Premium
The effect of medical cannabis laws on pharmaceutical marketing to physicians
Author(s) -
Lebesmuehlbacher Thomas,
Smith Rhet A.
Publication year - 2021
Publication title -
health economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.55
H-Index - 109
eISSN - 1099-1050
pISSN - 1057-9230
DOI - 10.1002/hec.4380
Subject(s) - cannabis , medical prescription , medical cannabis , business , market share , prescription drug , family medicine , marketing , medicine , psychiatry , pharmacology
Although cannabis is federally prohibited, a majority of U.S. states have implemented medical cannabis laws (MCLs). As more individuals consider the drug for medical treatment, they potentially substitute away from prescription drugs. Therefore, an MCL signals competitor entry. This paper exploits geographic and temporal variation in MCLs to examine the strategic response in direct‐to‐physician marketing by pharmaceutical firms as cannabis enters the market. Using office detailing records from 2014‐2018 aggregated to the county level, we find weak evidence of a relatively small and delayed response in substitute prescription drug‐ and opioid‐related detailing. While these effects on detailing dollars are more pronounced among smaller pharmaceutical firms, the magnitudes are economically small and likely muted at aggregate levels by the small percent of doctors that actively recommend cannabis for medical treatment.