Prescription Prices and Direct to Consumer Advertising

描述(由申请人提供)：本提案中概述的经验性工作旨在评估处方药直接面向消费者(DTC)广告对处方药价格的影响。1997年，联邦贸易委员会放宽了对DTC广告的管理规则，导致DTC广告大幅增加。最近，DTC广告成为了一个有争议的全国性问题。对DTC广告的任何评估都应该考虑到对其收益和对消费者的成本的估计。对消费者的好处是健康信息。消费者的代价是更高的药品价格。然而，没有关于DTC广告增加对处方药价格影响的实证估计。这项建议的主要目的是通过估计药品价格和支出的增加可以归因于广告增加的比例来告知DTC广告的成本。广告可以包括在处方药的需求中，因为它可以增加消费的边际效用。广告还可以通过转移需求或降低需求的价格弹性来提高价格。如果广告使产品与众不同，并降低了人们对替代品的看法，那么需求对价格的反应就会变得不那么敏感。根据勒纳规则，更缺乏弹性的需求曲线将导致更高的价格，其他条件相同。该数据集将每月收集四个治疗类别的所有可用药物：1)关节炎、2)高胆固醇、3)溃疡和4)失眠。之所以选择这些治疗类别，是因为它们包括一种或多种DTCA支出相对较高的药物，以及其他很少或没有DTCA的药物。评估将分别针对每个治疗类别进行。两个价格变量和来自电视、广播和杂志的广告数据将被收集。促销支出和销售之间的内生性是一个令人担忧的问题。评估一致性效应的主要方法将利用FDA政策变化导致的DTCA的外生变化。这一自然实验类似于对不同时间和每类药物的各种其他对照进行的事前比较条件。由于可以在两个方案中观察该公司，一个方案限制DTCA，另一个方案不限制，这允许在一段时间内将DTCA较低的一组药物与DTCA较高的一组药物进行外源比较。将模拟DTCA对药品价格和广告药品销售增加的影响。这将在每个治疗班进行。我们将模拟三种可供选择的DTCA场景。

DESCRIPTION (Provided by applicant): The empirical work outlined in this proposal is designed to estimate the effects of direct to consumer (DTC) advertising of prescription drugs on the price of prescription drugs. In 1997, the Federal Trade Commission relaxed the rules governing DTC advertising, which resulted in a substantial increase in DTC advertising. Recently, DTC advertising has become a controversial national issue. Any evaluation of DTC advertising should take into account estimates of both its benefits and its costs to consumers. The benefits to consumers are health information. The costs to consumers are higher drug prices. However, there are no empirical estimates of the effect of the increased DTC advertising on prescription drug prices. The primary purpose of this proposal is to inform on the cost of DTC advertising by estimating what fraction of the increase in drug prices and spending can be attributed to the increased advertising. Advertising can be included in the demand for prescription drugs since it can increase the marginal utility of consumption. Advertising can also increase price by shifting demand or by decreasing the price elasticity of demand. If advertising differentiates the product and reduces the perception that substitutes are available, then demand becomes less price responsive. According to the Lerner rule, a more inelastic demand curve will result in a higher price, ceteris paribus. The data set will a monthly pool of all the available drugs in four therapeutic classes: 1) arthritis, 2) high cholesterol, 3) ulcers and 4) insomnia. These therapeutic classes were chosen since they include one or more drugs with relatively high levels of DTCA spending and other drugs with little or no DTCA. The estimation will be done separately for each therapeutic class. Two price variables and advertising data from television, radio and magazines will be collected. Endogeneity between promotional expenditures and sales is a concern. The primary approach to estimating consistent effects will make use of the exogenous shift in DTCA resulting from the FDA's policy change. This natural experiment is akin to a pre-post comparison conditioning on various other controls over time and across drugs in each class. Since the firm can be observed in two regimes, one where DTCA is restricted and one where it is not, this allows an exogenous comparison of a group of drugs with lower DTCA with a group of drugs with higher DTCA within a therapeutic class over time. A simulation of the effect of DTCA on drug prices and on increased sales of advertised drugs will be performed. This will be carried out for each therapeutic class. Three alternative DTCA scenarios will be simulated.