The Influence of Free Samples on Healthcare Costs
Free samples in the medical sector are a common strategy to increase customer loyalty to a particular brand. Representatives of pharmaceutical companies, for example, can use free samples for an advertising campaign for new drugs or medical services (Schwartz & Woloshin, 2019). Thus, it can set up potential customers for a more positive attitude, which increases the rating and credibility of the organization. Free samples can have a range of impacts on various areas in the lives of individuals and healthcare companies.
Healthcare costs are one of the main aspects that must be well-regulated for organizations to provide skilled and affordable care (Schwartz & Woloshin, 2019). By allowing people to use the product before making a purchase, customers will be able to evaluate the benefits of the samples and their effectiveness and draw certain conclusions about their usefulness. Thus, the company spends certain funds on producing and distributing samples. However, this money can quickly pay off because a sufficient number of people can draw conclusions about the need for drugs and buy them after using free samples. This, in turn, allows for lower healthcare costs that may be incurred for hospitalization or prophylactic treatments.
Benefits of Free Samples
First of all, the free samples strategy can have a positive impact on profitability for medical and pharmaceutical companies. However, it can also have a positive financial impact on health system costs. Giving people free samples of expensive medicines can lead to doctors prescribing these drugs more often because they can be sure they work (Dirman, 2020). Thus, the number of patient purchases can increase, and, as a result, the profitability of the manufacture of medicines can increase.
Dangers of Free Samples
At the same time, this trend may hurt the costs of insurance companies that will need to cover more costly drugs. State insurance programs may be affected, as they will have to cover the costs of medicines. In addition, the distribution of free samples may reduce the purchase of alternative medicines that remain effective and could help people (Dirman, 2020). Patients will not use cheaper generics if they can get more expensive drugs. Thus, many pharmaceutical companies may suffer losses due to falling sales of their products.
Free samples can affect how doctors use prescriptive authority. Those physicians who receive free samples for promotional or other purposes are more likely to use them and recommend them to their clients. This may be due to ethical considerations, such as doctors feeling compelled to prescribe the drugs they have been given. Thus, it can significantly affect the principle of integrity and honesty by violating the duty of doctors to prescribe drugs they consider adequate (Schwartz & Woloshin, 2019). This can impact healthcare costs as the only beneficiaries of such a policy would be pharmaceutical companies that produce drugs and distribute them through doctors or pharmacies (Dirman, 2020).
At the same time, a large number of drugs will not be taken into account, which makes it impossible to promote alternative drugs and sell them. As stated earlier, this will cause the sales of various pharmaceutical companies to fall and may lead them into a difficult financial situation. However, given that brand-name drugs supplied with free samples are much more expensive, this can affect the financial situation of clients and clinics that provide treatment.
References
Dirman, A. (2020). Financial distress: the impacts of profitability, liquidity, leverage, firm size, and free cash flow. International Journal of Business, Economics and Law, 22(1), 17-25. Web.
Schwartz, L. M., & Woloshin, S. (2019). Medical marketing in the United States, 1997-2016. Jama, 321(1), 80-96. Web.