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The effect of medical cannabis laws on pharmaceutical marketing to physicians

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  • Thomas Lebesmuehlbacher
  • Rhet A. Smith

Abstract

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.

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  • Thomas Lebesmuehlbacher & Rhet A. Smith, 2021. "The effect of medical cannabis laws on pharmaceutical marketing to physicians," Health Economics, John Wiley & Sons, Ltd., vol. 30(10), pages 2409-2436, September.
    • Handle: RePEc:wly:hlthec:v:30:y:2021:i:10:p:2409-2436
    DOI: 10.1002/hec.4380
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    References listed on IDEAS

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    Cited by:

    1. Cameron M. Ellis & Martin F. Grace & Rhet A. Smith & Juan Zhang, 2022. "Medical cannabis and automobile accidents: Evidence from auto insurance," Health Economics, John Wiley & Sons, Ltd., vol. 31(9), pages 1878-1897, September.

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