The Effects of Pharmaceutical Marketing and Promotion on Adverse Drug Events and Regulation

American Economic Journal: Economic Policy 2 (November 2010): 1-25

Posted: 15 Mar 2015

See all articles by Seth Richards-Shubik

Seth Richards-Shubik

Lehigh University - Department of Economics; National Bureau of Economic Research (NBER)

Guy David

The Wharton School, University of Pennsylvania - Health Care Management

Sara Markowitz

Emory University; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: Noverber 1, 2010

Abstract

This paper analyzes the relationship between postmarketing promotional activity and reporting of adverse drug reactions (ADRs) by modeling the interaction between a regulator (the FDA) and a pharmaceutical firm. Promotion-driven market expansions enhance profitability yet may involve the risk of inappropriate drug prescriptions, leading to regulatory actions against the firm. We empirically test the relationship between drug promotion and reporting of ADRs using an innovative combination of commercial data on pharmaceutical promotion and FDA data on regulatory interventions and ADRs. We provide some evidence that increased levels of promotion and advertising lead to increased reporting of ADRs for certain conditions

JEL Classification: L51, L65, M31, M37

Suggested Citation

Richards-Shubik, Seth and David, Guy and Markowitz, Sara, The Effects of Pharmaceutical Marketing and Promotion on Adverse Drug Events and Regulation (Noverber 1, 2010). American Economic Journal: Economic Policy 2 (November 2010): 1-25, Available at SSRN: https://ssrn.com/abstract=2577884

Seth Richards-Shubik (Contact Author)

Lehigh University - Department of Economics ( email )

620 Taylor Street
Bethlehem, PA 18015
United States

HOME PAGE: http://www.lehigh.edu/~ser315

National Bureau of Economic Research (NBER) ( email )

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Guy David

The Wharton School, University of Pennsylvania - Health Care Management ( email )

3641 Locust Walk
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United States

HOME PAGE: http://www.wharton.upenn.edu/faculty/david.html

Sara Markowitz

Emory University ( email )

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Atlanta, GA 30322
United States

National Bureau of Economic Research (NBER)

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