[H165]Health Insurance Companies Profits

Drug companies claim that to spend about 35% of their total revenue on marketing. That might not seem too astronomical, but when you're talking about an industry that does its business in the billions, it adds up quickly. The drug companies claim that in 2001 it spent far less money on advertisement than it did on research and development (30.3 billion). In this article we will look at how much the drug companies are actually spending on advertisement and how they are manipulating the facts in order sell more prescription medication.

Drug companies split advertisement or marketing and administration as they like to call it, (this helps give them another place to say money is being spent other than advertising) into for basic categories: direct to consumer advertising (TV commercials), doctors office solicitation, medical journal advertisement, and free samples for doctors. PhRMA reported in 2001 that the total spending for all the drug companies was $19.1 billion, far less than the $30.3 billion spent on research and development. The fact is the $19.1 was just a portion of it.

The reported $19.1 billion should have been a little bit closer to $54 billion, which is 30% of the recorded $179 billion of recorded revenue. So where is the missing $35 billion? In the disclaimer: ?these figures do not include educational meetings arranged by pharmaceutical companies for physicians, which are not generally considered to be promotional activities.? Pretty convenient to have a category to throw any of the expenses you don't want to record into.

One of the more prevalent ways drug companies are using their advertising money is through doctor's office salesmen. In 2001 drug companies gave 11 billion dollars worth of ?free samples? away and sent 88,000 salesmen to doctor's offices to promote their drugs. This is the drug companies way of offering doctors bribes. Aside from the usual rounds of golf, free meals, ?medical conferences?, and free samples, a good example of a drug company bribing doctors to use their products is the Lupron case.

When Lupron, a hormone treatment for prostate cancer, began to face competition from Zoladex, a new drug in the same market, the makers of Lupron found a way to keep doctors prescribing their medication over the new alternative. Lupron inflated their price of a dose of their medication to $500 and then sold it to doctors for $350. Medicare would then pay $500 for the medication and the doctors would get to keep the ?left over?, using taxpayer money to provide monetary incentive for doctors to prescribe their drug.

Where do you think the drug companies get these billions of dollars to throw around on advertising and bribes? They get it from inflating there drug prices. Are government says that we don't have price controls to promote a truly creative market that produces new innovative drugs. But not having price controls ends up just creating a way for the drug companies to raise there prices.

So where should you by your prescription medication? From a market other than the United States. A great resource for finding the cheapest and safest pharmacy is NoPrescriptionNeeded.com. NPN allows you to search all the pharmacies for the drug you are looking for, and shows you which pharmacies offer your drug the cheapest. They also have a pharmacy rating system based on the feedback left by other users, so that you order from only the safest most reputable pharmacies. Visit this Consumer Advocacy website for more information on ordering from an online <---****HYPERLINK****--->"http://www.noprescriptioneeded.com">no prescription pharmacy.