The Shape of Demand: What Does It Tell Us about Direct-to-Consumer Marketing of Antidepressants?
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Chad D. Meyerhoefer
Abstract
Much of the debate surrounding Direct-to-Consumer Advertising (DTCA) of pharmaceuticals centers on whether DTCA conveys useful information to consumers or indiscriminately increases requests for the advertised medication. By identifying how DTCA changes the shape of the demand curve for antidepressants, we seek to infer the promotional objectives of manufacturers. Using data from the 1996-2003 Medical Expenditure Panel Survey (MEPS), we find that advertising shifts the demand curve for antidepressants outward and rotates it counter-clockwise. DTCA increases the probability that an individual will initiate use of antidepressants, particularly when out-of-pocket medication costs are low, but does not necessarily increase utilization levels among those already taking antidepressants. This is consistent with a promotional campaign that seeks to alert consumers to the product's existence, but conveys no real information that would allow them to learn their true match with the product.
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston
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Articles in the same Issue
- Advances Article
- How Did SCHIP Affect the Insurance Coverage of Immigrant Children?
- The Shape of Demand: What Does It Tell Us about Direct-to-Consumer Marketing of Antidepressants?
- Stemming the Tide? The Effect of Expanding Medicaid Eligibility On Health Insurance Coverage
- Health Care Economics and Policy: An Introduction
- Contributions Article
- Sequential Patterns of Drug Use Initiation - Can We Believe In the Gateway Theory?
- The Effect of the Consolidated Omnibus Reconciliation Act of 1985 on Health Care Utilization of Employment Separators
- Did 'Targets and Terror' Reduce Waiting Times in England for Hospital Care?
- Mitigating the Problem of Unmeasured Outcomes in Quality Reports
- Advertising, Free-Riding, and Price Differences in the Market for Prescription Drugs
- Patient Welfare under the Legal Standard of Care
