1. Medical Products & DTC Advertising 101 Thomas Hazlet, PhPH, PharmD

2. Agenda Theoretical basis for advertising Policy analysis perspective Regulatory history

3. Agenda Theoretical basis for advertising Policy analysis perspective Regulatory history

4. Advertising basics Free market model – Voluntary exchanges (including information)‏ – Supply & demand  “efficient” distribution – Welfare maximizing Market failures – Information search costs & “agency” responsibilities – Barriers to entry & monopolies – “Theft” & intellectual property Role of Advertising – competing views – Reduce search costs by reducing information asymmetry – “Artificial” product differentiation  informational confusion; increase consumption through information asymmetry

5. More basics Best avenue for dissemination of “useful” information – Organizational vetting – i.e., Kaiser, GHC – NICE-like “independent” evaluators – Part of the regulatory process – Off-label utilization

6. Agenda Theoretical basis for advertising Policy analysis perspective Regulatory history

7. Policy Issues & Medical Product Ads DTC in US vs. other countries – Justification First Amendment “free speech” issues FD&C Act protections requiring “truth” and “fair balance” DDMAC, other, activities – “Warning Letters”; disgorgement Current legislation to increase DDMAC funding outside of PDUFA IV – Objections – Other countries Product development cycles – Big (>$1b) risks and frequent failures – Dissemination of information – reducing those search costs – Entry barrier NDA, BLA, 510(k)|PMA clinical development Patent structure protects IP  monopoly

8. Nature Biotechnology 22, 817 - 822 (2004)

9. Alternatives Prohibition of DTC Other avenues for product information dissemination Vigilance by FDA / FTC (funding)‏ – Increased throughput at DDMAC – Pre-screening

10. http://www.ama- assn.org/ama/pub/category/12054.html#1 http://www.ama- assn.org/ama/pub/category/12054.html#1

11. Agenda Theoretical basis for advertising Policy analysis perspective Regulatory history

12. … US History 1820  USP (& NF)‏ 1848 importation bans on adulterated drugs 1900’s – Sinclair’s Jungle; Collier’s “The Great American Fraud”; F&D Act – truthful labeling (except to physicians); courts vs. congress re false therapeutic claims; Harrison Act (narcotic control)‏ 1930’s – Revision of F&D Act – 5 year legislative battle culminating in the 1938 FD&C Act following the elixir of sulfanilamide