Big Pharma Spends More On Advertising Than Research And Development, Study Finds

[Celebration]

http://www.sciencedaily.com/releases/2008/01/080105140107.htm

ScienceDaily (Jan. 7, 2008) — 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.

..............snip

“In our paper, we make the case for the need for a new estimate of promotional expenditures by the U.S. pharmaceutical industry,” says Gagnon. “We then explain how we used proprietary databases to construct a revised estimate and finally, we compare our results with those from other data sources to argue in favor of changing the priorities of the industry.”

The study is important because it provides the most accurate image yet of the promotional workings of the pharmaceutical industry, says Lexchin.

.............snip

Thus, the study’s findings supports the position that the U.S. pharmaceutical industry is marketing-driven and challenges the perception of a research-driven, life-saving, pharmaceutical industry, while arguing in favour of a change in the industry’s priorities in the direction of less promotion, according to Gagnon and Lexchin.

[NanceGreggs]

1. In addition to which ...

As a court reporter who specializes in litigation between pharmaceutical companies (usually patent ownership disputes), you don't want to KNOW what they spend on legal proceedings ...

[Celebration]

3. I can only imagine

A friend of mine was on one of those "practice" juries in a patent dispute. A medical device company had basically stolen a design from a physician inventor and refused to pay him any money. When she was telling me about it later (after the actual trial), it just sounded ridiculous. The company had absolutely no defense for this. I guess they were hoping that the lawsuit would just go away or the inventor would die before it came to trial. This didn't work. I think they ended up even getting hit for punitive damages!

I would sure hate to be the CEO of one of those companies if that is the behavior that the investors desire. Sometimes I wonder how some of these people sleep at night.

[NanceGreggs]

5. The sleep very well at night ...

... the same as CEOs of insurance companies. That's because these people obviously have no conscience. It's the only plausible explanation.

[Raster]

12. Not to mention what they pay their lobbyists....

to receive their preferential legislation!

[Atman]

2. Advertising is completely tax deductible

Which means WE PAY to advertise the drugs to ourselves. Yet we still cannot afford them.

.

[Celebration]

4. sure, but we pay even more

when our insurance premiums and government payments rise to cover the cost of the increased demand for prescription drugs (which is directly caused by the advertising). Oh, and of course the cost of the actual drug goes up (per pill) to pay for the advertising. So we are hit with increased costs from all sides, whether or not we ingest the stuff.

[NanceGreggs]

6. Imagine paying $50 for a loaf of bread ...

... because the bakery that produces it "needs" to put that money into R&D, hopefully to produce a better loaf of bread.

They always make it sound like they're running a charitable, non-profit organization - as though they're not going to charge through-the-nose for any "new drug" that results from their R&D the minute it hits the market.

[Sarah Ibarruri]

7. Now why doesn't that surprise me at all? nt

[Crunchy Frog]

8. I wonder how much goes into lobbying

or is that included in the promotion figures?

[Evoman]

9. self delete.

[supernova]

10. That's been true for at least 10 years

if not longer.

When I worked at the cancer center at Duke in the mid-late 1990s, we were all aware of what their R&D budgets (hospitals want research grant money after all) were compared to their advertising budgets.

But it's disappointing to have this point confirmed yet again. *sigh*

[varkam]

11. That's one of the big problems with the pharmaceutical industry.

The pharmaceutical industry sometimes gets a bad rap, but here it's completely deserved. It's interesting to see some actual data on just how much more money they spend on adverts than on research (and by interesting, I mean along the lines of the Chinese curse "May you live in interesting times"). Partly it's just an extension of what happens when someone has a product in a free-market economy and wants to sell it, but the downside is the medicine is necessary, that it costs so much, and that partly why it costs so much is that you can't turn on the TV anymore without hearing "Ask your doctor if..."

[spooky3]

13. This has been true for a long time.

The authors of the study probably cited prior research showing the same thing, but the media report didn't include it.