Bad-Drug Ads or Killer Ads: The Effects of Drug Injury Advertising on Public Health

This paper analyzes the impact of lawsuit advertisements targeting drug companies. Although the main purpose of the ads is to recruit potential lawsuit plaintiffs, they also reach a broad audience of viewers. Medical professionals have raised concerns that drug injury ads may lead uninjured patients to misperceive the risks and benefits of treatment, leading them to discontinue medically necessary drugs. The paper examines how drug injury ads affect prescription fills and subsequent health outcomes. The empirical context analyzes anticoagulants, which are commonly used by elderly patients to prevent strokes. The study finds that drug injury ads lead to a decrease in filled prescriptions for targeted drugs and a corresponding increase in hospitalizations for conditions treated with anticoagulants. These results point to meaningful public health consequences and highlight the benefits from policy responses that promote accurate and balanced information. This paper was accepted by Jean-Pierre Dube, marketing. Funding: Financial support for this research was generously provided through the National Science Foundation [Grant SES-1919040] and the Morrison Center for Marketing and Data Analytics. Supplemental Material: The online appendices and data files are available at https://doi.org/10.1287/mnsc.2023.04294 .