Big Pharma’s DTC Advertising Is Costing American Taxpayers BILLIONS

Big Pharma Continues To Pad Their Bottom Line With Direct-to-Consumer (DTC) Advertising, Costing U.S. Taxpayers Billions Of Dollars

Big Pharma’s staggering spending on advertising directly targets consumers and the scale of their tax benefits from writing off these marketing strategies increase prescription drug prices for the American people. Cracking down on Big Pharma’s DTC advertising could save the American people more than one billion dollars. 

Examples of Big Pharma’s money grab:

• Big Pharma spent nearly $14 billion on DTC advertising in a single year. 
• American taxpayers lose more than one billion each year in tax revenue, as pharmaceutical companies write off marketing expenses to further pad their bottom line. 
• Taxing or prohibiting DTC ads for the ten largest pharmaceutical companies in the U.S. would result in increased federal tax revenue between $1.5 and $1.7 billion per year. 
• The U.S. is one of only two countries in the world that allow DTC advertising for pharmaceuticals.
• DTC advertising can lead to the overutilization of expensive, older meds. A 2023 Forbes column highlights, DTC advertising can contribute to “the (over)use of higher-cost drugs over generics and less expensive alternatives,” which can lead to increased spending on prescription pharmaceuticals.
• JAMA Network research paper from January 2023 found that advertising spending on drugs considered having “high therapeutic value” accounts for fewer than one-third of all DTC pharmaceutical advertisements.
• An October 2021 study from America’s Health Insurance Plans (AHIP) found that seven of 10 of the largest pharmaceutical companies by revenue spent more on sales and marketing in 2020 than R&D.

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