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September 15, 2004

Senate Panel Weighs Tighter Rules for Hospital Suppliers

The New York Times reports, "The Senate is considering legislation that would give the Department of Health and Human Services greater power to regulate the medical products industry's methods for selling drugs, supplies, medical devices and equipment to America's hospitals. After hearing testimony on Tuesday from health care and antitrust specialists who argued that the industry should not be left to regulate itself, members of the Senate antitrust subcommittee said they thought legislation was necessary to end abusive practices and circulated a draft bill for discussion."

In Direct-to-Consumer Advertising and the Demand for Cholesterol-Reducing Drugs, John E. Calfee, Clifford Winston and Randolph Stempski discuss the results of the 1997 Food and Drug Administration advertising rule change on a subset of drugs in high demand to fight high cholesterol. The FDA reinterpreted its advertising regulations to ease limits on the use of broadcast media when advertising prescription drugs directly to consumers. Calfee, Winston, and Stempski estimate the effect of direct-to-consumer advertising on demand, using 1995–2000 data from the market for the statin class of cholesterol-reducing drugs. They find no statistically significant effect from any form of advertising and promotion on new statin prescriptions or renewals and no evidence of adverse market effects from advertising or the FDA policy change. The authors did find evidence, however, that television advertising increased the proportion of cholesterol patients who had been successfully treated, which suggests that advertising reinforces compliance with drug therapy.

Also of interest from the Joint Center:

The FDA and the First Amendment: Comments on Pharmaceutical Regulation John E. Calfee

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