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wasoxygen  ·  3139 days ago  ·  link  ·    ·  parent  ·  post: American Medical Association backs prescription drug ad ban

    ad dollars spent by drugmakers have risen to $4.5 billion in the last two years, a 30 percent increase

To clarify: spending reached $4.5 billion per year, up 30% from $3.5 billion in 2012.

Never mind those bars to the left showing that ad spending has increased only 9% over the past four years, they don't fit this story. (If these figures are not adjusted for inflation, it might represent a decrease in real dollars spent over four years.)

    Other data show prices on prescription drugs have climbed nearly 5 percent this year.

The AMA mentioned a 4.7% "spike" in generic and brand-name prescription drug prices in 2015, citing the Altarum Institute Center for Sustainable Health Spending. I find a report mentioning this 4.7% increase, alongside a hospital price increase of 1% and a decrease of 1% in physican and clinical services. Exhibit 5 shows that health prices overall have been tracking pretty closely with their inflation measure in recent years, with slightly faster growth in many years since 1990.

The reader is led to associate the increase in ad spending of $0.7 billion dollars with the increase of 4.7% in prescription drug prices. Total retail sales for prescription drugs filled at pharmacies in 2014 was about $260 billion. $0.7 billion is about 0.3% of this figure.

Perhaps the ads increase demand for treatment, some of which is unnecessary. Or perhaps ads increase demand for effective treatment as well. Is it necessarily bad that people spend more on medical care, instead of other things?

The AMA worries that ads drive demand for expensive treatment, when there are effective cheaper alternatives. People already need a doctor's approval to get prescription drugs. Shouldn't the AMA focus on encouraging doctors to make sound recommendations, rather than forcing big pharma to use less cost-effective methods of promotion?

But maybe doctors don't listen to the AMA anyway. 44% of them say drug ads at conventions are useful.