Pharma ads on TV will now have to include drug prices. Will this propel a shift toward digital advertising?
Pharmaceutical prices have been steadily rising, with the cost of drugs under patent protection reaching up to tens of thousands of dollars per month.
Now the Trump administration is taking action. A new rule will require television ads to disclose the price of a medication whenever it exceeds $35. While the full implications of this policy are yet to be seen, it’s likely to accelerate the shift of pharma ads from TV to digital channels, highlighting the increasing importance of digital healthcare marketing.
New Rule Mandates Prices in TV Ads
Announced on May 8, the Department of Health and Human Services’ latest regulation requires pharma companies to include the list prices of their drugs in TV ads. The rule only applies to drugs that are covered by Medicare or Medicaid and cost over $35 per month. Much like ads already state possible side effects, they’ll now disclose the price – either monthly or for a course of treatment – in legible text at the end of the segment.
Each price announcement will be accompanied by the disclaimer that costs can be different with insurance. The rule is expected to go into effect over the summer, though it could face a court challenge from the drug industry on freedom of speech grounds.
The idea is to encourage pharma manufacturers to lower their list prices in order to benefit patients. As HHS Secretary Alex Azar put it, “We are moving from a system where people are left in the dark to a system where patients are put in the driver’s seat.”
Digital Healthcare Marketing Becomes Even More Central
The ultimate implications of this new rule are still unclear. It may actually succeed at causing drug companies to make their products more affordable. It also seems likely that the disclosure rule will escalate the trend of drug ads moving online. The digital realm has already become central to healthcare marketing, and now by shifting ads from TV to the internet, pharma companies can avoid divulging their prices.
This update underscores the fact that no medical marketing campaign is complete without a digital strategy. Online marketing has a number of key advantages over TV and other legacy media. First, its reach is much easier to measure. With print and TV, only rough estimates of how many consumers see your content are possible. Yet with digital ads, you can tell the exact number of people exposed to each ad. Moreover, with the pay-per-click model, you only pay for ads that generate engagement; the system is set up so that you aren’t charged a cent until someone actually clicks on your ad.
Second, digital healthcare marketing carefully targets the patients most likely to convert. TV ads are broadcast to a wide swathe of viewers, many of whom have no interest in a particular ad’s content. In contrast, with search engine optimization and search ads, your content is delivered to people who are already seeking the services you provide.
Finally, digital marketing fosters new content development. Videos posted to YouTube and social media can go into further depth than a TV ad maxing out at 30 seconds. Blog posts can expose patients to your services in organic ways by giving them useful information.
The long-term consequences of the drug price disclosure rule will become clearer in time, but for now we can say with confidence that digital marketing will only become more essential for healthcare organizations. Medical marketers that haven’t invested in SEO, PPC, or social media advertising should consider expanding their strategies in order to reach new patients.