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At the Intersection of Health, Health Care and Policy Cite this article as: Martin T. Gahart, Louise M. Duhamel, Anne Dievler and Roseanne Price Examining The FDA's Oversight Of Direct-To-Consumer Advertising Health Affairs, , no. (2003): doi: 10.1377/hlthaff.w3.120

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Health Affairs is published monthly by Project HOPE at 7500 Old Georgetown Road, Suite 600, Bethesda, MD 20814-6133. Copyright © 2003 by Project HOPE - The People-to-People Health Foundation. As provided by United States copyright law (Title 17, U.S. Code), no part of Health Affairs may be reproduced, displayed, or transmitted in any form or by any means, electronic or mechanical, including photocopying or by information storage or retrieval systems, without prior written permission from the Publisher. All rights reserved.

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Perspective Examining The FDA’s Oversight Of Direct-ToConsumer Advertising The FDA’s role as consumer protector has been adversely affected by recent changes in the way it notifies companies of their violations of rules governing DTC advertising of prescription drugs. by Martin T. Gahart, Louise M. Duhamel, Anne Dievler, and Roseanne Price ABSTRACT: Our analysis examined the effects of the Food and Drug Administration’s (FDA’s) 1997 draft guidance regarding advertisements for prescription drugs broadcast directly to consumers. We found that although direct-to-consumer (DTC) advertising spending by pharmaceutical companies has increased, more than 80 percent of their promotional spending is directed to physicians. DTC advertising appears to increase the use of prescription drugs among consumers. The FDA’s oversight has not prevented companies from making misleading claims in subsequent advertisements, and a recent policy change has lengthened the FDA’s review process, raising the possibility that some misleading campaigns could run their course before review.

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r o m 19 9 7 t h r o u g h 2 0 0 1 prescription drug spending increased at an annual rate of about 18 percent, and spending on direct-to-consumer (DTC) advertising of prescription drugs rose nearly 150 percent.1 In their paper Joel Weissman and his colleagues discuss the potential health consequences of DTC advertising of prescription drugs. The U.S. General Accounting Office (GAO) recently issued a report that examined the extent, effects, and federal oversight of DTC advertising since the Food and Drug Administration’s (FDA’s) 1997 draft guidance on broadcast advertisements for prescription drugs.2 Here we summarize the findings of

that report. n Scope of DTC ad spending. Between 1997 and 2001 spending for DTC advertising increased 145 percent, while other promotional spending increased 66 percent.3 According to industry estimates, in 2001 pharmaceutical companies spent $2.7 billion on DTC advertising and $16.4 billion on other promotional activities.4 Almost all spending on DTC advertising is concentrated among a small number of drugs that treat chronic conditions. For example, 86 percent of sales for the fifty most advertised drugs in 2000 were for drugs that treat allergy/asthma, arthritis, and high cholesterol.5 Most promotional spending is

The authors are all on the Health Care Issues team at the U.S. General Accounting Office (GAO) in Washington, D.C. Martin Gahart is an assistant director, Louise Duhamel and Anne Dievler are senior analysts, and Roseanne Price is a communications analyst. Health Affairs solicited this response to two papers, by Joel Weissman and colleagues and by Robert Dubois, which accompany this Perspective on the Health Affairs Web site, www.healthaffairs.org.

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targeted to physicians. In each year from 1997 of the drugs being advertised. Under the reguto 2001, providing drug samples to physicians lations, pharmaceutical companies are reand sending sales representatives to meet with quired to submit all drug advertisements to physicians accounted for more than 80 percent the FDA for review when they are first dissemof promotional expenditures.6 inated to the public. In 1997 the FDA issued n Effect on use of drugs. Drugs that are draft guidance to clarify and offer options on promoted directly to consumers often are how these regulations applied to DTC adveramong the best-selling drugs, and sales for tisements on radio and television. The FDA focuses its reviews on advertisesuch drugs have increased faster than sales for drugs that are not heavily advertised to con- ments that will be widely circulated or that are sumers. Most of the spending increase for the most likely to impart misleading impressions of a drug to consumers. heavily advertised drugs is For example, it reviews all the result of increased utiliza“The FDA’s broadcast DTC advertisetion, not price increases. For regulatory letters ments because of the large example, between 1999 and have not completely number of people who will 2000 the number of prescripdeterred see them. tions dispensed for the fifty n Effect of the FDA’s most heavily advertised drugs pharmaceutical rose 25 percent, but the numregulatory letters. When companies from ber dispensed for drugs that the FDA identifies a DTC admaking misleading were not heavily advertised vertisement that violates FDA claims in subsequent increased only 4 percent.7 guidelines, it sends a regulaadvertisements.” tory letter to the company Similar to the findings reresponsible for the advertiseported by Weissman and colment, asking that the comleagues, consumer surveys conducted by the FDA and others have consis- pany cease disseminating the advertisement. tently found that DTC advertisements influ- From August 1997 through August 2002 the ence consumers to ask their physician for a FDA issued eighty-eight regulatory letters for specific brand-name prescription drug. We DTC ad violations.9 The FDA issues regulatory found that the percentage of patients doing so letters for only a small percentage of the adverwas consistent across studies—about 30–35 tisements it reviews. Between 1991 and 2001, percent of those who remembered seeing a for example, it issued letters for about 5 percent DTC ad. In the consumer surveys we exam- of the broadcast advertisements it reviewed. FDA officials told us that pharmaceutical ined, about 5 percent of consumers requested and received a prescription from their physi- companies have complied with the FDA’s recian for a drug they were not currently taking, quests to cease dissemination of misleading in response to a DTC advertisement (the per- DTC drug advertisements in every case to centage ranged from 2 percent to 10 percent). date. For that reason, and because the FDA By our estimate, this means that in 2000 about does not want to remove a beneficial drug 8.5 million consumers received a prescription from the market, the FDA has yet to employ after viewing a DTC advertisement and asking any of the harsher remedies available. For example, the FDA has not initiated court action their physician for the drug.8 to seize drugs for which advertisements are Limits Of FDA Oversight false or misleading, nor has it asked a court to The FDA regulates the promotion of pre- stop the advertisement and direct the comscription drugs, including the content of DTC pany to run a corrective campaign. advertisements. Regulations require that adn Repeat offenders. The FDA’s regulavertisements present accurate information tory letters have not completely deterred pharand fairly represent both the benefits and risks maceutical companies from making mislead-

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ing claims in subsequent advertisements. Since 1997 the FDA has issued repeated regulatory letters to several pharmaceutical companies, including fourteen to GlaxoSmithKline, six to Schering Corporation, and five to Merck and Company.10 Some companies have received multiple regulatory letters over time for new advertisements promoting the same drug. For example, the FDA issued four regulatory letters to stop misleading advertisements for the allergy drug Flonase marketed by Glaxo Wellcome in 1999 and 2000. The violations cited in the letters include unsubstantiated efficacy claims, lack of fair balance, failure to provide any risk information on the major side effects and contraindications of the drug, failure to make adequate provision for disseminating the product labeling, and failure to submit the advertisement to the FDA. In addition, in the past four years the FDA issued four regulatory letters to Pfizer regarding broadcast and print advertisements for its cholesterollowering drug Lipitor. Among other infractions, the FDA noted that the advertisements gave the false impression that Lipitor can reduce heart disease and falsely claimed that Lipitor is safer than competing products. n Limitations of FDA effectiveness. The FDA’s ability to assess the compliance of pharmaceutical companies with its DTC advertising regulations is compromised because the FDA cannot verify that it receives all newly disseminated ads from pharmaceutical companies. The agency has issued six regulatory letters for misleading advertisements since 1997 that cited pharmaceutical companies for failing to submit their ads to the agency when they were first disseminated. FDA officials told us that the agency contracts with a commercial service that monitors television advertising to find advertisements that pharmaceutical companies have failed to submit for review. However, the service does not identify all advertisements that are broadcast on smaller networks, such as some cable television stations, or in some local markets. Indeed, in one case a misleading advertisement was broadcast for two calendar years in Puerto Rico before the FDA became aware of it.

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A change in the Department of Health and Human Services (HHS) policy for reviewing regulatory letters in late 2001 has reduced the FDA’s effectiveness in issuing regulatory letters in a timely manner—a key component of the FDA’s oversight. Any inaccurate impressions of a drug that are caused by a misleading advertisement are minimized if the advertisement is quickly removed from dissemination. FDA officials told us that prior to the policy change, regulatory letters were issued within several days of the receipt of an advertisement identified as misleading. In late 2001 HHS instructed the FDA that no regulatory letters could be issued until the FDA’s Office of the Chief Counsel (OCC) reviewed them. HHS implemented this new policy to ensure that all draft regulatory letters from the FDA were reviewed for “legal sufficiency and consistency with agency policy.” Since the policy change, OCC reviews of draft regulatory letters from the FDA have taken so long that misleading advertisements may have completed their broadcast life cycle before the FDA issued the letters. Five draft regulatory letters were submitted to the OCC between the date the policy took effect, 31 January 2002, and 5 September 2002 and were subsequently issued. The letters were issued from thirteen to seventy-eight days after they were first submitted to the OCC. However, we found that many television DTC advertisements are on the air for only a short time— about one-fifth of them for one month and about one-third for two months or less. Although we do not know the broadcast status of the advertisements targeted by the FDA’s draft regulatory letters, misleading advertisements could remain on the air after they are identified if the FDA maintains its current review policies.

Concluding Comments DTC advertising prompts millions of consumers to ask their doctors to prescribe specific brand-name drugs. As a result, the FDA must act effectively to minimize the public’s exposure to misleading DTC advertisements. While the FDA’s oversight is generally effec-

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tive at halting the dissemination of advertisements it reviews and identifies as misleading, the recent change in procedures for reviewing draft regulatory letters directed by HHS has adversely affected the FDA’s ability to enforce its regulations.

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2003). 10. Company names listed here are based on the names as of the date of the last regulatory letter that they received.

This paper is based on the U.S. General Accounting Office report, Prescription Drugs: FDA Oversight of Direct-to-Consumer Advertising Has Limitations. NOTES 1.

2.

3.

4. 5.

6.

7. 8. 9.

National Institute for Health Care Management Research and Educational Foundation, Prescription Drug Expenditures in 2001: Another Year of Escalating Costs (Washington: NIHCM, 2002); and calculated from figures provided by Pharmaceutical Research and Manufacturers of America, Pharmaceutical Industry Profile 2002 (Washington: PhRMA, 2002). The authors completed this report at the request of Senators Susan Collins (R-ME), James Jeffords (I-VT), and Barbara Mikulski (D-MD) and Representatives Joseph Hoeffel (D-PA) and Nick Rahall (D-WV). The full report is Prescription Drugs: FDA Oversight of Direct-to-Consumer Advertising Has Limitations, Pub. no. GAO-03-177, 28 October 2002, www.gao.gov/new.items/d03177.pdf (3 February 2003). Calculated from figures provided by PhRMA, Pharmaceutical Industry Profile 2002; and IMS Health Integrated Promotional Services, “Total U.S. Promotional Spending by Type, 2001,” 2002, www. imshealth.com/public/structu (17 July 2002). IMS Health, “Total U.S. Promotional Spending.” Calculated from figures provided by NIHCM Foundation, Prescription Drugs and Mass Media Advertising, 2000 (Washington: NIHCM, 2001). These figures do not include educational meetings arranged by pharmaceutical companies for physicians, which are not generally considered to be promotional activities. Drug companies spent about $1.9 billion on educational meetings in 2000. Calculated from figures provided by PhRMA, Pharmaceutical Industry Profile 2002; IMS Health, “Total U.S. Promotional Spending”; and NIHCM Foundation, Prescription Drugs. NIHCM Foundation, Prescription Drugs. From GAO, Prescription Drugs, Appendix II, 28. For the text of the FDA’s regulatory letters, see FDA, “Warning Letters and Notice of Violation Letters to Pharmaceutical Companies,” 22 January 2003, www.fda.gov/cder/warn (3 February

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