Pharma Spends Billions on Drug Ads, Fears Trump Administration Will Try to Ban Them

Drug companies report their biggest concern with the incoming Trump administration is the fear that the government will try to ban direct-to-consumer drug ads.

by Brenda Baletti, Ph.D.

Drug companies report their biggest concern with the incoming Trump administration is the fear that the government will try to ban direct-to-consumer drug ads, according to a new report from The Lever that examines the industry practice.

Companies said such a ban would “almost certainly” lead to a drop in drug sales, according to a recent report by industry research firm Intron Health, which claims the return on investment for drug ads is as high as 100%-500%, depending on the drug.

The U.S. and New Zealand are the only two countries that allow drug companies to advertise directly to consumers.

When President-elect Donald Trump’s nominee to lead the U.S. Department of Health and Human Services (HHS), Robert F. Kennedy Jr. (RFK Jr.), was running as a presidential candidate, he promised to ban the ads through an executive order on his first day in office.

When he tapped Kennedy, founder and former chairman of Children’s Health Defense, to lead HHS, Trump criticized drugmakers and Big Food companies, saying they “have engaged in deception, misinformation, and disinformation.”

If confirmed, Kennedy would oversee the U.S. Food and Drug Administration (FDA), which sets policies on direct-to-consumer advertising by pharma.

“We see this as the biggest imminent threat from RFK and the new Trump administration,” the Intron report’s authors wrote.

The Lever predicted the chances the administration can successfully ban these ads are “slim,” but said Big Pharma’s reaction shows how dependent the industry — and the media conglomerates it supports — has become on advertising drugs to consumers.

Critics say the ads “misinform patients and underemphasize treatment risks,” in part because they don’t provide all the information a patient needs to make an informed decision.

The ads also lead to unnecessary drug prescriptions, which The Lever said raises healthcare costs for consumers and taxpayers.

Most heavily advertised drugs don’t provide meaningful therapeutic benefit

Direct-to-consumer marketing in the U.S. began in 1981, with limited success at first because the FDA required drugmakers to list all possible side effects in the ads, according to The Lever’s short history of the practice.

Under the Clinton administration in 1997, the FDA relaxed its policies, allowing drugmakers to list only “major risks” in their ads, paving the way for a new and massive wave of television advertising for prescription drugs.

Spending on ads shot up 330% between 1996 and 2005, reaching $4.2 billion by 2004, and continued to grow after that.

Between 2016 and 2018, drugmakers spent $17.8 billion on ads for more than 550 drugs. Most of these drugs treat chronic medical conditions like arthritis, diabetes and depression.

According to a 2021 report by the congressional watchdog Government Accountability Office, 60% of the $560 billion that Medicare and its beneficiaries spent on drugs went to the advertised drugs.

The Lever claimed there are benefits to such advertising. Citing a paper from the National Bureau of Economic Research, it suggested that advertising can “somewhat” educate consumers and extend drug care to “undertreated patients.”

However, the report said advertising also increases the number of patients that request an advertised medication and the likelihood their prescriber will give it to them, whether they need it or not.

The ads also lead to greater use of higher-cost drugs over generics, even when those drugs offer no greater benefit.

The Lever cites a 2023 study in JAMA Network Open that assessed the “therapeutic value” — whether a drug led to improved clinical outcomes — of the top 73 most heavily advertised drugs. The study found that only 1 in 4 advertised drugs had a high therapeutic value.

Study author Neeraj Patel told The Lever:

“Many consumers might assume that the drugs they see all the time on TV are for cutting-edge therapies that are groundbreaking advances over the other treatment options on the market …

“Our study suggests that assumption is usually wrong: Heavily advertised drugs often do not necessarily provide meaningful therapeutic benefits as opposed to other therapeutic options.”

Obstacles to ending direct-to-consumer ads

The Lever said it is “relatively unlikely” Kennedy will be able to ban the ads, partly because efforts to merely restrict drug advertising have been defeated in courts on First Amendment grounds.

The New York Times and The Wall Street Journal made similar predictions. However, The Defender reported that a wider field of experts disagree on whether such a ban is legally or constitutionally feasible.

During Trump’s first administration, a federal judge blocked an HHS rule requiring drugmakers to include prices in their TV commercials, saying it exceeded the agency’s statutory authority.

“Kennedy could continue to push for cost transparency or require FDA review of all drug ads,” The Lever noted, “but any such reform attempts would likely be slow-going and challenged by the industry.”

Big Pharma’s lobbying arm, which spent $294 million lobbying last year on issues like drug ads, is also an obstacle.

TV and radio broadcasters are also expected to fight a drug ad ban because Big Pharma is one of the top advertising spenders. Last year, the National Association of Broadcaster industry lobbying group spent $8.8 million lobbying on issues including direct-to-consumer advertising, according to lobbying records.

Prescription drugs accounted for 30.7% of ad minutes across evening news programs on ABC, CNN, Fox News, MSNBC and NBC last year through Dec. 15, according to the WSJ.

The Lever proposed less drastic measures to “mitigate” some of the negative impacts of this advertising rather than banning it altogether.

For example, the FDA could require pharmaceutical companies to include disclaimers about the effectiveness of the drugs versus other drugs already on the market. Or drug companies could offer a “Drug Facts Box” label, that would provide one-page summaries of the risks and benefits of new drugs.

The agency could also extend its requirement, instituted in 2023, that TV and radio drug ads use “consumer-friendly” and “understandable” language to disclose potential side effects, applying it to over-the-counter medicines, dietary supplements or other products, which also account for hundreds of millions of advertising dollars.

“Even if all of those drug ads filling the TV and computer screens aren’t likely to go away soon, advocates hold out hope that regulators could at least require them to be more informative and comprehensible,” The Lever reported.

Related articles in The Defender:

• Can the Trump Administration Ban Big Pharma Advertising? Experts Weigh In

• ‘Ask Your Doctor’: Can’t Someone in Congress Make These Endless Drug Ads Disappear?

• ‘Dangerous’: Global PR Giant Launches Provocative HPV Vaccine Ads Targeting Gen Zers

• ‘Brought to You by Pfizer’: Pharma Giant Spends More on Ads, News Sponsorships, Than Research