• Project

    FTC Complaint on Digital Pharma & Health Marketing

    Complaint, Request for Investigation, Public Disclosure, Injunction, and Other Relief: Google, Microsoft, QualityHealth, WebMD, Yahoo, AOL, HealthCentral, Healthline, Everyday Health, and Others Named Below

    November 23, 2010 - Washington, DC: In a complaint filed today with the Federal Trade Commission, the Center for Digital Democracy, U.S. PIRG, Consumer Watchdog, and the World Privacy Forum called on the commission to investigate unfair and deceptive advertising practices that consumers face as they seek health information and services online. Consumers now confront a sophisticated and largely stealth interactive medical marketing apparatus that has unleashed an arsenal of techniques designed to promote the use of specific brand drugs and influence consumers about treatments for health conditions. Much of the online health marketing system has been deliberately structured to collect personal information and other data on consumers, including through the use of free e-newsletters on specific medical concerns; discounts for prescription drugs and services; and via the growing number of other online data profiling techniques. Nearly $1 billion dollars will be spent this year by online health and medical marketers targeting the growing number of U.S. consumers who increasingly rely on the Internet for information about medical problems, treatments, and prescription drugs. The online marketing health industry has presented to the FDA and the public a fairytale version of digital marketing, where all consumers become empowered “e- patients,” able to form powerful helping communities. But while the online medium provides medical information to those seeking access to resources and support, it has been structured to engage in aggressive tactics that threaten privacy, raise questions about the fair presentation of independent information, and advance the sales of prescription drugs and over-the-counter products. Pharma and other health online marketers are pressing the FDA for new rules that would allow them to expand digital and social media advertising. Before the FDA acts, it should await an investigation and a report by the FTC. The complaint to the Federal Trade Commission is attached.
  • Children’s Privacy Advocates Praise Federal Trade Commission on Proposed New Safeguards to Protect Children’s Privacy Online Leaders of the Effort that Helped Pass COPPA in 1998 Say Parents Will Now Have Better Ways to Ensure Their Children’s Information is Safe in the Smart Phone and Social Networking Era Washington, DC: Today, the FTC released a Notice of Proposed Rulemaking on its rules implementing the Children’s Online Privacy Protection Act (COPPA), the 1998 law designed to protect the privacy of children under 13. The Commission’s plan would help safeguard children’s data when they are on a mobile phone, playing an interactive game on the Internet, or participating in a virtual world. Under the proposed new rules, children could not be tracked and profiled when online through the use of behavioral targeting and other techniques now regularly used to stealthily collect information on Internet and mobile phone users. Parents and children’s security and safety would be better protected, since the proposed COPPA rules would cover a child’s geo-location data, as well as photos they post online, and would impose new requirements to ensure against data breaches. “Since its passage in 1998, COPPA has served as an important safeguard for young consumers under the age of 13 in the online marketing environment,” commented Kathryn Montgomery, PhD, Professor of Communication at American University, and one of the leaders of the campaign that led to passage of the law. “It established a level playing field by creating a law that applied to every commercial player—from the largest children’s media companies to the smallest start-ups. And it sent a strong signal to the online marketing industry: If you are going to do business with our nation’s children, you will have to follow some basic rules. COPPA was purposely designed to adapt to changes in both technology and business practices. The proposed rules announced by the FTC today reflect careful research and analysis, as well as widespread consultation with major stakeholders. We believe they will help address a number of concerns raised by consumer groups, privacy experts, and child advocates, while at the same time, balancing children’s ability to be active participants in digital culture with the need to protect them from unfair data collection and marketing practices.” Montgomery concurred with the Commission’s recognition that teens also need some privacy protections online. “While some of the mechanisms for protecting younger children are not appropriate for older youth,” she noted, “adolescents are entitled to fair information practices in the digital marketplace. We urge the FTC to address this issue in its forthcoming new comprehensive privacy framework report.” “The Center for Digital for Democracy is pleased that the FTC has finally brought protecting a child’s privacy into the 21st Century,” explained CDD’s executive director, Jeff Chester. “This proposal balances the need to protect the privacy of children, ensure parental involvement, and promotes the growth of kid-oriented online media. At a time when our children spend much of their daily lives online and are always connected to the Internet via games, cell phones and other devices, parents should thank the FTC for acting responsibly on behalf of children.” Among the provisions highlighted by the advocates are: § Extension of privacy protections to the expanding array of digital platforms and marketing venues used to reach and engage young people, including mobile phones and internet-enabled gaming. § The rules’ acknowledgement of increasingly sophisticated technologies for identifying individuals, including IP addresses and geo-location. § Closing of loopholes that made it possible for companies to engage in behavioral targeting and one-to-one marketing aimed at children. § More user-friendly privacy notices to enable parents to make better decisions about their children’s use of online services. “The Institute for Public Representation, which has served as counsel to children’s advocacy groups in efforts to protect children’s online privacy for over sixteen years, is pleased that the FTC is proposing to update its rules to cover new technologies and practices,” said IPR Co-Director and Georgetown University Law Professor, Angela Campbell. The Institute for Public Representation, at Georgetown University Law Center, represented a broad coalition of groups in this FTC proceeding. They included the Center for Digital Democracy, the American Academy of Child and Adolescent Psychiatry, the American Academy of Pediatrics, the Benton Foundation, Berkeley Media Studies Group, the Campaign for a Commercial-Free Childhood, the Center for Science in the Public Interest, Children Now, Consumer Action, Consumer Federation of America, Consumers Union, Consumer Watchdog, National Consumers League, Public Health Institute, U.S. PIRG, and World Privacy Forum. The Children’s Online Privacy Protection Act was passed in 1998 as bi-partisan legislation that had the support of children’s advocates, public health, education, consumer, and privacy groups, as well as leading online marketing companies.
  • Project

    CDD Asks FDA to Revise Its Proposed Research on the Digital Marketing of Drugs and Health Products

    CDD Asks Food and Drug Administration to Revise Its Proposed Research on the Digital Marketing of Drugs and Health Products Urges FDA to Gain Better Understanding of Impact of Digital Marketing on Patients and Health Consumers in order to Protect Public Health

    Washington, DC: The Center for Digital Democracy, in comments filed today with the Food and Drug Administration (FDA), urged the agency to significantly revise its proposed studies on the “Examination of Online Direct-to-Consumer Prescription Drug Promotion.” Citing the wide variety of techniques that pharmaceutical and health marketers use to target consumers online, CDD called for a more informed analysis that reflects how U.S. health consumers are actually marketed to on social networks, mobile phones, and via the Web. Among the marketing techniques that CDD cited that must be part of any FDA research are “the tracking and managing of the ‘patient journey’ online”; data collection; the use of social media analytics and related viral marketing; the role of eye tracking, multivariate testing and other Web page optimization techniques to influence perception and behavior; and the impact of immersive multimedia content and neuromarketing designed to stealthily foster consumer decision-making through non-conscious means. Today is the deadline for comments in FDA’s proposed new research “designed to test different ways of presenting prescription drug risk and benefit information on branded drug Web sites” (Docket No. 2011-N-0230). “While the FDA is to be commended for undertaking additional research before it issues further rules on digital and social media pharmaceutical marketing, we are concerned that the agency—responsible for protecting our health—still has a naïve view of how pharmaceutical digital marketing actually influences consumers,” explained CDD’s Executive Director Jeff Chester. “Online marketing is already an extensive, 360-degree juggernaut that features a wide range of techniques far beyond the scrolling text and banner ads the FDA seems to regard as state of the art. The agency should be in the forefront of ensuring U.S. health consumers have the safeguards they require as they increasingly rely on the Internet and social networks to make decisions about medications and medical treatments.” In its detailed 45-page filing, CDD called on the FDA “to re-conceptualize and update its understanding of digital DTC pharmaceutical marketing,” and pledged its support to assist the agency in expanding its inquiry. CDD urged the FDA to consult with leading independent academic experts and consumer organizations knowledgeable of digital marketing in order to revise its research efforts. CDD’s filing asked the FDA to investigate and develop consumer safeguards for practices used by pharmaceutical and health marketers, including data mining technologies; personalized and behavioral advertising; social media marketing; search engine optimization; rich media and online video applications; mobile and location marketing; unbranded websites; minority and youth marketing; and the use of neuromarketing and other immersive tactics designed to deliberately bypass the rational decision-making process of consumers.
  • An analysis of the contemporary digital marketing landscape, focusing on the promotion of food & beverage products to youth. Written by Kathryn Montgomery, Ph.D., Sonya Grier, Ph.D, Lori Dorfman, Dr.PH, and Jeff Chester, MSW.This report provides a brief summary of how digital marketing works and the role it plays in promoting unhealthy food and beverages to children. Detailed in the report are key concepts of digital marketing; implications for young people’s health; challenges digital marketing concepts raise for researchers; and relevant theoretical models for understanding how the new digital marketing framework acts on children and youth. Crucial gaps in knowledge and an agenda for future research are also highlighted.
  • CDD, U.S. PIRG, Consumer Watchdog, and World Privacy Forum call on the Federal Trade Commission to investigate interactive marketing of pharmaceutical and health products and services to consumers and health professionals. Action is required to protect consumers, including their privacy, in the online health and medical marketplace. The FTC has a role to play to help the Food and Drug Administration address new threats. Read the press release below for details…
  • For the past 25 years, pharmaceutical companies have been permitted to market their products directly to consumers. More recently, in the years following the Food and Drug Administration’s relaxation of direct-to-consumer (DTC) advertising guidelines in 1997, spending on such promotion grew more than six-fold, reaching $5 billion by 2008. In the traditional media of print and broadcast, those DTC ads come with lots of fine print, including warnings of possible side effects that most consumers. But now that ever-increasing amounts of pharmaceutical marketing have moved online, there is another kind of fine print—the truth about invasive and potentially misleading pharmaceutical advertising—that consumers may never see at all. The Center for Digital Democracy recently shared these concerns in a formal filing to the FDA, the highlights of which follow: 1. Personal Data Collection and Privacy Online pharmaceutical and health marketing companies have developed an extensive data collection and interactive targeting apparatus. Few U.S. health consumers are aware that they are being identified, labeled, profiled, and tracked on the Internet while they search or access information on specific conditions or concerns. 2. “Condition” and Behavioral Targeted Advertising Behavioral targeting enables health marketers to stealthily follow consumers online—sometimes across many different websites—gathering details on their interests and activities, and then offering them marketing messages precisely honed to their behaviors related to an illness or condition. Digital marketers employ online “ad networks” to help track and then target individual consumers seeking health-related information. There are also a number of specialized health portals and networks specifically created to target consumers based on particular conditions or concerns. 3. Neuromarketing It should perhaps come as no surprise that many of the companies whose products are rooted in scientific research have turned to neuroscientific techniques in an effort to influence health consumers’ subconscious decision-making processes. Called “neuromarketing,” such techniques are increasingly employed to research, design, and implement online advertising campaigns—including those for health and medical products. NeuroFocus, for example, a firm that specializes in the application of brainwave research to advertising, programming, and messaging, uses “neurological testing [that] delves down to the subconscious mind,” far below such “corrupting factors” as education, language, and cultural variances. Measuring as many as 64-128 sectors of the brain at 2,000 times per second, NeuroFocus promises results that are “unambiguous, accurate, and actionable”—results, we should add, that are achieved without the consumer’s knowledge or consent. 4. Social Media Monitoring and Marketing Perhaps most alarmingly, marketers have developed applications that allow companies to eavesdrop and analyze conversations by and among health consumers, taking advantage of users’ networks of friends to orchestrate peer-to-peer brand promotion. These new surveillance tools monitor conversations among social network users to identify what is being said about a particular issue or product. Marketers then work to insert brand-related messages into the social dialogue, often by identifying and targeting individuals considered brand “loyalists” or “influencers,” and encouraging them to generate buzz through their networks of friends. Increasingly, advertisers are using Facebook’s marketing apparatus—which is largely invisible to its users—to develop a brand presence on its pages so companies can strongly connect to the social communications of a very large pool of consumers. Heartbeat Digital’s BuzzScape, for example “allows clients to monitor discussions that flow in and out of the tens of thousands of message boards, forums, blogs and social networks that increasingly dominate the online environment.” As Heartbeat CEO Bill Drummy admits, “In a sense, we eavesdrop on public conversations among people with a shared interest, then use what we learn to create interactive marketing campaigns that address the identified needs, wants and gaps in knowledge of target audiences.” Perhaps the biggest gap in audience knowledge, of course, is awareness of the fact that online conversations concerning the most sensitive health concerns have become just so much grist for the pharmaceutical marketing mills. 5. Unbranded Sites Another common practice among pharmaceutical companies is the use of online video and websites to raise the awareness of a particular disease or condition—often without clear disclosure of sponsor relationships. Ostensibly designed as educational sites, where individuals can share their experiences with various treatments for certain maladies, sites such as or are also useful to pharmaceutical companies as a “soft sell” opportunity, free of FDA-mandated risk-disclosure and other advertising requirements. 6. Ad Exchanges These commercial arrangements allow companies to auction off individual users to specific advertisers in real time for ad targeting. Increasingly, the targeting is accompanied by so-called “data optimization,” which draws on various information resources to compile more complete profiles of individual users. For example, Google/DoubleClick’s Ad Exchange Health focus has 36 categories, from Arthritis and Diabetes to Respiratory Conditions and Sleep Disorders. Another advertising network, ADSDAQ, offers 50 health-related categories, from A.D.D. and Alzheimer’s Disease to Weight Loss and Women’s Health. Again, consumers are never apprised of the way their personal data—including intimate health-related information—is being sold to the highest bidder. 7. Audience Segmentation The division of consumers into much smaller affinity groups (e.g., Business Travelers, Sports Fans, Technophiles) for the purpose of targeted marketing is a longstanding advertising practice. Its use by pharmaceutical marketers, however, especially in the digital context, raises a number of critical issues. The segments into which pharmaceutical companies divide their audiences go far beyond demographic and lifestyle categories to include highly personal and sensitive information relating to one’s health. For example, as Mark Miller, senior vice president for healthcare marketer Epsilon, explains, “Segment profiling dimensions include (but are not limited to): market size, geo-demographic characteristics, medication usage, self-care behaviors, bio-metrics, insurance coverage/ usage, needs/attitudes/behaviors and media consumption.” The goal of these data collection and analysis efforts, moreover, is to influence consumer behavior in some of the most personal and profound decisions they will ever have to make, concerning their own and their family’s health. 8. Mobile Campaigns Many of the same consumer data collection, profiling, and behavioral targeting techniques that have raised concerns in the more “traditional” online world have now been brought into the mobile phone marketplace. As U.S. consumers increasingly rely on their mobile devices for a wide range of services, including sensitive transactions related to health, the expansion of behavioral targeting into the mobile world (where it will be combined with precise user and location data) is especially troubling. “Not only does Mobile have a ubiquitous presence—with us 24/7,” boasts Peter Nalen, CEO of Compass Healthcare Communications, “—it can also reach more people, more efficiently, and with greater targetability.” That’s not the kind of personalized service, however, that consumers may want or need in the healthcare arena. And that’s why CDD has called upon the FDA to remedy this situation, first by conducting a comprehensive investigation into the use and impact of digital-health marketing techniques and technologies, and then by working with the Federal Trade Commission and other appropriate agencies to develop a set of policies for regulating the use of behavioral targeting, data collection, and other digital techniques in the marketing of drugs and health-related products.
  • (Full Report - PDF (link is external) )(Brief Report - PDF (link is external) ) Written by Jeff Chester, Center for Digital Democracy, and Kathryn Montgomery, American University A report from Berkeley Media Studies GroupToday, U.S. children are confronting myriad diseases associated with excessive weight gain and poor nutrition. Type 2 diabetes, a serious medical condition previously found only in adults, has become common in children and adolescents. Government agencies and public health professionals have become increasingly concerned over the role of advertising in promoting "high-calorie, low-nutrient" products to young people. Most of the policy debate has focused on TV commercials targeted at young children. However, marketing now extends far beyond the confines of television and even the Internet, into an expanding and ubiquitous digital media culture. The proliferation of media in children's lives has created a new "marketing ecosystem" that encompasses cell phones, mobile music devices, instant messaging, videogames, and virtual, three-dimensional worlds. These new marketing practices are fundamentally transforming how food and beverage companies do business with young people in the twenty-first century.
  • Bush FTC Nominee a Triple Threat: To Media Diversity, Affordable Gas Prices, and Role of States Supporter of Plan to Remove FTC from Media Merger Review to Be Head of FTC Wyden, Boxer and Consumer Groups Express Concern 3 June 2004 Deborah Majoras, a former Bush administration Department of Justice official, who supervised the controversial settlement with Microsoft, is on track to become the chair of the Federal Trade Commission. Majoras, who represents some of the country’s largest oil and media companies, would become the federal government’s lead “consumer advocate.” But as Senators Wyden and Boxer and a number of consumer groups have made clear, Majoras at the FTC would be bad for consumers, competitors, and citizens alike. One major objection to Majoras is her stance on the role that the FTC should play in reviewing media mergers. She backed a secret plan developed by the Bush Administration in 2002 that would have removed the FTC from reviewing such mergers. Under the proposal, only the Department of Justice would have had media merger authority. DOJ has been notoriously friendly to the big media companies that lobby an administration (regardless of which party is in charge). Only at the FTC have consumers and competitors been given serious attention (as in the case of AOL and Time Warner, where the FTC imposed some “open access” and non-discrimination safeguards). As chair of the FTC, Majoras would be unlikely to seek review of media mergers, permitting the DOJ to rubberstamp even more consolidation. While at DOJ, Majoras also led the Bush administration’s backroom deal that approved a much-criticized agreement with Microsoft. The Majoras plan essentially left the computer giant intact, and cut off the crucial rule of the states in imposing more significant safeguards. Finally, Majoras has represented Chevron-Texaco and other major oil and gas interests, an area that the FTC is supposed to regulate. Senators Barbara Boxer (D-CA) and Ron Wyden (D-Or) have placed a “hold” on the nomination for now, pending assurances that Ms. Majoras will pursue an agenda designed to ensure a competitive gasoline industry. The Jones, Day law firm, where Majoras works in the government regulation/anti-trust division, represents some of the biggest media (and media-related) companies in the country, including: DIRECTV, General Electric Company,The Goldman Sachs Group, Halliburton Company, Kellogg Brown & Root, Knight Ridder, Lehman Brothers Holdings, Liberty Media Group, Merrill Lynch & Co., Procter & Gamble, R.R. Donnelley & Sons, Thomson Multimedia S.A., Time Warner, the Tribune Company, and the Washington Post Company. The firm also represents ICANN (Internet Corporation for Assigned Names and Numbers).
  • CDD's predecessor group, Center for Media Education, released this report in 1996. It played a key role generating support, at the FTC and in Congress, to enact the Children's Online Privacy Protection Act in 1998 (COPPA).