Newswise — Virtually every day, millions of children and adolescents are being bombarded by sexually explicit direct-to-consumer advertising, despite pharmaceutical CEOs’ claims to the contrary.
Leading business ethicist Denis Arnold from UNC Charlotte co-authored the study, “Self-Regulation in the Pharmaceutical Industry: The Exposure of Children and Adolescents to Erectile Dysfunction Commercials,” published in the just released Journal of Health Politics, Policy and Law. Jim Oakley, professor and chair of marketing at Lewis University, is the study co-author.
Arnold, the Surtman Distinguished Professor of Business Ethics in the Belk College of Business, and Oakley studied marketing campaigns for erectile dysfunction (ED) drugs during a six-year period. These products include sildenafil citrate, manufactured and marketed as Viagra in the United States by Pfizer; and tadalafil, manufactured and marketed as Cialis in the United States by Eli Lilly.
“PhRMA Guiding Principles,” for which both companies have certified their compliance, state that 90 percent of the audience viewing sexually explicit advertisements must be 18 or older. These principles, developed by the Pharmaceutical Research and Manufacturers of America trade organization (PhRMA), were first introduced in 2005, and under these guidelines, a company must commit to internal processes to ensure compliance with the principles, complete an annual certification of compliance and submit a document to PhRMA signed by the CEO and chief compliance officer attesting to compliance.
“Pfizer and Eli Lily have never met the standard, and public disclosure of this misconduct in 2013 did not alter their behavior,” stated Arnold, past president of the Society for Business Ethics. “The most reasonable explanations for this misconduct are that a public commitment to the standard helps block additional regulation, while at the same time there are no penalties for routinely violating the standard.
“Firms continued to aggressively advertise ED drugs when they knew children and adolescents would be exposed to these sexually explicit ads billions of times,” Arnold added.
In 2013, Arnold and Oakley published a research article also in the Journal of Health Politics, Policy and Law that found firms never met the industry standard during a different four-year period they analyzed. This study was widely publicized and acknowledged by the manufacturers of ED drugs and PhRMA. In this new study, Arnold and Oakley sought to answer this question, “Would public disclosure of non-compliance with industry standards improve firm behavior?” The answer, as determined by their recent study, is “no.”
Eric Patashnik, editor-in-chief of the Journal of Health Politics, Policy and Law and the Julis-Rabinowitz Professor of Public Policy and Professor of Political Science at Brown University, stated, “Broadly, they [Arnold and Oakley] found that public disclosure did not cause firms to alter their behavior, suggesting that the pharmaceutical industry is simply not willing to police itself.”
Other findings from “Self-Regulation in the Pharmaceutical Industry: The Exposure of Children and Adolescents to Erectile Dysfunction Commercials” include:
- Twenty years after its introduction in the U.S., spending on direct-to-consumer advertising rose to $6.083 billion or five times as much as 1996 in inflation-adjusted dollars. This is more than double what the U.S. film industry spent on marketing
- On average, there were 35-40,000 ED advertising impressions on children and adolescents daily, totaling more than five billion impressions, between Jan. 1, 2010, and Dec. 31, 2015
- Public disclosure of non-compliance with self-regulatory direct-to-consumer advertising standards did not bring advertising into compliance. Results demonstrate that firms failed to meet the industry standard during every quarter of this study’s six-year period
- Results support previous research that demonstrated that pharmaceutical self-regulation is a deceptive blocking strategy aimed and preventing further regulation rather than a means for the industry to police itself
About the Authors:
Denis Arnold, who completed a Ph.D. from the University of Minnesota, is professor of management and the Surtman Distinguished Professor of Business Ethics in the Belk College of Business at UNC Charlotte. His publications include a number of journal articles, chapters and books. The past editor-in-chief of the academic journal Business Ethics Quarterly, Arnold is past president of the Society for Business Ethics, the main professional organization for business ethics scholars in the United States. His expertise has been utilized by more than 20 different global media outlets.
James L. Oakley is professor and chair of the Department of Marketing at the Lewis University College of Business. His research focuses on marketing strategy, branding and the influence of an organization’s behavior on customer relationships. His articles have appeared in Journal of Brand Strategy, Journal of Marketing Management, and Journal of Consumer Research, among others. He holds a Ph.D. in marketing from the Kellogg School of Management at Northwestern University, an MBA from Purdue University and a bachelor’s degree in psychology from the University of Illinois. A variety of media outlets such as the Financial Times and BusinessWeek have featured his research.