Won’t signing the pledge harm the pharmaceutical industry, which provides important new drugs and employment opportunities?

The pharmaceutical industry makes double digit percentage profits. They are some of the most profitable organisations on earth. We aren’t privy generally to their balance sheets, but it is widely understood they spend as much as half or more of their budget on promotion. Their advertising budgets generally outweigh their research budgets.

How they best allocate spending between the various divisions of their company is entirely – and appropriately – an internal matter, and it is conceivable that if enough doctors chose not to see drug reps, some companies may shift their allocations in response. This does not present any ethical or moral dilemma for a doctor, nor any threat to patient health or new drug research.

One of the reasons that each company feels obliged to spend so much on pharmaceutical reps is because every other company also has reps. In ‘game theory’, this is called an ‘arms race’. If everyone else’s reps are convincing their doctor-clients to switch brands, a company can’t afford to not employ reps, because of the potential loss of market share.

An article in the Harvard Journal of Law and Technology explains the background: (Wang)

[US] pharmaceutical companies spent $57.7 billion on marketing in 2004…The estimates include physicians detailing ($20.4 billion) [and] samples ($15.9 billion)…The top ten largest global pharmaceutical companies spent a total of $739 billion on “marketing and administration” between 1996 and 2005, compared to $288 billion on R&D and $43 billion on capital improvements.

Wang then explains the arms race:

The immense cost of marketing, R&D, and regulatory approval puts tremendous pressure on brands to achieve their sales goals…Marketing generates sales. Pressure to increase sales then leads to yet more marketing…This costly cycle translates into an arms race among competitors in the same disease indication or drug class…Each player is unable to unilaterally decrease the level of marketing without unilaterally shouldering the harm; therefore, no one company is willing to break the vicious cycle.

Taking this pledge could even be thought of as doing your tiny bit to help break this vicious cycle!

The article goes on to discuss regulatory ‘top down’ solutions to the arms race, but the ‘No Advertising Please’ campaign is very much an alternative from the ground up. Both solutions ideally involve across-the-board, uniform reductions, which is another reason it is important to see no reps, rather than just fewer reps.

If enough doctors in Australia took this pledge, it may indeed reduce the demand for pharmaceutical reps. The arms race would become less critical and eventually the ‘supply’ of jobs for reps might diminish. We don’t pretend to know how each company would spend the extra money saved: perhaps it might even go into drug research!

What we do know is that evidence suggests the cost of prescribing might drop and the quality of prescribing might increase (Spurling).

References