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U.S. One of Two Countries to Permit Drug Ads on TV 2015-03-31
By Bloomberg News

Pfizer's tab to keep its best- selling drugs on top and turn its newer ones into tomorrow's blockbusters? More than $1 billion.

America's biggest drugmaker led the pharmaceutical industry in advertising in 2014, boosting spending even as other corporate giants such as Procter and Gamble, Toyota Motor and L'Oreal SA cut back, according to data from Kantar Media.

Drug industry spending on consumer ads grew to $4.54 billion last year, 21% more than in 2013, according to research firm Nielsen. Pfizer led its peers by a wide margin, spending $751.9 million on TV ads, more than double second-biggest spender AbbVie. In total, it spent $1.1 billion to $1.4 billion, according to data from Nielsen and Kantar.

"When you're in a leadership position, what advertising does is it defends your brands," said marketing consultant Laura Ries, president of Ries & Ries, a brand strategy firm based in Atlanta. "Pfizer's raising that bar so that other players are less likely to be heard."

Pfizer had 7 of the top 10 most-advertised drug brands, according to data from Nielsen, with ads for erectile dysfunction drug Viagra, blood-thinner Eliquis and arthritis drug Xeljanz all in the top five. Those are among its biggest sellers, and made up $10.5 billion of Pfizer's $45.7 billion in drug sales last year.

Drugs for chronic conditions dominate the top 10, as pharmaceutical companies increasingly use TV to advertise to the baby boomer generation who are more likely to be in need of such therapies.

Legal on TV in two countries
"Older people, they're the ones watching the nightly news and it's one pharmaceutical ad after another," Mr. Ries said. "You see those few industries that really have a focus that they're not trying to reach everybody. If that tends to be an older consumer, we tend to know where they are."

The U.S. began permitting TV ads for prescription drugs in 1997 and is the only country, besides New Zealand, that allows them. Since then, direct-to-consumer ads have boomed, to $5.4 billion in 2005 from $1.2 billion in 1998, according to a 2011 study published in the journal Pharmacy & Therapeutics.

The industry's ad spending still doesn't come close on what it spends on doctors who prescribe its products. In the first five months of 2013, drug and medical device makers paid doctors and hospitals $3.5 billion in grants, fees and royalties, according to a U.S. government database. That works out to about $8 billion a year.

Pfizer declined to comment on its direct-to-consumer marketing strategy. John Mack, the publisher of Pharma Marketing News, said this isn't the first time the company has outspent its peers on direct-to-consumer advertising.

"Pfizer probably can afford it more than any other pharmaceutical company," he said, adding the drugmaker is looking to market therapies for diabetics and to people seeking to quit smoking. "TV is very good for reaching these large populations but it's very expensive, it's probably the most expensive form, so that ups the amount of dollars that are spent whereas some other pharmaceutical companies may be putting their money into other media that's not as expensive like print or internet."

Patent Pending:   60/481641
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