Retail prescriptions of blockbuster drugs, promotions drop

PLYMOUTH MEETING, Pa. Drug manufacturers have toned down their spending to promote blockbuster drugs as retail prescriptions, and the number of blockbuster brands decreased, according to a report by healthcare analysis firm SDI.

Retail prescriptions grew by 2.7% last year, compared with 4.5% the year before. Generic drugs accounted for overall growth, with 11% in prescription increases in 2008 and 12% in 2007. Branded drug prescriptions, by contrast, decreased by 10% in 2008 and 5% in 2007. The period also saw a decrease in the number of blockbuster drug brands, defined by sales of $1 billion per year, from 38 in 2007 to 34 in 2008.

Consequently, according to SDI, promotional spending for blockbuster drugs has also decreased. Between 2004 and 2008, spending on promotions grew by 2% a year, but grew by 1% in 2008. Direct-to-consumer advertising saw the biggest decrease, dropping by 4% in 2007 and by 8% in 2008. The effect was especially pronounced among drugs for cholesterol, gastroesophageal reflux disease, depression and hypertension, which have experienced declines and generic competition, thereby seeing a decrease in spending on DTC advertising from 39% in 2007 to 47% in 2008.

“In our industry, manufacturers’ promotional efforts are being increasingly scrutinized internally from a budgetary and return-on-investment perspective, as well as externally on the regulatory front,” SDI COO John Ross said. “Evidence of the changes under way in promotional efforts can be seen in sales representative reductions, growing emphasis on online marketing, continued outsourcing and the deployment of new segmentation and targeting schemes that reflect the transformation that the industry is undergoing.”