Summary

The author has released its latest research, “Direct to Consumer (DTC) Advertising in Pharmaceuticals - Current and Future Market Outlook, Regulatory Landscape and Case Studies.” The research provides key data, information and analysis of the major issues affecting the stakeholders of the direct to consumer (DTC) advertising market in the US and Europe. It discusses the major changes that have been observed after the relaxation of rules over DTC advertising by the FDA in 1997. The report also covers the issues specific to the European market (where branded DTC advertising is banned). The report provides a comprehensive view of some of the best examples of DTC advertising along with analysis covering the reasons for such success. The report also provides a detailed analysis of failed examples along with the most important lessons. It also provides an insight into government regulations in the US and Europe covering DTC advertisements and their implications for the marketing strategies of the pharmaceutical companies. The study provides a detailed explanation of some of the major reasons behind recent developments in the pharmaceutical DTC advertising landscape. At the end, the report touches upon some of the major trends that are likely to shape the future landscape for the DTC advertising market in the US and Europe.

This report is built using data and information sourced from proprietary databases, primary and secondary research and in-house analysis by GBI Research’s team of industry experts.

Scope

The scope of this report includes:
- Identification and analysis of major issues that are affecting the DTC advertising marketplace in the US and Europe
- Case studies of DTC advertising strategies of Pfizer, AstraZeneca, Merck and Sanofi-Aventis and so on
- Estimation and analysis of potential impact of the issues on the key stakeholders affected by the DTC advertisement market developments
- Analysis of key government regulations in the US and Europe affecting the DTC advertising market
- Future trends that will shape the DTC advertising market in the US and Europe

Reasons to buy

The report will enhance your decision making and will enable you to:
- Develop effective business strategies to tackle the impact of major issues to the key stakeholders in the DTC advertising market
- Understand the DTC advertising strategies that succeeded and failed for the major drugs of key pharmaceutical players
- Ensure success through more effective marketing strategies for the drugs that are to be launched or already in the market
- Identify and exploit the factors that could help to maximize returns on drugs through better advertising
- Optimize your advertising impact through identification of the most suitable medium for your drug
- Develop understanding of the regulatory attitude and hurdles for DTC advertising in the geographies covered in the report

Table Of Contents

1 Table of Contents
1 Table of Contents 4
1.1 List of Tables 6
1.2 List of Figures 7
2 Introduction 8
2.1 GBI Research Report Guidance 8
3 DTC Advertising in the US - Double-edge Sword for Both, Patients and Pharma Companies 9
3.1 FDA Rule Triggering the Rise 9
3.2 Media for DTC Advertisements 12
3.2.1 Television 13
3.2.2 Print 13
3.2.3 Internet 13
3.3 Budget Allocation for DTC Advertising - Decision Parameters 14
3.3.1 Nature of the Disease 14
3.3.2 Prevalence of the Disease 14
3.3.3 Patient Preferences for Advertising Channels 15
3.3.4 Target Population 15
3.3.5 Degree of Market Competition 15
3.3.6 Future Prospects for Brand 15
3.3.7 Future Prospects for the Market 15
3.4 Benefits of DTC Advertising 15
3.4.1 Adds to the Bottom-line of the Pharmaceutical Companies 15
3.4.2 Increases Disease Awareness and Treatment Rate 16
3.4.3 Increases Patient Compliance 17
3.5 Successful DTC Advertising Campaigns 17
3.5.1 Pfizer’s Lyrica 17
3.5.2 AstraZeneca’s Symbicort 19
3.6 Concerns with DTC Advertising 20
3.6.1 DTC Expenditure Outpacing the RandD Expenditure 20
3.6.2 Misleading Advertisements 21
3.6.3 Consumer Safety 22
3.6.4 Driving Demand for Expensive and Inappropriate Drugs 23
3.7 Failed Campaigns 24
3.7.1 Merck’s Vioxx 24
3.7.2 Merck’s Gardasil 25
3.7.3 Sanofi-Aventis’ Ambien 27
3.7.4 Pfizer’s Lipitor 28
3.8 Impact of DTC Advertising 29
3.8.1 Change in Patient-Physician Relationship 30
3.8.2 Increased Patient Engagement in the Treatment 30
3.9 Conclusion 31
4 DTC Advertisements Today - Adverse Economic and Regulatory Scenario Creates a Discouraging Market 33
4.1 DTC Advertising Expenditure on a Decline 33
4.1.1 Lack of DTC-Worthy Blockbuster Drugs 34
4.1.2 Misleading Advertisements and False Claims - DTC under Fire from the US Congress 35
4.1.3 Shift to More Cost-Effective Media 39
4.1.4 Damage to the Image of the Pharmaceutical Companies 41
4.2 Change in the Role of Television - Complementing Internet based Advertising 42
4.3 Internet as an Emerging Media - Encouraging Integrated Advertising Strategies 43
4.4 Conclusion 44
5 DTC Advertising in Europe - Possibility for Branded DTC Advertising Penetration 45
5.1 Sandoz (1996) - Set the Stage 46
5.2 DTC in Europe - Informative and NOT Promotional 46
5.2.1 Pfizer’s Viagra 48
5.2.2 Pharmacia’s Detrusitol/Detrol 49
5.2.3 Roche’s Xenical 51
5.3 Internet - A Key Tool in Absence of Traditional DTC 52
5.3.1 Internet Based Advertising Controversy - eBMJ (British Medical Journal) 52
5.4 EU Regulations for DTC Advertising 55
5.4.1 High Level Pharmaceutical Forum - A Move to Push Branded DTC advertising in Europe 55
5.4.2 EC Proposal on Restricted Branded Advertising - Possible Entry Point for DTC Advertising Penetration in the Continent 56
5.5 Conclusion 57
6 Future of DTC Advertising - Integrated and Personalized Advertising to be the Key to Success 58
6.1 Future DTC Advertising Expenditure - Regulatory and Political Landscape will Determine the Growth 58
6.2 DTP (Direct-to-Patient) Advertising - Engaging Instead of Promoting 59
6.3 Move towards Social Media 61
6.3.1 Collaborating with Patient Groups - An Opportunity to Increase Patient Compliance 61
6.3.2 Dedicated Video Sites 61
6.4 Measuring Effectiveness of DTC Advertising 62
6.4.1 Future Challenges in Measuring DTC Advertising Effectiveness - Different Media would Increase Complexities 63
6.5 Regulations for DTC Advertising on Digital Media - Search Engine, First Target 63
6.5.1 MTV’s Banner Ad of Barr’s Plan B - Brought Online Advertising to FDA Sight 64
6.5.2 FDA’s Untitled Warning Letters to Pharmaceutical Companies on Search Engine Advertisements 64
6.6 Conclusion 65
7 Key Takeaway 67
8 Appendix 69
8.1 Definitions 69
8.2 List of Abbreviations 69
8.3 Sources 70
8.4 Methodology 70
8.4.1 Secondary Sources 70
8.4.2 In-house Analysis 71
8.4.3 Expert Panel Validation 71
8.5 Contact Us 71
8.6 Disclaimer 71


1.1 List of Tables
Table 1: Lyrica Worldwide Sales, $m, 2004-2008 18
Table 2: Symbicort Worldwide Sales, $m, 2001-2008 20
Table 3: Merck’s DTC Advertisement Spend on Vioxx, $m, 2000-2004 24
Table 4: Gardasil Worldwide Sales, $m, 2006-2008 26
Table 5: Lipitor Worldwide Sales, $m, 1999-2008 29
Table 6: Number and Value of the Current Blockbuster Drugs going Off-Patent by 2014 34
Table 7: Differences in the US and Europe Healthcare System in Context of DTC Advertising 45
Table 8: Viagra Worldwide Sales, $m, 1998-2008 49
Table 9: Detrusitol/Detrol Worldwide Sales, $m, 2003-2008 50
Table 10: Xenical Worldwide Sales, $m, 1999-2008 51
Table 11: Breakdown of Late-Stage Pipeline by Type of Compounds for 20 Major Pharma Companies 59


1.2 List of Figures
Figure 1: FDA Rules For DTC Advertising Before and After 1997 10
Figure 2: Total Promotional Spending on Prescription Drugs, $bn, 1996-2004 11
Figure 3: Percentage Change in Selected National Health Expenditures, 1980-2001 12
Figure 4: Breakdown by Media of the Total Pharmaceutical DTC Advertising Spend in the US, 2008, Total = $4.3bn 13
Figure 5: Factors Determining DTC Budget Allocation to Brands and Selection of Marketing Mix 14
Figure 6: Lyrica Worldwide Sales, $m, 2004-2008 18
Figure 7: AstraZeneca on Moving Digital for DTC Marketing 19
Figure 8: Symbicort Worldwide Sales, $m, 2001-2008 20
Figure 9: Comparison of Growth in Promotional Expenditure v/s RandD Expenditure, %, 1998-2004 21
Figure 10: John Dingell, Chairman, Committee on Energy and Commerce, on His Concern over Misleading DTC Advertisements 22
Figure 11: Suzanne Hill, Scientist at WHO, on Unprecedented Increase in Healthcare Costs in the US due to DTC Advertising 23
Figure 12: Merck’s DTC Advertising Spend on Vioxx, $m, 2000-2004 24
Figure 13: FDA Warning to Merck on Vioxx 25
Figure 14: Gardasil Worldwide Sales, $m, 2006-2008 26
Figure 15: Californian Democrat Henry Waxman on FDA’s Laxity over DTC Advertisements 27
Figure 16: Lipitor Worldwide Sales, $m, 1999-2008 29
Figure 17: Arguments FOR and AGAINST DTC Advertising in the US 31
Figure 18: DTC Advertising Spend, $bn, 1996-2008 33
Figure 19: Number and Value in 2008 of the Current Blockbuster Drugs going Off-Patent by 2014 34
Figure 20: FDA Guidelines on DTC Advertising, May 2009 36
Figure 21: Ken Johnson, SVP PhRMA, on Defending the DTC Advertisements 37
Figure 22: Robert Perry on Revoking of Avodart Commercial 37
Figure 23: FDA on Presentation of the Product Information in Advertisements 39
Figure 24: CPM (Cost-per-Thousand) for Different Advertising Media, the US, US$, 2008 40
Figure 25: Alexander Capron, Professor at University of Southern California, on Criticism of Pharma Companies for their DTC Tactics 41
Figure 26: William Burns, from Roche, on Reputation Damage to Pharma Companies due to DTC Advertising 41
Figure 27: Changing Role of Television 43
Figure 28: Difference Between the US DTC Strategy and Europe DTC Strategy 47
Figure 29: Viagra Worldwide Sales, $m, 1998-2008 49
Figure 30: Detrusitol/Detrol Worldwide Sales, $m, 2003-2008 50
Figure 31: Xenical Worldwide Sales, $m, 1999-2008 51
Figure 32: Sheila McKechnie on BMJ’s Decision to Allow Branded Advertising on its Website, 1999 53
Figure 33: Nathalie Thijssens, Digital Marketing Manager, Janssen, on the objective of Psychiatry24X7 54
Figure 34: Gunter Verheugen, VP - European Commission, on Providing Bigger Role to Pharmaceutical Industry in Information Provision to Consumers 56
Figure 35: Royal Pharmaceutical Society of Great Britain on EU Proposal to Allow Restricted Branded DTC Advertising 56
Figure 36: Direct-to-Customer Advertising v/s Direct-to-Patient Advertising 60
Figure 37: Framework to Measure the Effectiveness of a DTC Campaign 62
Figure 38: Future Trends - DTC Advertising 65
Figure 39: Integrated DTC Advertising Strategies - A New Paradigm for Pharmaceutical Industry in the Future 67

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