By
Kirsten Axelsen
June 3, 2019 at 5:00 am ET
While it is hard to imagine that prescription drug advertising can be more bewildering than it is already, the Trump administration has found a way to make it worse by requiring that the price of pharmaceutical drugs be mentioned in ads.
There is no question that people can benefit from more affordable treatments and medicines, but if the administration wants to help people make good and affordable choices about health care, there are better sources of information. And if the administration wants to embarrass drug companies, it could choose to do something that doesn’t also irritate and confuse television viewers.
Displaying drug prices in direct-to-consumer ads will neither help patients nor control wasteful health care spending. In fact, pharmaceutical drug list prices are already widely available and are meaningless to most consumers and physicians because most patients don’t pay the list price.
The actual “out-of-pocket” price depends on people’s insurance, and even that varies depending on where they live and the type of insurance plan they have. In addition, most drugs aren’t advertised to the public.
The drug prices that would be required in ads are already accessible: They can be purchased from one of a number of companies that already collects and aggregates prices, or they can be accessed for free via a multitude of websites, such as GoodRX. Furthermore, as the provider of federally and state-funded health care, the administration already collects price data, including through Medicare and the Veterans Health Administration. It would be easy for the government to share the data with the public if it wished to do so.
If the intent of this new rule is to embarrass drugmakers to get them to lower prices, it would be more efficient to post the prices on the Health and Human Services website, or on a billboard in Times Square for that matter. On a website, the administration would be able to point out the biggest price increases or compare brand-name drugs with generic equivalents, which is difficult to do on a short TV ad.
It would also be able to publicize the prices of drugs that are not advertised. Whether this would have any impact is questionable, but if it were to succeed and “shame” the pharmaceutical industry, it would be simpler, more relevant and less annoying.
In reality, most people don’t pay the list price of a drug. When they do, it is often due to health benefit designs — where co-insurance and deductibles are based on the list price of a medicine, or because they lack insurance. Should the advertising rule be implemented, the drugmaker will most likely include, in addition to the list price, supplementary information such as the average patient out-of-pocket co-pay and how to determine if you can get the pharmaceutical drug for less through a patient assistance program.
At the moment, plans to add the list price to commercials, in addition to the explanation of risks and side effects that are already required, will only add to the confusion. The finished product will be hard to digest and could become a real Super Bowl killer.
Consumers should know their options when it comes to their health care, but there are better ways to do it than putting prices in television commercials. Today, television is a decreasing source of information, while the internet grows more important for consumers.
The administration could create a user-friendly website where patients could look at specific conditions and find out the average price of medications in that therapeutic area, whether generics are available, and what would be the average out-of-pocket cost per patient. This could be done also for other commonly used services such as imaging (MRIs, CT scans and X-rays for example), surgery and physical therapy near a patient’s home. While not perfect, more than half of patients use the internet for health information, and a reliable and consistent source of health cost data would be beneficial.
Regulation of advertising should be done to benefit the physical and financial health of Americans, not to further a political fight. If the administration wants to share price information for pharmaceutical drugs with the public, then it should ensure that the data are presented in a way that will help consumers and not leave them in the dark.
Kirsten Axelsen is a visiting fellow at the American Enterprise Institute, where she focuses on domestic and international pharmaceutical policy, and she previously worked for Pfizer.
Morning Consult welcomes op-ed submissions on policy, politics and business strategy in our coverage areas. Updated submission guidelines can be found here.