AMA’s Advertising Revenue is Twice as Much As Subscription Revenue
Santa Monica, CA — A consumer group called on the American Medical Association (AMA) today to disclose the amount of advertising money that the AMA collects from drug companies in the wake of the AMA‘s announcement that it will “investigate” the impact of drug company advertising on consumers. In the June 15 issue of the Journal of the American Medical Association, 9 of the 16 full page advertisements were for pharmaceuticals, including the first six pages and the inside and back covers.
The AMA‘s announcement failed to acknowledge the fact that drug companies spent five times more on marketing to physicians, including advertising in journals, than they do on advertising to consumers.
A large body of research has found that pharmaceutical advertising and marketing to doctors has led to increased prescribing, use and possibly over-use of prescription drugs.
“The AMA‘s feigned concern for the fate of patients targeted by drug advertising makes about as much sense as a pusher enrolling his customers in drug-addicts anonymous,” said Jerry Flanagan of the Foundation for Taxpayer and Consumer Rights. “Patients and doctors have a right to know how much advertising money the AMA‘s journal receives from drug companies. Drug companies spend five times as much on marketing to doctors than they do advertising to consumers because they know their profits depend upon whether a doctor is motivated to prescribe the newest blockbuster.”
According to the AMA‘s 2003 tax return, the AMA receives two times more money in advertising dollars than it does from subscriptions. In 2003, the latest data available, the AMA received $41,123,622 from advertising revenue, compared to $17,677,540 from subscription fees. The AMA‘s advertising revenue accounts for 45% of the group’s total program revenue.
In 2000 (the latest data available) drug companies spent $4.8 billion on “physician detailing,” the practice of sending marketers to doctors’ offices to encourage doctors to prescribe a company’s drugs. In the same year, drug companies spent $2.4 billion on consumer advertising. Total physician promotional spending by drug companies in 2000 was $13.2 billion, including $484 million for journal advertising.
In 2004, Pfizer settled a lawsuit for $430 million with the U.S. Attorney General’s office that alleged that the company had promoted its anti-convulsant medication, Neurontin, to doctors for “off-label” treatments — those not approved by the FDA.
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The Foundation for Taxpayer and Consumer Rights (FTCR) is a leading nonpartisan and nonprofit consumer advocacy organization.