US drug company marketing costs 2x their R&D

[CmdrWilkens]

People who don't live in or near the US might not appreciate how inescapable those pharmaceutical ads are. The TV is literally inundated with them. There are large billboards all over the place. You can't escape it, and that's got to cost a lot of money.

Those billboards, on a per board basis, go for anywhere from roughly $1000 to $2500 per month, newspaper ads run similair to run full page on weekday issues. All you have to do is start multiplying that out by the thousands of billboards, hundreds of newspapers (and the 365 days in the year) and that's before one gets to TV where the drug companies are one of the few groups able to afford SuperBowl ads which run upwards $2million for 30 sec.

[Flagg]

People who don't live in or near the US might not appreciate how inescapable those pharmaceutical ads are. The TV is literally inundated with them. There are large billboards all over the place. You can't escape it, and that's got to cost a lot of money.

So they don't allow RX ads on TV in Soviet Canukistan?

[Aaron]

So they don't allow RX ads on TV in Soviet Canukistan?

Here is a Macleans article dealing with that subject:

CanWest's suit against the attorney general of Canada casts the country's Food and Drugs Act as the villain. The act forbids direct-to-consumer advertising(DTCA)that ties a prescription drug to a treatment, cure or disease.(It is illegal for CanWest to, for instance, run an ad to promote Viagra for impotence, but quite legal to separately publicize the brand, or the condition; there are no such restrictions on ads that target physicians exclusively in, say, trade journals.)In a sworn statement, Arturo Duran, a CanWest MediaWorks president, claims permitting DTCA in Canada would educate the public about drug risks and benefits. "There is no evidence to justify a ban on truthful advertising of prescription drugs," Duran says.

If there are drug ads on Canadian channels, there so few that I haven't noticed. I only watch three channels though.

[Darth Wong]

People who don't live in or near the US might not appreciate how inescapable those pharmaceutical ads are. The TV is literally inundated with them. There are large billboards all over the place. You can't escape it, and that's got to cost a lot of money.

So they don't allow RX ads on TV in Soviet Canukistan?

Sure they do, although they aren't as massively saturated as the American market. It's just shocking to visit America and watch their TV and see how many drug ads there are.

[HemlockGrey]

It's just shocking to visit America and watch their TV and see how many drug ads there are.

You know what'll make you feel better about this? Some Percocet!

[Admiral Valdemar]

American TV in general is the most rank godawful shite. I hardly stomach the TV over this side of the pond as it is. It should be taken like one would take doses of highly energetic radiation: infrequently and with a lot of protection.

[Broomstick]

As far as I'm concerned, TV ads are why we have a mute button on the remote

[Natorgator]

So what? Given the fact drugs can take two decades to come to market and make the companies any money whatsoever (if they do at all, the FDA can blacklist something at any time), them promoting what they've already spent billions of dollars on isn't that surprising.

Obviously, you've been sleeping through the last decade of health-care debates, where the big pharmaceutical companies claimed that exorbitant drug costs were the inevitable result of sky-high R&D spending. The POINT which you are apparently too fucking dense to grasp is that this was all a lie. For every dollar they were spending on R&D, they were spending two dollars on marketing, and telling everyone that their exorbitant drug costs were paying for future research.

Just to start, I have the same opinions about US healthcare as most everyone here: I am not tharkun. But prices not withstanding, it costs a fucking shit-ton of money to bring drugs to market. It costs $802 million to bring a drug to market, and the average time is 7.5 years. And that's just if it's actually approved, which many times it is not. I'm not saying that pharmaceutical companies are saints, but from a business standpoint, if I'm spending almost a billion dollars on something that might make me money eight years from now, you better fucking believe I am going to advertise the everloving shit out of it.

[Spyder]

Just to start, I have the same opinions about US healthcare as most everyone here: I am not tharkun. But prices not withstanding, it costs a fucking shit-ton of money to bring drugs to market. It costs $802 million to bring a drug to market, and the average time is 7.5 years. And that's just if it's actually approved, which many times it is not. I'm not saying that pharmaceutical companies are saints, but from a business standpoint, if I'm spending almost a billion dollars on something that might make me money eight years from now, you better fucking believe I am going to advertise the everloving shit out of it.

If your drug actually does what it's meant to do you wouldn't need to market the everloving shit out of it. If doctors aren't prescribing your drug then you've fucked up. Also, the fact that your primary concern would be return on investment, thus you need a marketing blitz, thus you need to drive prices up for your medication is a strong argument that pharmaceutical research and manufacture shouldn't be privatised.

[Flagg]

People who don't live in or near the US might not appreciate how inescapable those pharmaceutical ads are. The TV is literally inundated with them. There are large billboards all over the place. You can't escape it, and that's got to cost a lot of money.

So they don't allow RX ads on TV in Soviet Canukistan?

Sure they do, although they aren't as massively saturated as the American market. It's just shocking to visit America and watch their TV and see how many drug ads there are.

Ahh, ok. I wasn't sure. I remember when the FCC lifted the ban on advertising RX drugs in '96 or '97 IIRC, and there were suddenly as many commercials for drugs as there were for cars, if not more.

I don't think TV advertising for prescription drugs should be allowed at all. The pharma companies can fill the doctors in on the new product, and the doctors can prescribe it as they see fit. You know, the way things should work in a sane world.

[mr friendly guy]

Over here the television adds I see are only for non prescription over the counter type drugs, eg paracetamol (acinetomenophen ? sp in North America) and some anti-inflammatories. These drugs are usually for minor stuff. Good thing for us all other medications have to be prescribed by doctors.

[Natorgator]

Just to start, I have the same opinions about US healthcare as most everyone here: I am not tharkun. But prices not withstanding, it costs a fucking shit-ton of money to bring drugs to market. It costs $802 million to bring a drug to market, and the average time is 7.5 years. And that's just if it's actually approved, which many times it is not. I'm not saying that pharmaceutical companies are saints, but from a business standpoint, if I'm spending almost a billion dollars on something that might make me money eight years from now, you better fucking believe I am going to advertise the everloving shit out of it.

If your drug actually does what it's meant to do you wouldn't need to market the everloving shit out of it.

And if it does work why take chances? Presumably, if it makes it to market and it's approved by the FDA, it does work.

If doctors aren't prescribing your drug then you've fucked up.

Yeah, by not telling them about it. Which I would presume is included in the marketing costs. There are huge amounts of risk involved with the pharmaceutical business, and I have no doubt they want to mitigate these risks as much as possible.

Also, the fact that your primary concern would be return on investment, thus you need a marketing blitz, thus you need to drive prices up for your medication is a strong argument that pharmaceutical research and manufacture shouldn't be privatised.

I think government is better suited than the private market for various things such as infrastructure, but inventing new drugs from scratch isn't one of them. Government is hardly suited for such types of innovation, and I think a profit motive is pretty powerful in this case. But that is merely my opinion.

[Spyder]

Just to start, I have the same opinions about US healthcare as most everyone here: I am not tharkun. But prices not withstanding, it costs a fucking shit-ton of money to bring drugs to market. It costs $802 million to bring a drug to market, and the average time is 7.5 years. And that's just if it's actually approved, which many times it is not. I'm not saying that pharmaceutical companies are saints, but from a business standpoint, if I'm spending almost a billion dollars on something that might make me money eight years from now, you better fucking believe I am going to advertise the everloving shit out of it.

If your drug actually does what it's meant to do you wouldn't need to market the everloving shit out of it.

And if it does work why take chances? Presumably, if it makes it to market and it's approved by the FDA, it does work.

To a degree.

If doctors aren't prescribing your drug then you've fucked up.

Yeah, by not telling them about it. Which I would presume is included in the marketing costs. There are huge amounts of risk involved with the pharmaceutical business, and I have no doubt they want to mitigate these risks as much as possible.

How many doctors do you know driving around looking at billboards or watch adds for prescription drugs and say "hey, that drug looks fucking awesome, I should start prescribing it!" Doctors (real ones) get their information from medical journals. If your drug isn't being prescribed it's because someone's had a look at the results of the clinical trials and decided that they're not worth it, in which case no one should be buying the drugs anyway. The mass marketing is solely to create demand among consumers who aren't qualified to decide one way or the other.

Also, the fact that your primary concern would be return on investment, thus you need a marketing blitz, thus you need to drive prices up for your medication is a strong argument that pharmaceutical research and manufacture shouldn't be privatised.

I think government is better suited than the private market for various things such as infrastructure, but inventing new drugs from scratch isn't one of them. Government is hardly suited for such types of innovation, and I think a profit motive is pretty powerful in this case. But that is merely my opinion.

Well, given that drugs produced in government labs would require zero marketing and drug companies spend twice on marketing as they do on R&D, the government could spend up to 3 times the amount on R&D for the same result and still come out more efficient.

[brianeyci]

I wonder what people like Natorgator think government research is.

It isn't a communistic plethora of hundreds of labs controlled by a central authority with poor efficiency and poor motivation. It's the government writing cheques to universities or colleges. They aren't motivated by greed, but it doesn't fucking matter, because they're motivated by just as powerful needs: glory, prestige, reputation, Nobel Prize. This is arguably a far more powerful motivator than profit, which requires immediate results. An academic funded by the government could toil for forty years to come up to a cure for a disease, while shareholders will not tolerate losses for even a quarter of a year before dumping a company's stock.

I'm tired of people saying anything with even a smidgen of government oversight needs to be inefficient. Even if it's just the government writing blank cheques to people who are highly motivated, it frees them from the concern of profit which is a huge overhead, or even the rat race of daily survival.

[K. A. Pital]

...inventing new drugs from scratch isn't one of them. Government is hardly suited for such types of innovation, and I think a profit motive is pretty powerful in this case. But that is merely my opinion.

New drugs are developed by scientists, who can be paid by the government as well as by corporations; the scientists are motivated by the pay and the prestige, the idealism of the job if you wish, much like doctors or other public servants - they're not out there to gather cashtons of profit, you know, but rather to make people healthier with new medicines, and to make said medicine widespread and acceptable is the role of the government, you know.

Too bad the theory about "government is hardly suited for such types of innovation" doesn't hold water at all: look at the history of modern medicine to see that most important "new drugs from scratch", including whole types of pharmacology like vaccines, antibiotics (inc. penicillins), were developed by state-hired researchers, loners or teams of highly skilled medical specialists.

[Darth Wong]

I love the way mindless free-market assholes state the universally superior performance of the free market as a universally accepted fact, rather than having to justify it. Of course, life can't be so complicated that you have to look at such things on a case-by-case basis, can it? Oh no, you can just make a blanket statement that government is always more inefficient than the free market, and ignore any examples that run contrary to that axiom.

[Natorgator]

I love the way mindless free-market assholes state the universally superior performance of the free market as a universally accepted fact, rather than having to justify it. Of course, life can't be so complicated that you have to look at such things on a case-by-case basis, can it? Oh no, you can just make a blanket statement that government is always more inefficient than the free market, and ignore any examples that run contrary to that axiom.

So does anyone actually have any examples of government-run pharmaceutical companies that are more successful than the ones in the US? There's a reason why the United States is at the forefront of medical technology in the world; it's because the companies responsible are making obscene profits.

From wikipedia:

As in physics and chemistry, Americans have dominated the Nobel Prize for physiology or medicine since World War II. The private sector has been the focal point for biomedical research in the United States, and has played a key role in this achievement. As of 2000, for-profit industry funded 57%, non-profit private organizations such as the Howard Hughes Medical Institute funded 7%, and the tax-funded National Institutes of Health funded 36% of medical research in the U.S. However, by 2003, the NIH funded only 28% of medical research funding; funding by private industry increased 102% from 1994 to 2003.

I'll concede that government can actually innovate, but I think it's pretty obvious that the private market will do it better.

[Darth Wong]

So does anyone actually have any examples of government-run pharmaceutical companies that are more successful than the ones in the US? There's a reason why the United States is at the forefront of medical technology in the world; it's because the companies responsible are making obscene profits.

Actually, the US does not lead the world in medical R&D spending as a function of the size of the market. Several countries in Europe beat it on that score. Ignoring the fact that the US is also a huge market with 300 million people is the kind of dishonesty and/or abject stupidity that I've come to expect from mindless apologists, though. Thanks for being ... typical.

[brianeyci]

I've never seen someone twist statistics so much.

Sixty percent of the money comes from profit, so profit is better than non-profit? Money from Bill is the same as money from Stark is the same as money from Mike. But noooooo, when people say the government could use three times the money of profits with zero advertising, somehow government money isn't worth as much as private money . A dollar from the goverrnment magically turns into less than a dollar from revenue? . The government could be three times less efficient and still break even!

Not to mention your own craptastic link says forty percent is from non-profits and the non-profit research could have a disproportionate medical value.

[K. A. Pital]

So does anyone actually have any examples of government-run pharmaceutical companies that are more successful than the ones in the US?

Define "success", asshole. Government institutions have created the most needed, innovative and revolutionary medicines, including vaccines and antibiotics. Is that not enough a "success"? You claimed the government sucks at creating new drugs, e.g. invention, not that it sucks at making profits - which isn't the case here. So you now back down from your totally shot-down claim, but install a new one - "success", which is presumably measured in financial terms, and doesn't really relate to innovation in a meaningful sense.

Talk about shifting goalposts, yeah.

There's a reason why the United States is at the forefront of medical technology in the world; it's because the companies responsible are making obscene profits.

Really? Did the US corporations invent antibiotics? Vaccines? Anything which created the modern medicine industry? No? Then probably your claim requires verification, doesn't it?

And then, the fact that the US industry is simply massive as is it's market, and situated around the private sector, doesn't prove that the US government could not put the same amount of money to work in the medical industry. Moron.

[Spyder]

So does anyone actually have any examples of government-run pharmaceutical companies that are more successful than the ones in the US? There's a reason why the United States is at the forefront of medical technology in the world; it's because the companies responsible are making obscene profits.

From wikipedia:

As in physics and chemistry, Americans have dominated the Nobel Prize for physiology or medicine since World War II. The private sector has been the focal point for biomedical research in the United States, and has played a key role in this achievement. As of 2000, for-profit industry funded 57%, non-profit private organizations such as the Howard Hughes Medical Institute funded 7%, and the tax-funded National Institutes of Health funded 36% of medical research in the U.S. However, by 2003, the NIH funded only 28% of medical research funding; funding by private industry increased 102% from 1994 to 2003.

I'll concede that government can actually innovate, but I think it's pretty obvious that the private market will do it better.

How the flying fuck is your government's failure to fund a significant portion of medical research an indicator of the performance of government funded research as a whole?

I'll say this again, with marketing costs being 2x R&D, anything up to 3x the funding for a government programme that will produce the same result will result in a net gain. So unless you can prove that taking all the scientists, engineers, researchers and all their equipment, and putting them to work under the exact same conditions under a government contract would some how, magically, make them more then 3 times as inefficient, then no it's safe to say the private market is not doing it better.

PS: I like your avatar. It's exactly what I think of when people try to defend the concept of the efficient "free-market."

[Napoleon the Clown]

Natorgator: Shut the fuck up. DARPA (it's government run, to clue you in) is currently working on various medical related research. That's the government doing what you're saying the private sector does better. And yet DARPA has made better advances in it's projects than the private sector. Having a budget that dwarfs many nations' GDPs kinda does that. The government itself isn't doing the innovations. It's providing the money.

Or we can take Universities. The University of Utah, for example, receives government funding. Out of it came the first artificial heart to keep the recipient alive for any real amount of time. Hell, it's one of the best places to go for medical research or a medical education. Just look up the biggest medical advancements. I'd imagine most of them involved government funding. Because that's where the money is. Or are you saying that an economic superpower is unable to fund medical research, despite the fact that the private sector as a whole makes up a minuscule fraction of the nation's economy? Wake up. Free-market does well with some things, others it doesn't. Medicine is too money intensive for free-market to be fully effective.

Pharmaceutical companies in the US are successful because they pull in an obscene amount of money. The US government is far bigger and far richer than all of these companies put together. And, as demonstrated by the amount of money spent on advertising, the pharmaceutical companies aren't spending money any more efficiently than the government would.


As to the OP: I didn't know it was that badly out of proportion, nor did I ever really think about it. Though I am honestly not surprised. Disgusted, most certainly.

[CmdrWilkens]

Add to the list The National Study Center for Trauma and Emergency Medical Systems, which is part of the rather famous 'Shock Trauma" center in Baltimore. Its a federally organized research arm into trauma prevention and care which has been operating since 1986 and which is colocated with the Maryland Institute of Emergency Medical Services. So simply put THE foremost trauma treatment and prevention center in the world is funded principally through the efforts of the federal government and the state of Maryland. I'd rather say that you can attribute a percentage of every advance in American emergency medicine back to this group.

[Broomstick]

Not to mention military medicine which is ENTIRELY funded by the Federal government in the US, and likewise governmentally funded everywhere else. Military medical personnel founded and refined reconstructive surgery, developed new ways to preserve and transport things like blood, mass production of things such as antibiotics and IVs, has always been in the forefront of emergency and trauma medicine, brought us such novelties as the air-evac ambulance... all of these items were rapidly brought to civilian medicine in peace time applications (such as trauma centers) as well as used in war. Right now the US government is providing funding to researchers for better prosthetic limbs (one goal is an artificial hand dexterous enough to play simple tunes on a piano) which will also benefit civilian amputees.