Drug makers spend more on marketing than research: study

Last Updated: Thursday, January 3, 2008 | 10:15 AM ET

CBC News

U.S. drug companies spend almost twice as much on marketing and promoting medications than on research and development, a new Canadian study says.

"These numbers clearly show how promotion predominates over R&D in the pharmaceutical industry, contrary to the industry's claim," the authors write in this week's peer-reviewed journal Public Library of Science Medicine.

Using data from two market research companies, the University of Quebec's Marc-André Gagnon and York University's Joel Lexchin found U.S. drug companies spent $57.5 billion US on promotional activities in 2004 compared with $31.5 billion on research and development.

Promotional activities included free samples, visits from drug reps, direct-to-consumer advertising of drugs, meetings with doctors to promote products, e-mail promotions, direct mail and clinical trials designed to promote the prescribing of new drugs rather than to generate scientific data.

The authors say their figure of $57.5 billion US is likely an underestimate, citing other avenues for promotion such as ghostwriting of articles in medical journals by drug company employees, or the off-label promotion of drugs.

Drug companies have long argued they are driven primarily by research, while critics charge that marketing and profits are their primary concerns.

It's not a surprising conclusion, said Steve Morgan, an expert on the economics of the pharmaceutical industry at the University of British Columbia.

"It's been known for a long time that manufacturers of prescription drugs spend more money on marketing than they do on research and development," added Morgan, who heads the program in pharmaceutical policy at the university's Centre for Health Services and Policy Research.

There were extensive U.S. government reviews of the pharmacy business in the 1950s and '60s and again in the 1980s. But there hasn't been a comprehensive study of drug industry profits and spending in more than a decade.