Direct-to-physician activities accounted for the bulk of spending, with $5.3 billion spent on a practice called "detailing" visits to physicians by pharmaceutical sales representatives in order to promote their firm's drugs. Free drug samples distributed during these visits were valued at roughly $16.4 billion.
"As the cost of prescription drugs continues to escalate, increased attention is being focused on the role of pharmaceutical marketing practices as a cause of higher drug prices," said Robert Jacobson, professor of marketing at the University of Washington Business School and co-author of the paper appearing in the December issue of Management Science.
"The concern that pharmaceutical marketing practices compromise physician integrity and have exacerbated increases in public health costs has prompted government actions at both the federal and state levels. The key public policy issue is the extent to which the industry's promotional tactics lead to an increase in appropriate versus inappropriate use of drugs in a cost- effective manner."
In the study, researchers analyzed data for three widely prescribed drugs issued by some 74,000 physicians over a two-year period to investigate the effect of pharmaceutical sales representatives on physician prescribing behavior. For each of the drugs in the study, Jacobson and Natalie Mizik, assistant professor of marketing at Columbia University, assessed the effects of changes in the numbers of sales calls and free samples on the number of new prescriptions the physician issued.
A detailing visit typically lasts two to five minutes, and information about a drug's composition, therapeutic value, proper dosage and potential s
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Contact: Nancy Gardner
nancylou@u.washington.edu
206-543-2580
University of Washington
7-Dec-2004