Direct-to-consumer advertising and online search

Abstract

Beginning in 1997, the Food and Drug Administration (FDA) allowed television advertisements to make major statements about a prescription drug, while referring to detailed information on the internet. The hope was that consumers would seek additional information online to understand the risks and benefits of taking the medication. This policy motivates us to analyze direct-to-consumer advertising (DTCA) and search engine click-through data on a set of drugs over the period from 2008 to 2011.Regression analysis shows that DTCA on a prescription drug is associated with a higher frequency of online search and subsequent clicks for that drug, as well as search for other drugs in the same class. While the FDA’s policy was intended to direct consumers to the internet for drug information, the effects of DTCA are larger for paid clicks relative to organic clicks and for clicks on promotional websites relative to informational websites. We also find the relationship between DTCA and search is heterogeneous: the effects are stronger for younger drugs and drugs that treat acute conditions.