Upfront 2003: Prescription Drugs

As expected, direct-to-consumer (DTC) prescription drug advertising is leveling off for major media outlets, including network prime time. That’s largely the result of a fairly lackluster pipeline of pharmaceuticals in development, along with the number of highly advertised blockbuster drugs that have come off patent, or will be shortly.

Pharmaceuticals to treat ailments such as arthritis and allergies are typically advertised to consumers, but many of the bigger Food & Drug Administration approvals in 2002 were for drugs and treatments that don’t as easily lend themselves to consumer media—including new drugs for cancer treatment, schizophrenia and irritable bowl disorder.

The double-digit increases the category has enjoyed over the past few years are clearly over for now, and this year analysts are predicting pharmaceutical advertising to be nearly flat or at best, perhaps, a slight bump. Following years of rapid growth, last year—and for the first time since 1997—pharmaceutical advertising declined compared to the year previous. Overall, drug companies dropped their ad spends in 2002 by 9 percent to $2.5 billion, per Competitive Media Reporting.

TV advertising was not hit the hardest; instead, newspapers suffered the biggest declines. Nonetheless, the picture wasn’t exactly rosy for the nets: prime-time DTC spending skid by 6 percent last year to $510 million.

Merck’s Zocor, Pfizer’s Lipitor and other medications in the cholesterol and blood pressure categories have accounted for a good amount of DTC advertising over the past several years. New product didn’t necessarily spell new business for media. Zetia, one of the newer cholesterol medications, approved by the FDA at the end of last year, initially was expected to be supported with a major consumer media blitz. But co-marketing partners on the drug, Schering-Plough and Merck, recently said instead of a major DTC pitch—which could have been in the $100 million range, in line with competitors—marketing for Zetia would instead focus on detailing to physicians.

Media spending in the highly visible prescription allergy segment is likely to drop off, perhaps by as much as 50 percent, if insurers manage to get the FDA to push the three major allergy pills—S-P’s Clarinex, Aventis’ Allegra and Pfizer’s Zyrtec—over the counter.

Last year, Aventis spent $130 million on media for Allegra, which was the second-most-advertised drug in 2002 after AstraZeneca’s Nexium. Out of that $130 million, $24 million was allocated to prime-time network spots. Similarly, Pfizer’s Zyrtec bought $20 million in prime-time business last year.

Though S-P currently has an approximate $40 million total media push for its now-OTC Claritin, in addition to a campaign for the next-generation prescription version Clarinex, typically advertisers spend quite a bit less on marketing the less profitable OTC drugs. Already, many insurers are not reimbursing patients for prescription allergy drugs since Claritin went OTC.

One of the bright spots for the immediate future: two new impotence drugs meant to rival Pfizer’s groundbreaking Viagra, both which are expected to be approved for sale in the U.S. this year. The new treatments: Cialis from Eli Lilly and Levitra, a joint effort between GlaxoSmithKline and Bayer. Both drugs are being touted as working faster than Viagra. Lilly’s Cialis claims to be effective for up to 24 hours.

All that is bound to result in a major ad war between the three brands, which could account for at least an additional $75 million to $125 million in network prime-time ads, based on the size of a typical blockbuster campaign and recent media support for Viagra.

Just a handful of other drugs expected to be approved in the next 12 months are likely to be launched with significant DTC support. Those include: Abbott Laboratories’ Humira for rheumatoid arthritis; AZ’s cholesterol drug, Crestor; and Cymbalta, a Eli Lilly antidepressant.

Pfizer put a total of $87 million into DTC ads last year, $27 million of that going toward prime-time network, per CMR. —

Prime-time Network Spending in 2002: $510.1 million*
Hot Buttons: Drop off in DTC spend keeping business flat, even as a slew of new product launches emerge.

Category: Pharmaceuticals
PERIOD: Jan 1, 2002 – Dec 31, 2002

Advertiser: Prime-Time Network TV $$$
GlaxoSmithKline PLC: $202.8 million
Pfizer Inc.: $166.8 million
Merck & Co. Inc.: $126.6 million
Johnson & Johnson: $116.9 million
Astrazeneca PLC: $110.4 million

Top Programs for Pharmaceutical Ads: expenditures
60 Minutes: $18.9 million
CBS Sunday Night Movie: $18.6 million
JAG: $13.5 million
Source: Nielsen Monitor-Plus