Sick of TV Drug Ads? Here’s Why They Might Be Good for You

Advertisements for branded, patented pharmaceutical drugs often have effects that go beyond providing information to patients. The ads are also about “business-stealing,” i.e. convincing consumers to buy one firm’s drug over that of a rival. In a positive spillover, the ads also encourage patients to visit their doctors to check on different medical conditions, but potentially drive them to cheaper, generic equivalents of the branded drugs that are advertised.

Those are the findings of a recent research study conducted by Wharton’s Michael Sinkinson, a professor of business economics and public policy and Amanda Starc, a professor of health care management. Their research paper, titled “Ask Your Doctor? Direct-to-Consumer Advertising of Pharmaceuticals,” is unique in separating the business-stealing effect from the informational effect of the ads.

Sinkinson recently discussed the research with Knowledge@Wharton. More: http://knlg.net/1g7ZDzU