Big Drug Companies’ TV Ads—Currently Subsidized by Taxpayers—Would Lose Tax Break Under New McCaskill Bill

American taxpayers subsidized more than $6 billion in drug companies’ fully tax-deductible advertising expenses in 2015

WASHINGTON – Taxpayers are currently subsidizing billions of dollars in television, online, magazine, and other advertising from drug companies that can fully deduct the cost of that advertising from their taxes, all while those companies are continuing to raise prescription drug costs—a move U.S. Senator Claire McCaskill is taking aim at with legislation to end the practice.

“Drug companies have too much influence in Washington,” McCaskill said. “So it figures we are one of the only nations in the world that allows both advertising of prescription drugs to consumers and allows those ads to be subsidized by taxpayers. I’m determined to fight these high drug prices and a good first step would be to stop subsidizing their ads for drugs that must be prescribed by a doctor. Too many drug companies are spending more on sales and marketing than on research and development. And Missourians are tired of paying for it.”

The United States is one of only two countries that allows “direct-to-consumer” pharmaceutical advertising. It was recently reported that large pharmaceutical companies are using savings from the recent Republican tax bill for a combined $50 billion on stock-buyback programs, including executive compensation, rather than research and development to develop new life-saving treatments.

McCaskill has made tackling rising healthcare and prescription drug costs in Missouri a top priority in the Senate. McCaskill’s bipartisan legislation with Republican Senator Susan Collins of Maine to increase competition for generic drugs and help lower prescription costs was signed into law by President Trump. The legislation stems from the only bipartisan investigation into the causes, impacts, and potential solutions to the egregious price spikes for certain drugs, which was led by McCaskill and Collins last Congress.

McCaskill, the top-ranking Democrat on the Senate Homeland Security and Governmental Affairs Committee, recently released the latest product of her wide-ranging investigation into opioid manufacturers and distributors. “Fueling an Epidemic: Exposing the Financial Ties Between Opioid Manufacturers and Third Party Advocacy Groups” describes how manufacturers of opioids have made significant financial investments into third party organizations—groups which in turn have engaged in pro-opioid advocacy over a long period of time, including through guidance minimizing the risks of opioid addiction and the endorsement of opioid use for the long-term treatment of chronic pain—an approach not backed up by medical science.

Visit to learn more about McCaskill’s fight to improve healthcare for Missourians.