Marketing and Advertising of Pharmaceuticals


This report is a compendium of state laws and related resources describing or affecting the marketing and advertising of pharmaceuticals, including disclosure of information relating to the practices. 

NOTE: Parts of the tables of enacted laws are an archive report, researched, posted and updated as of 2010.  Please note the dates related to legislation and state laws. 

Numerous states have attempted to legislate different aspects of DTCA, including advertising, marketing, and doctor detailing and counter-detailing. The tables below summarize measures that were enacted.  Soaring drug costs have become a matter of concern for lawmakers and their constituents, especially those on fixed incomes. One question is just how much is advertising on television and in the popular press contributing to these increased costs.

An early analysis provided by the managed care industry for 1999 to 2000 reported that prescriptions written for the top 50 most heavily advertised drugs rose 24.6 percent, compared to 4.3 percent for all other drugs combined.1  With pressure to try to curb the increased costs of prescription medicine, lawmakers have taken a closer look at the implications of pricey advertisements on state-funded programs. At an estimated annual cost of $2.5 billion, pharmaceutical advertising to consumers made drug companies and their brand products household names.

Legislative lawyers point out that it is nearly impossible for individual states to control national advertisements, now regulated by the Food and Drug Administration. But that did not prevent some states from seeking solutions. Back in 2001, 12 states considered bills regarding direct-to-consumer advertising, and at least one-West Virginia-enacted a law that gives the director of the West Virginia Public Employees Insurance Agency discretion to use "innovative strategies," such as requiring prescription drug manufacturers to show how much they're spending on advertising and what that adds to drug costs.

However the director, Tom Susman, stated that West Virginia will most likely train a team of pharmacists to meet with and educate doctors about the fiscal impacts of prescribing higher priced and advertised drugs. "The pharmaceutical industry [representatives] don't talk about costs," Susman stated, "We go in and educate [doctors] about less expensive and therapeutic equivalent drugs and then they can make decisions to use less costly generics." Susman added that physicians [who participate in Medicaid] have an incentive to prescribe less costly drugs. "With only so much money to go around and using less expensive drugs, we have more money to put into paying the West Virginia physicians'."


 Enacted State Laws:

As of December 2012, ten states: California (2004), Connecticut,  Florida (2006) Maine (2003, 2005, 2007), Massachusetts (2008), Minnesota (1993), New Hampshire (2006), South Carolina (2006), Vermont (2002, 2007, 2009), West Virginia (2001) and the District of Columbia (2003, 2008), have laws or resolutions affecting pharmaceutical marketing. A separate Texas law (2007) requires a state-sponsored public awareness campaign to educate consumers about marketing solicitations by email or Internet. Texas (2009) also has required a study regarding the confidentiality of prescription information records. The specific provisions differ among these states - refer to details in the charts below. Note that states such as Maine and Vermont each have two or more separate laws, enacted in different years. Measures that passed both legislative chambers in California and Colorado but were vetoed are not included in the tally above.

As of late 2010 three states—Minnesota, Massachusetts, and Vermont—require drug companies to disclose payments to prescribers and make some of that data public. While each of these states takes a different approach to collecting and making the payment data available to the public (more on that here), information from all three have disclosed the dimensions and scope of marketing relationships.

Recognizing the policy concern, the Pharmaceutical Research and Manufacturers of America (PhRMA) issued a voluntary code of behavior for its member companies, effective July 2002 and updated as of 2013:

Federal Health Reform: Provision for “Sunshine Rule” Brings Disclosure by Drug and Device Manufactures

The ACA includes a less-known provision (Section 6002), called the “National Physician Payment Transparency Program,” or “OPENPAYMENTS.” The CMS published the final rule on Feb. 8, which requires that manufacturers of drugs, biologicals, medical devices and supplies covered by Medicare, Medicaid, or the Children’s Health Insurance Program (CHIP) report payments or other transfers of value to physicians and teaching hospitals. The final rule also requires manufacturers and group purchasing organizations (GPOs) to disclose physician ownership or investment interests. They must also disclose what they pay to doctors for purposes such as consulting or speaking on behalf of the manufacturer or a specific drug. See latest explanation and 2016 data here:
CMS released the data on a public website beginning Sept. 30, 2014.

Federal Analysis and Background

In 2003, the Office of the Inspector General of the Department of Health and Human Services (OIG) published the Compliance Program Guidance for Pharmaceutical Manufacturers (see 68 FR 23731-01), urging pharmaceutical companies to implement compliance programs or review their existing programs. As outlined by the OIG, many gifts, free samples, educational seminars, entertainment and consulting arrangements are practices that risk criminal liability under the federal anti-kickback statute (see 42 U.S.C.A. 1320a-7b(b) " Criminal penalties for acts involving Federal health care programs") whenever the intent of the activity is to increase business. Any time the activity provides a benefit to the physician with the intent to “induce or reward referrals” of federal health care business it violates the anti-kickback statute, even if the activity has a legitimate purpose. (Updated 2018)

In addition to the federal anti-kickback statute and the voluntary guidelines, many states also have their own anti-kickback statutes and many have Medicaid fraud statutes that include anti-kickback provisions. Some states also now require pharmaceutical companies to report annually the amount they spend on specified marketing activities. This survey includes statutes relating to gifts, samples, donations, bribes, and kickbacks by pharmaceutical companies or their representatives to doctors. State anti-kickback laws and Medicaid fraud statutes are included where explicitly applicable.

The table organizes the content into the following subtopics: Disclosure and Reporting Requirements;  Intent; Activities Prohibited;  Penalties for Violations.
The table includes material adopted from Westlaw (c) 2012 - all rights reserved


CA HLTH & S § 119402 Adoption of Comprehensive Compliance Program by pharmaceutical companies; annual dollar limits on certain items; drug samples; annual declaration of compliance (links checked 11/2018)
CA WEL & INST § 14107.2 Kickbacks, bribes or rebates; punishment


CT ST § 21a-70e Pharmaceutical or medical device manufacturing company. Adoption of code on interaction with health care professionals and comprehensive compliance program. Civil penalty

District of Columbia

DC CODE § 48-833.01 Requirement to disclose prescription drug marketing costs
DC CODE § 48-833.02 Manner of reporting
DC CODE § 48-833.03 Content of annual report by manufacturer or labeler
DC CODE § 48-833.04 Department reports
DC CODE § 48-833.05 Confidentiality; public information
DC CODE § 48-843.03 Establishment of the Pharmaceutical Education Program


ME ST T. 22 § 2685 Prescription drug academic detailing program


MA ST 111 § 4N Prescription drugs outreach and education program for physicians, pharmacists and other health care professionals
MA ST 111N § 2 Marketing code of conduct; adoption; prohibited practices
MA ST 111N § 3 Violations of marketing code of conduct prohibited
MA ST 111N § 4 Adoption of marketing code of conduct by pharmaceutical or medical device manufacturing company; training program; annual audits; investigation and correction of noncompliance; compliance officer
MA ST 111N § 5 Annual submission of compliance information
MA ST 111N § 6 Disclosure of data relating to provision of economic benefits valuing fifty dollars or greater
MA ST 111N § 7 Enforcement; penalties
MA ST 175H § 3 Solicitation, improper inducement to use goods, facilities, services, or products covered by insurance
MA ST 175H § 7 Restitution; attorneys fees, costs


MN ST § 62J.23 Provider conflicts of interest
MN ST § 151.29 Violation a misdemeanor
MN ST § 151.461 Gifts to practitioners prohibited
MN ST § 151.47 Wholesale drug distributor licensing requirements


MT ST 37-2-102 Practices declared unlawful between drug companies and medical practitioners  [link update 11/2018]
MT ST 37-2-103 Practices declared unlawful between medical practitioners and pharmacies
MT ST 45-6-313 Medicaid fraud


Additional References and Sources

Court Overturns Verment Datamining Law 11/10



NCSL includes direct to consumer advertising, marketing and disclosure legislation as any legislation that includes such things as:
  1. -Rx manufacturers reporting gifts to doctors over a specific value.
  2. -Reporting/restricting DTCA by Rx manufactures.
  3. -Posting of Rx prices like AWP by Rx manufacturers or PBMs.
  4. -Rx manufacturers disclosing side effects or warnings.
  5. -Rx manufacturers reporting of detailers activities.
  6. -Resolutions for federal agencies to act on DTCA issues.
  7.  any legislation that leads to sensitive data being disclosed and/or otherwise requested by the state that would otherwise not be disclosed by Rx manufacturers or PBMs in normal business practices.

This definition of disclosure does NOT include
-Restrictions on PBM practices and/or HMO disclosure of using PBMs.
-Reporting of adverse events by anyone other than Rx manufacturers.

News Archive:

Examples of DTCA and Disclosure Related State Legislation Enacted into Laws

State/bill/ web link  Description / excerpts of bill text

SB 1765
Sen. Catania

Requires pharmaceutical companies to adopt a Comprehensive Compliance Program that is in accordance with a related federal government publication, to include policies on marketing interactions with health care professionals and limits on gifts and incentives to medical or health professionals, including "specific annual dollar limit on gifts, promotional materials, or items or activities that the pharmaceutical company may give or otherwise provide to an individual medical or health care professional."
(Initial language, deleted from final bill) Would prohibit a pharmaceutical or drug manufacturer from giving gifts to medical or health professionals, with exceptions for drug samples, educational materials, low-cost items primarily associated with a health care professional's practice, and up to 4 meals per year.
(Filed 2/20/04; passed Senate 21y-14n, 4/22/04; amended & passed Assembly 8/23/04; signed into law by governor as Chapter 927, 9/29/04) |

SJR 24
Sen. Ortiz

Memorialized the President and Congress of the United States to recognize the problems caused by direct-to-consumer advertising of prescription drugs by pharmaceutical companies and to take specified actions in the regulation of consumer advertising of prescription drugs.
(Filed 2/25/04; passed Senate 3/30/04; passed Assembly 8/10/04; Chaptered by Secretary of State Res. Chapter 139, Statutes of 2004.)

Councilmember Catania

Enacts the Rx Access Act of 2003, requiring the Dept. of Health to run an AccessRx subsidy program for low-income elderly District residents (eligibility: age 62 or older with household income not more than 200 percent of federal poverty), with enrollees to pay 20 percent of the cost of prescriptions. Also establishes discount prices for qualified uninsured residents (eligibility: any District resident with household income not more than 350 percent of federal poverty, not enrolled in any insurance program) . Requires drug manufacturers to enter into rebate agreements for products sold to publicly funded programs, with public disclosure and possible prior authorization restrictions for products lacking rebate agreements. Includes requirements for disclosure and reporting of Rx marketing costs by manufacturers; also permits negotiations with other states or jurisdictions for bulk purchasing. Also provides that the Department "shall investigate purchases from outside the U.S. Also regulates PBMs, including establishing a legal "fiduciary duty" to any covered entity or customer, transparent business practices, pass through of payments and disclosure of rebates from manufacturers.
(Filed 11/4/03; Passed City Council 3/24/04; signed by mayor as Act 15-410) | [Also required ratification by the U.S. Congress]


SB 1408
Health Care Comm.

Allows for the development and regulation of electronic prescribing practices and provides protection for consumers, including the prohibition of advertising.  Establishes the information that must be contained in electronic prescriptions and provides mechanisms to ensure that patients receive brand name drugs, when such drugs are medically necessary, instead of generic substitutes when prescribed electronically.  This bill would also establish disclosure and confidentiality requirements for medical and prescription records.
(SB 1408 filed 1/13/06; passed Senate 37y-0n, 3/29/06; passed House 118y-0n, 5/3/06; signed into law by governor as Chapter 2006-271, 6/22/06)

HP 1141/ LD 1618
Rep. Lerman

Prohibits pharmaceutical companies from advertising on television, radio or in print unless material meets federal guidelines. Also includes clinical trial requirements that manufacturers "shall post on the public website of the federal  National Institutes of Health or another publicly accessible website information concerning any clinical trial that the manufacturer conducted or sponsored beginning October 15, 2002; includes a fee for Rx manufacturers that advertise in the state for maintaining the clinical trial database.
(Filed 5/3/05; passed House 73y-72n, 6/10/05; passed Senate 6/10/05; signed into law by governor as Chapter 392, 6/15/05) 

LR 1702/ LD 1541
Sen. Weston

Limits the pricing information that a pharmaceutical manufacturer must report to the state to average manufacturer price (AMP) and best price as defined by federal law. It eliminates the instructions on calculating other pharmaceutical pricing information and the requirement to describe the methodology for calculating pricing information that is reported. It also  strengthens the confidentiality protection afforded to the reported information.
(Filed 4/4/05; passed to be enacted by House and Senate 6/9/05; signed into law by governor as Chapter 402, 6/17/05)

HP 5 / LD 4
Rep. Faircloth

Prohibits the sale of pharmaceutical information that identifies directly or indirectly the practitioner who ordered the prescription drug; establishing a mechanism for confidentiality protection through an opt-out procedure, comparable to the federal "Do Not Call List," utilizing the licensing and relicensing process for prescribers. The procedures include methods for filing with the Maine Health Data Organization to protect confidentiality of prescriber-identifying information by restricting its use to non-marketing purposes.
(Filed 1/3/07; passed House; passed Senate 6/20/07; signed into law by governor as Public Law Act 460, 6/29/07)
NEWS UPDATE:  ME: Medical data law disputed in lawsuits by The Associated Press, Portland Press Herald, 8/31/07.  Companies that collect, analyze and sell medical data filed lawsuits Wednesday in federal courts in Maine and Vermont, challenging laws in the two states that make doctors' prescription-writing habits confidential.

LD 254/H 209

Require full disclosure of prescription drug marketing costs.
(Filed 1/23/03 and sent to committee; passed to be enacted by both House and Senate 5/28/03; signed by governor 6/5/03)


Prohibits any manufacturer or wholesale drug distributor, or any agent thereof, to offer or give any gift of value to a practitioner over $50. Some exceptions apply.
(Signed into law, 1993)

HB 1346
Rep. Rosenwald

Prohibits individual prescription information from being transferred or sold for any commercial purpose except for the limited purpose of reimbursing the pharmacy.  Commercial purposes include advertising, marketing, promotion, or any activity that could be used to influence sales or market share of a pharmaceutical product, influence or evaluate the prescribing behavior of an individual health care professional, or evaluate the effectiveness of a professional pharmaceutical detailing sales force.  It does not prevent the collection of such data, nor does it prevent its use for reimbursement, research, utilization review, compliance, education, or as provided by law. Commercial use of prescriber identity is also allowed by zip code or medical specialty.  Effective date: June 30, 2006.
(Filed 1/4/06; passed House 2/22/06; passed Senate 22y-0n, 5/4/06; final passage, enacted 5/24/06; 6/7/06; signed into law by governor as Chapter 328, 6/30/06)
HB 3711
Rep. Cobb-Hunter
Enacts the Prescription Drug Discount Card Registration Act; providing for registration with the Department of Consumer Affairs of persons and representatives engaged in the sale, marketing, promotion, advertisement, or distribution of prescription drug discount cards or other purchasing devices. (Filed and referred to committee 3/8/05; re-referred to committee 3/16/06; passed House 4/26/06; passed Senate 6/1/06; House concurred 6/1/06; became law without governor's signature as Act 377, 6/14/06)

S 646
Sen. Van de Putte

Requires a study regarding the confidentiality of prescription information records and the use and sale of prescription information records containing patient-identifiable and practitioner-identifiable information by pharmacy benefit managers, insurers, electronic transmission intermediaries, pharmacies and other similar entities for the purpose of advertising, marketing, or promoting pharmaceutical products. Also provides a civil penalty up to $5,000 for companies that fail to provide required information.  A report is due by August 1, 2010.
(Filed 2/3/09; signed into law by governor  6/19/09)

HB 1676
Rep. Delisi,
Sen. Van de Putte

Requires the TX Attorney General to develop a public awareness campaign to educate consumers about solicitations by email or Internet, including information on distinguishing reputable pharmacies from unlicensed or fraudulent sales. The campaign may use brochures, advertisements and similar outreach and may accept grants and donations to fund the effort.
(Filed 2/20/07; HB 1676 passed House 145y-0n, 3/28/07; passed Senate 4/26/07; signed into law by governor 5/14/07)

S 115
S. Finance Comm.

Increases "transparency of prescription drug pricing and information" by limiting "fraudulent" advertising of prescription drugs to consumers and health care professionals, requiring notice to clients by pharmacy benefit managers that certain types of contracts are available, establishing an evidence-based education program, providing additional pricing information including "AMP" and "Best Price," to the Medicaid program from drug manufacturers and requiring disclosure of education programs funded by drug manufacturers.  Also establishes regulation of PBMs including requiring that all financial and utilization information requested by a health insurer be provided, disclose the costs and financial arrangements with any formulary management, drug substitution including rebate and discount agreements.  Such disclosures may be defined as confidential and not subject to court inquiry.
(Filed 2/23/07; amended 3/20/07; passed Senate 28y-1n, 4/4/07; passed House 89y-44n, 5/4/07; signed into law by governor as Chapter 80, 6/9/07)

COURT UPDATE:   In a decision issued 11/23/2010 in IMS Health, Inc. v. Sorrell, the United States Court of Appeals for the Second Circuit overturned a Vermont law limiting the sale of physician-identifiable prescription data, finding that it was an impermissible restriction of commercial speech.   In doing so, the Second Circuit overturned the Vermont district court, and split with the First Circuit, which had earlier upheld such laws in Maine and New Hampshire. Second Circuit Court of Appeals Strikes Down Vermont Law on the Sale of Prescriber Data.

H 768

FY 2005 Appropriations Act provides:
(Sec. 128a) Retail pharmacists are required to disclose prescription drug prices to consumers; (Sec 128b) pharmaceutical marketers are required to disclose prescription drug "AWP" prices to health care professionals, and report gifts and marketing expenditures to the Attorney General;
(Sec. 128d) state pharmaceutical assistance programs are required to provide coverage for over-the-counter drugs listed on the state preferred drug list; pharmacy benefit managers and health insurers are required to permit retail pharmacists to use same prices and quantity as mail-order pharmacies; the state department (PATH) is required to implement an evidence-based research program featuring generics and "counter-detailing", by January 1, 2005. Also contains other Rx provisions unrelated to marketing.
(Passed House and Senate 5/20/04, signed by governor as Act 122, 6/10/04) |

H.31 of 2002
Sen. Shumlin

This multi-featured pharmaceutical law includes:
1) Counterdetailing"- Implements education programs, including a counterdetailing program, designed to provide information and education on the therapeutic and cost-effective utilization of prescription drugs to physicians, pharmacists and other health care professionals authorized to prescribe and dispense prescription drugs;
2) Disclosure of gifts and cash payments to doctors- Annually on or before January 1 of each year, every pharmaceutical manufacturing company shall disclose to the Vermont board of pharmacy the value, nature and purpose of any gift, fee, payment, subsidy or other economic benefit provided in connection with detailing, promotional or other marketing activities by the company, directly or through its pharmaceutical marketers, to any physician, hospital, nursing home, pharmacist, health benefit plan administrator or any other person in Vermont authorized to prescribe, dispense, or purchase prescription drugs in this state. Disclosure shall be made on a form and in a manner prescribed by the board. Initial disclosure shall be made on or before January 1, 2004 for the 12-month period ending June 30, 2003. The board shall provide to the office of the attorney general complete access to the information required to be disclosed under this subsection. The office of the attorney general shall report annually on the disclosures made under this section to the general assembly and the governor on or before March 1.
3) Creates a discount program, preferred drugs and other features - see full description on 2002 Prescription Drug Discount, Bulk Purchasing and Price-Related Legislation
(H 31 House and Senate final passage, 5/31/02; signed by governor, 6/13/02)|

HB 4084
Del. Michael

West Virginia Pharmaceutical Availability and Affordability Act 1) establishes a state-sponsored clearinghouse for consumer Rx information; 2) establishes a state-sponsored prescription drug discount card program for residents with annual incomes up to 200 percent of federal poverty guideline. The program may use voluntary manufacturer rebates but may not use formularies or preferred drug lists; 3) establishes a state Council that "shall establish a pricing schedule using or referencing the FSS (Federal Supply Schedule) prices", which requires a future, additional legislative vote of approval or rejection. Also provides that the state shall "explore the feasibility of using or referencing, the federal supply schedule or Canadian pricing. 4) requires the state to "investigate the feasibility of purchasing prescription drugs from Canada," including feasibility of serving as a wholesale distributor of prescription drugs in the state." 5) requires reporting of Rx advertising costs.
(filed; passed House 1/22/04; passed Senate and Conference 3/13/04, signed by governor 4/7/04) |
WV Pharmaceutical Cost Management Council -website


S 127 ('01)
Senate Pres. Toblin

Allows WV Public Employees Insurance Agency to pursue a multi-state buying pool with all state agencies and institutions, as well as "governments of other states and jurisdictions, and "regional or multistate purchasing alliances". Allows "innovative strategies", such as "enacting fair prescription drug pricing policies" and providing discount prices or rebate programs for seniors" and uninsured. The agency may explore "requiring prescription drug manufacturers to disclose to the state expenditures for advertising, marketing and promotion, as well as for provider incentives and research and development efforts." PEIA director's description.
(Passed House and Senate; signed by Governor 5/15/01 as Chapter 97)


Additional References and Sources

Government Reports

GAO Report: Improvements Needed in FDA’s Oversight of Direct-to-Consumer Advertising (November 2006)
The Food and Drug Administration (FDA) is responsible for overseeing direct-to-consumer (DTC) advertising of prescription drugs. If FDA identifies a violation of laws or regulations in a DTC advertising material, the agency may issue a regulatory letter asking the drug company to take specific actions. GAO was asked to discuss (1) trends in drug company spending on DTC advertising and other activities; (2) what is known about the relationship between DTC advertising and drug spending and utilization; (3) the DTC advertising materials FDA reviews; (4) the number of regulatory letters that cited DTC materials and FDA's process for issuing those letters; and (5) the effectiveness of these letters at limiting the dissemination of violative DTC advertising. GAO reviewed research literature, analyzed FDA's processes, and examined FDA documentation.

Health Affairs- Forum on Prescription Drug Promotion. February 26, 2003- ABSTRACT: Spending on prescription drugs and promotion by the pharmaceutical industry grew substantially during the past ten years. Does the greater exposure offered by promotion fill a needed educational gap, or does it merely promote inappropriate use? This paper uses two recent studies to explore this question, presenting a framework in which the impact of promotion depends upon the level of evidence and consensus on drug use. . The survey is accompanied by five perspectives debating the pros and cons of direct-to-consumer drug advertising. (Full report can be read at:

New GAO Report Affirms Pharmaceutical Company Spending On Research For New Medicines and Cures Far Outpaces Promotional Spending - December 5, 2002 - (Link to press release provided by PhRMA) Link to GAO Report # 03-117

Prozac-in-the mail incident highlights drug companies' aggressive tactics August 6, 2002- The Associated Press

The Fight to Keep 'Direct-to-Consumer Ads' - July 12, 2002- New York Times

Disclaimer: NCSL is not responsible for information or opinions contained in internet links to web sites outside this organization. NCSL does not provide advice to consumers seeking to participate in state-based programs. For state-specific details, please use the contact telephone numbers provided on the State Pharmaceutical Assistance Programs web report by NCSL. NCSL takes no position for or against state health legislation.

 Compiled by Karmen Hanson; updates by Richard Cauchi and Kara Hinkley, NCSL Health Care Program- Denver