’ll hear the same story. People come in asking for “The Purple Pill” when a different medication (or none) would be better. But because people have been seduced, they insist on it. What’s a doctor to do?
Also, I haven’t even touched on all the free stuff doctors get from these companies to pimp the branded product over the generic.
Time to start rethinking how we allow companies to market this stuff in our already overmedicated society.
This entry was posted on Tuesday, January 8th, 2008 and is filed under Drugs, Economy, Health Care, Money. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
January 8th, 2008 at 12:54 pm
This article does not mention the amount of Money spent on research as an absolute number, but rather as percentages of current industry spending.
In other words, the Pharma industry supposedly spends 13% of 235 billion, which is approx 32 billion on research. Is that total amount of money more than what was spent prior to when those marketing numbers went up? It used to be that prescription drugs weren’t allowed to be advertised, about 15 years ago that changed. How much money in absolute terms did Pharma companies spend on research before then?
Have the Pharma companies grown so significantly in the past 15 years, that the total amount of research has increased overall, with the marketing partly responsible for bringing in the extra capitol?
If so, then its worth it.