Feds eye tighter restrictions on pharma ads Image By HPN Staff The Trump administration, led by Secretary of Health and Human Services Robert F. Kennedy Jr., is considering proposals to impose restrictions on pharmaceutical advertisements. According to a recent report published by Bloomberg, the administration is considering two proposals — one to require greater disclosure of a drug’s side effects in advertisements, and one to strip pharmaceutical companies of the ability to deduct direct-to-consumer (DTC) advertising costs as a business expense. This comes on the heels of a bill introduced by Sen. Bernie Sanders (I-VT) and Sen. Angus King (I-ME) that would outright ban direct-to-consumer advertising of pharmaceuticals. The United States and New Zealand are the only two nations that allow such advertising. Why it matters According to a recent study paid by the Campaign for Sustainable Rx Pricing, the pharmaceutical industry spends roughly $14 billion annually on DTC advertising. Of that, the industry spent more than $5.15 billion on national television ads for prescription drugs in 2024. Proponents of efforts to ban or restrict the practice say that this contributes to high prescription drug costs in the U.S., and that DTC advertising drives consumers towards more expensive brand-name drugs, and away from cheaper generics. Yet opponents of the measures point to the benefits of consumer education, including prompting some patients to discuss particular conditions with their doctors for the first time. Kennedy has long been a proponent of restrictions on DTC drug advertising, suggesting as recently as last November that he hoped to institute a ban on pharmaceutical TV ads. However, outright bans of the practice, as the Sanders bill calls for, could face substantial legal challenges. In 2012, the 2nd Circuit Court of Appeals in U.S. v. Coronia found that pharmaceutical companies possess a First Amendment right to use “truthful, and non-misleading speech” to promote off-label uses for their drugs. Furthermore, the FDA says that it lacks the ability to limit the amount of money drug companies spend on advertising. Rather than banning prescription drug DTC advertising, the proposals being floated by the HHS seek to impose financial restrictions on the practice that will make it more expensive and limit its reach. The proposal to expand side-effect disclosures, for instance, would reverse a 1997 FDA rule easing the disclosure mandate, and would lead to longer, and therefore more expensive, advertising spots, which industry experts say could make running such ads “impractical.” The bigger picture The industry says the proposal to remove the ability of drug companies to deduct DTC costs as business expenses for tax purposes could set a bad precedent of singling out a specific economic sector and potentially spur legal action. The tax provisions have been discussed previously, with a bipartisan bill introduced earlier this year to do just that. There was also talk of including it in the reconciliation package, but neither the House nor Senate versions of the spending bill ultimately included it. While many in the bio-pharma industry see these proposals as a direct economic threat, HHS spokesman Andrew Nixon said in a written statement that “We are exploring ways to restore more rigorous oversight and improve the quality of information presented to American consumers.” He added that no concrete decision has yet been made by the administration on either proposal.
