What the AMA's Proposed DTC Ban Overlooks
Hensley Evans is a principal at ZS.
Last November the American Medical Association adopted a policy to call for a ban on direct-to-consumer advertising of prescription drugs and medical devices.
The AMA is certainly not the first organization (nor will it be the last) to call for limitations or bans on DTC advertising. The US is the only country other than New Zealand that allows advertising for drugs and medical devices.
Previous criticisms of drug advertising suggested that DTC ads might drive inappropriate demand for drugs among consumers. While DTC advertising does significantly impact consumer demand, most evidence suggests the majority of this demand benefits the overall state of consumer health.
See also: AMA calls for DTC advertising ban
First, DTC advertising drives broader awareness of diseases that might otherwise go undiagnosed or untreated. This leads consumers to discuss conditions with healthcare professionals and results in earlier diagnosis and treatment. This is particularly true for unbranded or “disease awareness” campaigns that focus on educating the public on broader conditions—not just specific medications.
In addition, DTC advertising can improve medication adherence to specific brands advertised and other brands in the category. This, in turn, can slow disease progression and improve overall health outcomes.
The new AMA policy recommendation focuses on a different issue. In the words of board chair-elect Dr. Patrice Harris, DTC advertising “inflates demand for new and more expensive drugs, even when these drugs may not be appropriate.” Because the majority of DTC advertisements feature relatively new and more expensive drugs, the AMA argues that these ads drive consumers to request pricier treatments instead of less expensive options that may also be available.
The AMA policy suggests two ways in which DTC advertising increases healthcare costs. First, it suggests advertising itself increases the cost of drugs. In a free-market economy, if demand for a product increases and supply holds constant, prices will increase. However, the highly regulated US market for pharmaceutical products is not a free market economy and has several gatekeepers.
Second, Dr. Harris proposes that a key disadvantage of advertising—and the main reason the AMA believes ads inflate healthcare costs—is the resulting increased demand for more expensive drugs compared to cheaper alternatives. Although a ban on DTC advertising would not necessarily decrease the cost of the specific drugs, it would prevent consumers from demanding newer and more expensive treatments.
In cases where cheaper alternatives are as good as the newer, more expensive medications advertised, physicians regularly communicate to patients that there may be a better (or more appropriate) product for them. This may create more work for physicians, or patients may not understand why the drug they saw advertised is unnecessary or inappropriate for them. However, advertising can help create better-educated patients in the long run.
In many cases, though, cheaper alternatives have very different characteristics from new drugs advertised—in efficacy, side effects and mechanisms of action—and that means they may not be equally preferable for patients. In these cases, payers and providers might prefer patients first try the older (cheaper) medication before a new one, even if the new medication is expected to have superior efficacy or side-effect profiles.
The less expensive medication might, in fact, work for the patient, and its side effects could be minimal or tolerable. However, if you are the individual being treated, you would likely prefer to start with the best medication first, especially if both alternatives cost the same from your perspective. The conflict lies at the heart of managing healthcare costs as a system.
One of the roles DTC ads can and should play is to educate patients on medication options. More educated patients are better equipped to hold an informed conversation with their physician on the trade-offs between alternatives and take into account all factors, including efficacy, side effects, mechanisms of action and cost.
The AMA has the best intentions: to lower healthcare costs and continue to provide appropriate care to patients. But by proposing a total ban on DTC ads, the AMA is essentially suggesting that it is better for consumers to remain unaware of newer, more expensive and often more effective or tolerable treatments.
An alternative perspective is that DTC advertising can help better educate patients to take all factors into account and participate actively in the decision about which drug is right for them.
At a time when we expect—or even demand—consumers take more accountability for their health, it seems contradictory to simultaneously suggest that they remain unaware of all treatment options. Patients want, need and deserve complete and accurate information on treatment choices to make better decisions about their healthcare.
Hensley Evans is a principal at ZS.