Healthy Skepticism Library item: 4848

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: Journal Article

Windmeijer F, de Laat E, Douven R, Mot E.
Pharmaceutical promotion and GP prescription behaviour.
Health Econ 2006 Jan; 15:(1):5-18
http://www3.interscience.wiley.com/cgi-bin/abstract/110504860/ABSTRACT

Abstract:

The aim of this paper is to empirically analyse the responses by general practitioners to promotional activities for ethical drugs by pharmaceutical companies. Promotion can be beneficial as a means of providing information, but it can also be harmful in the sense that it lowers price sensitivity of doctors and it merely is a means of maintaining market share, even when cheaper, therapeutically equivalent drugs are available. A model is estimated that includes interactions of promotion expenditures and prices and that explicitly exploits the panel structure of the data, allowing for drug specific effects and dynamic adjustments, or habit persistence. The data used are aggregate monthly GP prescriptions per drug together with monthly outlays on drug promotion for the period 1994-1999 for 11 therapeutic markets, covering more than half of the total prescription drug market in the Netherlands. Identification of price effects is aided by the introduction of the Pharmaceutical Prices Act, which established that Dutch drugs prices became a weighted average of the prices in surrounding countries after June 1996. We conclude that GP drug price sensitivity is small, but adversely affected by promotion. Ltd. Copyright © 2005 John Wiley & Sons, Ltd.

Keywords:
Drug Costs/statistics & numerical data Drug Industry/economics* Drug Utilization/economics* Drug Utilization/statistics & numerical data Drugs, Generic/economics Education, Medical, Continuing Family Practice/economics Family Practice/education Family Practice/statistics & numerical data* Fees, Pharmaceutical/statistics & numerical data Humans Marketing/economics Marketing/methods* Models, Econometric Netherlands Physician's Practice Patterns/economics* Physician's Practice Patterns/statistics & numerical data Physicians, Family/economics* Physicians, Family/psychology Prescriptions, Drug/economics* Research Support, Non-U.S. Gov't Training Support