Drug advertising

CHOICE calls for greater scrutiny of pharmaceutical marketing, its impact on medical practice and cost pressures on the health system.
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  • Updated:11 Jul 2008

01 .Introduction

Open medicine bottle and tablets

The issue

CHOICE is concerned that some pharmaceutical companies are employing sophisticated and potentially misleading marketing strategies to increase drug sales . In particular, it is concerned that this can lead to the potential problem of ‘leakage’ (where drugs approved for one purpose is being used for another) — leading to a subsequent increase in the cost of the Pharmaceutical Benefits Scheme (PBS).

A recent CHOICE report, Pushing Pills, found that ads in magazines for doctors regularly include images of healthy, active-looking people which, in some cases, did not realistically depict the effectiveness of the medicine. These images are intended to establish an emotive connection with the viewer. It's not clear how they help doctors make decisions about the best treatment.

The report also found that 93% of ads aimed at GPs for high blood pressure medicines were for newer medicines still under patent which were not necessarily more effective than older treatments. The recommended best first-line treatment for the condition was not advertised at all and is rarely prescribed in Australia. This is despite it being cheaper than many commonly prescribed treatments.

Doctors don't only rely on company-sponsored information sources. However, pharmaceutical company-sponsored sources, including advertisements to GPs and pharmaceutical sales representatives, greatly outweigh independent sources of information.

Medicines Australia (MA), the peak body for the pharmaceutical industry, administers a Code of Conduct (the Code) on pharmaceutical marketing. The Code applies to all pharmaceutical companies in Australia, whether they are a member of MA or not. It sets the standards for the ethical marketing and promotion of prescription pharmaceutical products in Australia. Medicines Australia will review the Code in 2008.

In 2006, when the Australian Competition and Consumer Commission (ACCC) approved the latest version of the Code, ACCC Chairman Graeme Samuel concluded, "it is unclear how effective [the Code] is in actually regulating drug companies' conduct". Unfortunately, the law does not allow the competition regulator to make major changes to the Code.

CHOICE is concerned that it is a conflict of interest for the Code to be administered by the industry peak body. It is also concerned that the sanctions available in the Code do little to prevent breaches.

What we want

  • A new, independent regulator for pharmaceutical marketing, to replace the industry lobbying body Medicines Australia. It is a conflict of interest for Medicines Australia to both represent the pharmaceutical industry and police pharmaceutical promotion. The new regulator should also review and improve the Code, including increasing the range and level of sanctions.
  • More independent, easily-accessible sources of information for doctors, including independent drug detailers who visit GPs to inform them about new drugs on the market.
  • A ban on pharmaceutical promotion in doctors' prescribing software.

What we’re doing

  • Our research report, Pushing Pills, highlights concerns about advertising to doctors and calls more for independent sources of information for doctors.
  • We wrote to the Minster for Health, providing her with a copy of our report, Pushing Pills, and reiterated our concerns about pharmaceutical promotion.
  • We wrote to the former Minister for Health expressing our concern about self regulation of pharmaceutical advertising. Read his response.
  • Our paper presented to the Pharmaceutical Industry Action Agenda (PIAA) conference in November 2005 argued that advertising by pharmaceutical companies which targets doctors and consumers leads to cost pressures on the Pharmaceutical Benefits Scheme (PBS) which are passed on to consumers.
  • We wrote to the Federal Treasurer and the Minister for Health calling for a ban on pharmaceutical promotion in doctors’ prescribing software.

CHOICE's complaint to Medicines Australia.

Eli Lilly recently put out a press release which marketed an erectile drug to the public. CHOICE lodged a complaint with the industry body, Medicines Australia, about the press release. Eli Lilly was given a $60,000 fine. This is a win for consumers.

The level of the fine illustrates one of the problems with the Code of Conduct. $60,000 is equivalent to fewer than 30 men buying the drug for 12 months. For Eli Lilly the coverage generated by the media release is likely to be worth the small fine. Fines like this do little to discourage breaches of the Code.

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The Issue

A joint Australian and New Zealand regulatory agency for therapeutics will be established in 2008. This agency will be named the Australia New Zealand Therapeutic Products Authority.

One of the key issues to be agreed is drug advertising rules under the new agency.


The Interim Advertising Council released a report in October 2004 entitled the 'Proposed Trans-Tasman Model for the Regulation of the Advertising of Therapeutic Products'. The report proposes a new model for the regulation of advertising under the new joint agency. The report was approved with small changes in December 2005 by the Therapeutic Products Interim Ministerial Council.

The Draft Rule on Advertising outlines how the new model for the regulation of advertising is to be implemented.

What we want

  • The prohibition on direct-to-consumer-advertising (DTCA) in Australia should be retained and it should also be prohibited in New Zealand.
  • The National Medicines Policy needs to underpin any policy changes to the regulation of advertising, to ensure rational use of medicines.
  • We support the proposal for a “central mailbox” – it will simplify the complaints process and should be implemented, but it is vital that all complaints are handled and processed by this central mailbox committee and not delegated to industry bodies.
  • Sanctions should be increased to deter repeat beaches of the Code.
  • A greater focus needs to be placed on monitoring (while monitoring is mentioned as a function which both the Advertising Council and Advertising Management Subcommittee will undertake, it remains unclear how monitoring will be carried out).
  • There is a need for increased consumer participation in the governance of the structures proposed.
  • Resources need to be made available to fund a consumer education campaign about the proposed changes to the regulation of advertising. This will increase transparency and consumer confidence in the new regulatory scheme.

Update February 23, 2007: Xenical advertising banned by regulatory agency

The National Drugs and Poisons Scheduling Committee has withdrawn permission for Xenical to be advertised directly to consumers. However, it did not change Xenical's status to a S3 'pharmacist only' drug. CHOICE argues that Xenical needs to be dispensed by doctors to ensure that consumers are not paying for a product that wont work for them.

In their decision the NDPSC "noted the advice from professionals and consumers that direct-to-consumer advertising increased pressure on pharmacists to provide orlistat to consumers. This in turn had the potential to result in inappropriate patterns of use, in patients for whom orlistat was neither indicated nor appropriate."


Xenical entered the Australian market in 2000 as a prescription drug (schedule 4). In 2004 it became a ‘pharmacist drug’ (schedule 3), this means that it can be sold without a prescription.

Roche obtained advertising approval for Xenical in February 2006. The advertising started in September 2006 on the show Australian Idol.

Why this is an important issue

Advertising like this suggests that the drug could be appropriate for anyone who thinks they have a weight problem.

Changes to diet and exercise are essential to weight loss. While weight loss drugs can help some people, Xenical is appropriate only for those people with a Body Mass Index (BMI) of 30 or 27 if a person has risk factors such as high blood pressure or cholesterol. It is not suitable for those in a healthy weight range (BMI 20-25) who just want to lose a few kilograms.

What we’re doing

CHOICE made a complaint about the advertisements to the regulator (the Therapeutic Goods Advertising Code Council (TGACC) Complaints Resolution Panel) in October 2006.

Our complaint was upheld and Roche had to withdraw the ads.

We have also written to the National Drugs and Poisons Schedule Committee (NDPSC) asking that advertising approval for Roche be immediately removed and the schedule changed back to S4 (requiring a prescription).

The NDPSC called for submissions on rescheduling Orlistat as a result of our complaint. We also conducted a shadow shop to determine if the drug was being dispensed according to the Pharmaceutical Society of Australia (PSA) guidelines. We sent a young looking 19 year old girl with a BMI of 24.8 to 30 pharmacies in Sydney to see if Xenical would be dispensed to her. She does not meet the clinical profile for the drug but was dispensed the product in 24 out of 30, or 80%, of pharmacies.

We have made a submission to the NDPSC outlining our findings from the shadow shop.

CHOICE continues to campaign on this issue.

We want Xenical to be rescheduled as a prescription drug.

Read our letters to the TGACC and NDPSC.

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