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Introduction
The objective of this paper is to analyze the Learned Intermediary Doctrine (the LID) and how the courts apply the doctrine to advertisements in the health-care industry. The health-care industry has witnessed radical changes and innovations during the past five decades. Factors such as changes in the regulatory climate and competitive environment account for some of these changes (Rettig, 1994); however, the lion’s share of the changes could be attributed to the advancements in technology (Gelijns et al., 2001). A firm’s ability to remain at the forefront of innovations and generate cash flow that is needed for R&D relies on new products being marketed successfully and often through aggressive advertising. However, in the field of health care, unlike other fields such as information technologies, advertising implicates several laws and regulations.
In the health-care industry in the USA, the question of when an innovation (a drug or medical device) is ready for market is not determined by management through market research, but rather by the Food and Drug Administration (FDA). Furthermore, claims that pharmaceutical companies can legally make in advertisements for prescription drugs that are advertised to the general public and sold through the direct-to-consumer (DTC) advertising are also regulated by the FDA. The adverting content of over-the-counter (OTC) drugs is, however, regulated by the Federal Trade Commission.
The DTC advertising of prescription drugs is one of the unusual developments in marketing/communication strategy in the health-care industry that was approved by the FDA in the 1980s. The DTC advertisements have been the subject of many studies (Calfee, 2002; Bell et al., 1999; Lexchin and Mintzes, 2002); however, to date, there is no consensus among scholars on their usefulness to consumers. In contrast, the LID, which also relates to how makers of drugs and medical devices advertise, has received little research attention in the literature. What is the LID, and why should makers of drugs and medical devices understand how it is applied by the courts? This paper is a qualitative research study that seeks answers to these questions. In addition to explaining the law, we discuss how it affects marketing of drugs and medical devices in the USA. Understanding the LID and how it is applied by the courts is important for a...