Direct-to-consumer advertising
Encyclopedia
Direct-to-consumer advertising (DTC advertising) usually refers to the marketing of pharmaceutical products but can apply in other areas as well. This form of advertising is directed toward patients, rather than healthcare professionals. The Food and Drug Administration holds responsibility of regulating DTC advertising. The FDA’s latest version of guidelines, though still in draft form, for pharmaceutical drug advertising was updated in 2009. Forms of DTC advertising include TV, print, radio and other mass
and social media
. There are ethical
and regulatory concerns regarding DTC advertising, specifically the extent to which these ads may unduly influence the prescribing of the prescription medicines based on consumer demands when, in some cases, they may not be medically necessary.
, North America
, and Europe
) banned direct advertising of pharmaceuticals to consumers.
The first direct-to-consumer print ad was for Merck & Co.
's Pneumovax, a pneumonia vaccine, which appeared in Reader's Digest
in 1981.
In 1982, the FDA prompted Eli Lilly and Company
to retract a press kit for its NSAID, Oraflex The FDA cited the "false and misleading" provision of risk information. DTC advertising was legalized in the US only after a 1985 Food and Drug Administration
(FDA) ruling, but the agency required the adverts to include a great amount of information on the risks of the drugs. Rufen, manufactured by Boots, was the first drug to be advertised on US television in 1983.
On May 13, 1983, Boots Pharmaceuticals (the US arm of a major British pharmaceutical company and pharmacy chain) launched the first TV ads for a prescription medicine in a test market; Tampa, Florida for the prescription brand of Ibuprofen called Rufen. The ads, featured CEO John D. Bryer, who delivered the message that Rufen was cheaper than Motrin. It was a price ad and made no efficacy claims and as such it did not include Package Insert information. The company also placed a full-page ad in the Wall Street Journal, and in the print ad, the full package insert, the prescribing information, was included.
Under pressure from doctors and the American Medical Association
, the FDA implemented a moratorium on all advertising in directed to patients. Liz Moench, who was then head of marketing at Boots USA and is now president and CEO of MediciGlobal, said: "We thought that way we could navigate this quagmire of FDA indecisiveness, but they were really grappling with how to address labeling and issues of communication." A moratorium on consumer advertising followed.
During this time, the FDA Food and Drug Administration
conducted consumer exchange meetings to gauge public reaction to direct-to-consumer advertising of prescription drugs. In 1985, the FDA issued a ruling that required advertising directed to consumers to include significant risk information about the prescription drug being advertised. Those long consumer warnings often required multiple pages (or infomercial
-length ads) to fully fulfill the requirement.
Claritin was approved in 1993, and DTC advertising was launched in 1995. At first, Schering-Plough
ran print ads and unbranded broadcast reminder ads, but it switched over to branded ads with its Blue Skies campaign. With older competitors like Seldane and Hismanal out of the way and newer drugs Zyrtec and Allegra
still in development, Claritin had the market for antihistamines all to itself. Schering-Plough spent $124 million on consumer advertising for Claritin.
Schering committed itself to a massive, broadcast-heavy multi-channel consumer campaign aimed at establishing universal brand awareness. Claritin's DTC spending peaked in 1998, at $142 million in measured media, according to TNS Media Intelligence data but remained strong over the course of five line extensions and a switch to over-thecounter in 2002.
On August 8, 1997, the FDA released its draft guidance that effectively enabled the use of broadcast ads for DTC. This allowed advertisers to forgo the requirement that they scroll or read the entire brief summary, provided they met an "adequate provision" standard for risk information as shown it began over a decade earlier.
As a result of the FDA's draft guidance, spending on DTC advertising increased from $220 million in 1997 to over $2.8 billion in 2002.
In 2002, the Secretary of Health and Human Services began requiring all draft FDA regulatory letters, including letters related to advertising violations, to be reviewed and approved by the FDA's Office of Chief Counsel before they are issued.
In 2004, Merck withdrew heavily-advertised Vioxx on safety concerns on September 30, provided a touchpoint for public ire over drug prices and threw a shadow over consumer promotion.
In 2005: Sepracor
launched Lunesta on April 4 and spendt $215 million on consumer advertising over the next eight months. Sanofi-Aventis
spent $88 million defending Zolpidem
's category leadership.
On 2 August 2005, Pharmaceutical Research and Manufacturers of America released its Guiding Principles on Direct to Consumer Advertisements About Prescription Medicines, with the intent to stop congressional action to end industry self-regulation.
This great amount of advertising has been successful in raising the prescription rate of DTC drugs by 34.2%, compared to only a 5.1% increase in other prescriptions.
That and many other aspects of DTC advertising made it very controversial among public health officials and physicians.
in this area, the government often backs up the consumer with protective laws.
The pharmaceutical industry as a whole has not been as quick as other sectors to jump on the digital marketing bandwagon, in part due to unclear guidelines from the FDA. Nonetheless, many direct-to-consumer (DTC) marketers are beginning to recognize the opportunities that new media offers for reaching consumers. Though the vast majority of DTC budgets are still allocated to traditional offline media such as television, newspaper, magazine and radio, marketers are beginning to shift some of their spending to digital activities such as product websites, online display advertising, search engine marketing, social media campaigns, and mobile advertising. Regardless of the advertising channel, pharmaceutical drug advertisers are continuing to increase the amount of money spent on DTC advertising with an increase of 330% from 1996 to 2005.
Mass media
Mass media refers collectively to all media technologies which are intended to reach a large audience via mass communication. Broadcast media transmit their information electronically and comprise of television, film and radio, movies, CDs, DVDs and some other gadgets like cameras or video consoles...
and social media
Social media
The term Social Media refers to the use of web-based and mobile technologies to turn communication into an interactive dialogue. Andreas Kaplan and Michael Haenlein define social media as "a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0,...
. There are ethical
Marketing ethics
Marketing ethics is the area of applied ethics which deals with the moral principles behind the operation and regulation of marketing. Some areas of marketing ethics overlap with media ethics....
and regulatory concerns regarding DTC advertising, specifically the extent to which these ads may unduly influence the prescribing of the prescription medicines based on consumer demands when, in some cases, they may not be medically necessary.
Nations permitting DTC
To date only two nations permit DTC (Nation, year of legalization, link to legislation permitting DTC)- New ZealandNew ZealandNew Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...
(1981) - United StatesUnited StatesThe United States of America is a federal constitutional republic comprising fifty states and a federal district...
(1997)
DTC and threats to national sovereignty
- CanadaCanadaCanada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
: US terrestrial broadcasters and some US cable broadcasters that have access to the Canadian market via Canadian Radio-television and Telecommunications Commission (CRTC) regulation have effectively overridden Canada's laws that forbid DTC with respect to the transmission of these ads into the Canadian market via these broadcasters. The CRTC has not evicted these broadcasters from access to the Canadian market. - MexicoMexicoThe United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
: there is a similar case of national sovereignty to Canada with respect to some US terrestrial broadcasters running ads in Spanish on the UnivisionUnivisionUnivision is a Spanish-language television network in the United States. It has the largest audience of Spanish language television viewers according to Nielsen ratings. Randy Falco, COO, has been in charge of the company since the departure of Univision Communications president and CEO Joe Uva...
network—where reception of these broadcasts is possible in Mexico (only the states of SonoraSonoraSonora officially Estado Libre y Soberano de Sonora is one of the 31 states which, with the Federal District, comprise the 32 Federal Entities of Mexico. It is divided into 72 municipalities; the capital city is Hermosillo....
and Baja CaliforniaBaja CaliforniaBaja California officially Estado Libre y Soberano de Baja California is one of the 31 states which, with the Federal District, comprise the 32 Federal Entities of Mexico. It is both the northernmost and westernmost state of Mexico. Before becoming a state in 1953, the area was known as the North...
are affected). - With the coming of DTV conversion of the US in 2009, Canada and Mexico may be less affected by US terrestrial broadcasters and the issue of DTC.
- US cable broadcasters on Canadian cable TV systems continue to be in violation even since 2009.
Pharmaceutical industry controversy
All western nations, with the exception of New Zealand and the United States, have historically (since the 1940s for AustralasiaAustralasia
Australasia is a region of Oceania comprising Australia, New Zealand, the island of New Guinea, and neighbouring islands in the Pacific Ocean. The term was coined by Charles de Brosses in Histoire des navigations aux terres australes...
, North America
North America
North America is a continent wholly within the Northern Hemisphere and almost wholly within the Western Hemisphere. It is also considered a northern subcontinent of the Americas...
, and Europe
Europe
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...
) banned direct advertising of pharmaceuticals to consumers.
The first direct-to-consumer print ad was for Merck & Co.
Merck & Co.
Merck & Co., Inc. , also known as Merck Sharp & Dohme or MSD outside the United States and Canada, is one of the largest pharmaceutical companies in the world. The Merck headquarters is located in Whitehouse Station, New Jersey, an unincorporated area in Readington Township...
's Pneumovax, a pneumonia vaccine, which appeared in Reader's Digest
Reader's Digest
Reader's Digest is a general interest family magazine, published ten times annually. Formerly based in Chappaqua, New York, its headquarters is now in New York City. It was founded in 1922, by DeWitt Wallace and Lila Bell Wallace...
in 1981.
In 1982, the FDA prompted Eli Lilly and Company
Eli Lilly and Company
Eli Lilly and Company is a global pharmaceutical company. Eli Lilly's global headquarters is located in Indianapolis, Indiana, in the United States...
to retract a press kit for its NSAID, Oraflex The FDA cited the "false and misleading" provision of risk information. DTC advertising was legalized in the US only after a 1985 Food and Drug Administration
Food and Drug Administration
The Food and Drug Administration is an agency of the United States Department of Health and Human Services, one of the United States federal executive departments...
(FDA) ruling, but the agency required the adverts to include a great amount of information on the risks of the drugs. Rufen, manufactured by Boots, was the first drug to be advertised on US television in 1983.
On May 13, 1983, Boots Pharmaceuticals (the US arm of a major British pharmaceutical company and pharmacy chain) launched the first TV ads for a prescription medicine in a test market; Tampa, Florida for the prescription brand of Ibuprofen called Rufen. The ads, featured CEO John D. Bryer, who delivered the message that Rufen was cheaper than Motrin. It was a price ad and made no efficacy claims and as such it did not include Package Insert information. The company also placed a full-page ad in the Wall Street Journal, and in the print ad, the full package insert, the prescribing information, was included.
Under pressure from doctors and the American Medical Association
American Medical Association
The American Medical Association , founded in 1847 and incorporated in 1897, is the largest association of medical doctors and medical students in the United States.-Scope and operations:...
, the FDA implemented a moratorium on all advertising in directed to patients. Liz Moench, who was then head of marketing at Boots USA and is now president and CEO of MediciGlobal, said: "We thought that way we could navigate this quagmire of FDA indecisiveness, but they were really grappling with how to address labeling and issues of communication." A moratorium on consumer advertising followed.
During this time, the FDA Food and Drug Administration
Food and Drug Administration
The Food and Drug Administration is an agency of the United States Department of Health and Human Services, one of the United States federal executive departments...
conducted consumer exchange meetings to gauge public reaction to direct-to-consumer advertising of prescription drugs. In 1985, the FDA issued a ruling that required advertising directed to consumers to include significant risk information about the prescription drug being advertised. Those long consumer warnings often required multiple pages (or infomercial
Infomercial
Infomercials are direct response television commercials which generally include a phone number or website. There are long-form infomercials, which are typically between 15 and 30 minutes in length, and short-form infomercials, which are typically 30 seconds to 120 seconds in length. Infomercials...
-length ads) to fully fulfill the requirement.
Claritin was approved in 1993, and DTC advertising was launched in 1995. At first, Schering-Plough
Schering-Plough
Schering-Plough Corporation was a United States-based pharmaceutical company. It was founded in 1851 by Ernst Christian Friedrich Schering as Schering AG in Germany. In 1971, the Schering Corporation merged with Plough to form Schering-Plough. On November 4, 2009 Merck & Co...
ran print ads and unbranded broadcast reminder ads, but it switched over to branded ads with its Blue Skies campaign. With older competitors like Seldane and Hismanal out of the way and newer drugs Zyrtec and Allegra
Fexofenadine
Fexofenadine is an antihistamine drug used in the treatment of hayfever and similar allergy symptoms...
still in development, Claritin had the market for antihistamines all to itself. Schering-Plough spent $124 million on consumer advertising for Claritin.
Schering committed itself to a massive, broadcast-heavy multi-channel consumer campaign aimed at establishing universal brand awareness. Claritin's DTC spending peaked in 1998, at $142 million in measured media, according to TNS Media Intelligence data but remained strong over the course of five line extensions and a switch to over-thecounter in 2002.
On August 8, 1997, the FDA released its draft guidance that effectively enabled the use of broadcast ads for DTC. This allowed advertisers to forgo the requirement that they scroll or read the entire brief summary, provided they met an "adequate provision" standard for risk information as shown it began over a decade earlier.
As a result of the FDA's draft guidance, spending on DTC advertising increased from $220 million in 1997 to over $2.8 billion in 2002.
In 2002, the Secretary of Health and Human Services began requiring all draft FDA regulatory letters, including letters related to advertising violations, to be reviewed and approved by the FDA's Office of Chief Counsel before they are issued.
In 2004, Merck withdrew heavily-advertised Vioxx on safety concerns on September 30, provided a touchpoint for public ire over drug prices and threw a shadow over consumer promotion.
In 2005: Sepracor
Sepracor
Sepracor, Inc. is a pharmaceutical company founded in 1984 by Tim Barberich. It was originally located in Princeton, New Jersey and then re-located to Marlborough, Massachusetts. On October 12, 2010, the company changed its name to Sunovion.-Company history:The company's initial focus was on the...
launched Lunesta on April 4 and spendt $215 million on consumer advertising over the next eight months. Sanofi-Aventis
Sanofi-Aventis
Sanofi S.A. is a multinational pharmaceutical company headquartered in Paris, France, the world's fourth-largest by prescription sales. Sanofi engages in the research and development, manufacturing and marketing of pharmaceutical products for sale principally in the prescription market, but the...
spent $88 million defending Zolpidem
Zolpidem
Zolpidem is a prescription medication used for the short-term treatment of insomnia, as well as some brain disorders. It is a short-acting nonbenzodiazepine hypnotic of the imidazopyridine class that potentiates gamma-aminobutyric acid , an inhibitory neurotransmitter, by binding to GABAA...
's category leadership.
On 2 August 2005, Pharmaceutical Research and Manufacturers of America released its Guiding Principles on Direct to Consumer Advertisements About Prescription Medicines, with the intent to stop congressional action to end industry self-regulation.
This great amount of advertising has been successful in raising the prescription rate of DTC drugs by 34.2%, compared to only a 5.1% increase in other prescriptions.
That and many other aspects of DTC advertising made it very controversial among public health officials and physicians.
Financial services
Consumer vulnerability to deceptive advertising is also particularly acute in the area of financial services. Individuals often have little knowledge of the workings of credit, leases, and security agreements. It is sometimes difficult to obtain information on such subjects that would be meaningful to the average consumer, so it is especially important that consumers be on guard against misleading or fraudulent advertisement. Because of the great inequality of bargaining powerInequality of bargaining power
Inequality of bargaining power is a concept used in social sciences and humanities, particularly law and economics to denote the situation where freedom of contract ceases to be real and markets fail....
in this area, the government often backs up the consumer with protective laws.
Digital and the evolution of direct-to-consumer advertising
Emerging media channels are causing the consumer channel mix to become increasingly fragmented. Individuals are no longer limited to just the television or newspaper to obtain their entertainment, news, and information, but can access content via websites, online video, social networks, mobile devices, and a variety of other ways. Consumers are especially shifting to new media sources for health and pharmaceutical information – over 145 million U.S. adults looked up health information online in 2008.http://www.manhattanresearch.com/research/white-papers/catch-the-new-pharma-marketing-wave.aspxThe pharmaceutical industry as a whole has not been as quick as other sectors to jump on the digital marketing bandwagon, in part due to unclear guidelines from the FDA. Nonetheless, many direct-to-consumer (DTC) marketers are beginning to recognize the opportunities that new media offers for reaching consumers. Though the vast majority of DTC budgets are still allocated to traditional offline media such as television, newspaper, magazine and radio, marketers are beginning to shift some of their spending to digital activities such as product websites, online display advertising, search engine marketing, social media campaigns, and mobile advertising. Regardless of the advertising channel, pharmaceutical drug advertisers are continuing to increase the amount of money spent on DTC advertising with an increase of 330% from 1996 to 2005.
External links
- Educating the Consumer about Advertising: Some Issues - from the Education Resources Information CenterEducation Resources Information CenterERIC - the Education Resources Information Center - is an online digital library of education research and information. ERIC is sponsored by the Institute of Education Sciences of the U.S. Department of Education...
Clearinghouse on Reading and Communication Skills, Bloomington, IndianaBloomington, IndianaBloomington is a city in and the county seat of Monroe County in the southern region of the U.S. state of Indiana. The population was 80,405 at the 2010 census....
. - Direct to Consumer Advertising in the United States SourceWatch: A Project of the Center for Media and Democracy
- http://www.mmm-online.com/40-years-of-DTC/article/35502/ 40 years of DTC by Matthew Arnold/Medicial Marketing and Media]
- http://www.manhattanresearch.com/research/white-papers/catch-the-new-pharma-marketing-wave.aspx Catch the New Pharmaceutical Marketing Wave: Trends & Strategies for Reaching Today's Healthcare Consumer
- AdPharm pharmaceutical advertising examples