E-DRUG: Spending on drug promotion
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There is an article that has just been published in PLoS Medicine that
estimates that drug companies spend $57.5 billion on promotion in the U.S. -
twice the amount previously thought. Here is the abstract for the article:
Introduction
The amount spent on pharmaceutical promotion versus research and development
is central to the debate around whether the pharmaceutical industry is
primarily driven by innovation or marketing. Information on promotional
expenditures from IMS, the most widely quoted authority that surveys
pharmaceutical firms, may not be reliable.
Methods
We accessed data from CAM, a global market research company dedicated to
survey physicians to audit promotional and marketing activities undertaken
by the pharmaceutical industry, compared its estimates to those from IMS and
determined the relevant figures from both organizations in each category of
promotional expenditures to arrive at a new estimate of total spending.
Results
Pharmaceutical promotion in the United States in 2004 is as high as $57.5
billion compared to the figure of $27.7 billion given by IMS. Excluding
direct-to-consumers advertising and promotion towards pharmacists, the
industry spent around $61,000 in promotion per practicing physician.
Comment
As a percent of U.S. domestic sales of $ 235.4 billion, promotion consumes
24.4% of the sales dollar versus 13.4% for R&D. In light of these numbers,
one can safely argue that marketing is predominant over R&D in the
pharmaceutical industry, contrary to the industry¹s claim.
Joel Lexchin
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Joel Lexchin MD
121 Walmer Rd.
Toronto ON
Canada M5R 2X8
Tel: 416-964-7186
Fax: 416-736-5227
E mail: joel.lexchin@utoronto.ca