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The Effects of Pharmaceutical Marketing and Promotion on Adverse Drug Events and Regulation

Guy David, Sara Markowitz () and Seth Richards-Shubik

American Economic Journal: Economic Policy, 2010, vol. 2, issue 4, 1-25

Abstract: This paper analyzes the relationship between postmarketing promotional activity and reporting of adverse drug reactions (ADRs) by modeling the interaction between a regulator (the FDA) and a pharmaceutical firm. Promotion-driven market expansions enhance profitability yet may involve the risk of inappropriate drug prescriptions, leading to regulatory actions against the firm. We empirically test the relationship between drug promotion and reporting of ADRs using an innovative combination of commercial data on pharmaceutical promotion and FDA data on regulatory interventions and ADRs. We provide some evidence that increased levels of promotion and advertising lead to increased reporting of ADRs for certain conditions. (JEL L51, L65, M31, M37)

JEL-codes: L51 L65 M31 M37 (search for similar items in EconPapers)
Date: 2010
Note: DOI: 10.1257/pol.2.4.1
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