Pharmaceutical Marketing in Washington, DC: Expenditures and Impacts on Healthcare

Prescription drugs contribute a great deal to improved healthcare, but growth in prescription drug costs presents challenges for payers with limited healthcare funds and may create conflicts of interest for prescribers. Marketing of new, more-expensive products may encourage the use of higher-cost medications when other products may be safer, more effective or more cost-effective. The District of Columbia passed legislation in 2004 requiring that manufacturers of prescription drugs annually report marketing costs, including DC advertising expenses, gifts valued at more than $25, and costs association with employees who engage in marketing activities in DC. This study analyzes the data provided to the DC Department of Health for expenditures between 2006-2008. Over these three years, manufacturers spent over $390 million on these activities, with more than 100 companies reporting expenditures each year. The largest proportion of the $390 million was for expenses associated with employees and contractors engaged in marketing (e.g., "detailers"). Gifts – including consultant payments, speaker fees, food and other gifts – to doctors and other health professionals and to institutions, professional organizations and disease-specific organizations represent approximately 20% of expenses. Advertising expenditures were reported as constituting less than 10% of total marketing spending, and many companies reported no DC-specific advertising at all. Direct-to-consumer and other forms of advertising may have impact on prescribing practices, and may be under-reported to DC because national advertising that reaches the DC population is not required to be disclosed. Data on major therapeutic classes and drug groups accounting for high proportions of Medicaid spending in DC will be presented. We also evaluated the extent to which DC Medicaid providers may be acting as key opinion leaders (indicated through a single provider's receipt of $1,000 or more from a company) and the pattern of gifts received by professional organizations and disease-specific organizations, including those that offer continuing medical education. Policies of the medical schools in DC that limit contact or gifts between pharmaceutical representatives and medical students also will be discussed. These analyses provide insight into pharmaceutical marketing practices and patterns in Washington, DC that may create financial conflicts of interests for providers and may impact the cost and quality of healthcare provided.