Health Care Ad Spending Slashed Due To Reforms

Pharmaceutical manufactures are not the only ones having their profits and margins hit by changes in the health care environment. Those thus far involved in helping drugmakers sell their products are faring even more badly. This is the view expressed in Advertising Age.

The journal points out that so far, as a result of the shift to managed care, drug companies have: - slashed sales forces by up to 25%; - redirected marketing efforts in terms of what they sell, how they sell and to whom they sell; - and cut advertising spending in medical journals by about one-third.

A by-product of the promotional spending cuts, AA predicts, is that in the next couple of years, one-third of the agencies that handle pharmaceutical manufacturers will go out of business.