December 11, 2008

Jeff Perlman, Executive Vice President – Government Affairs
Clark Rector Jr., Senior Vice President – State Government Affairs
Robert Kohlmeyer, Manager – Government Affairs

PhRMA Announces Changes to DTC Guidelines

The Pharmaceutical Research and Manufacturers of America (PhRMA) board of directors has adopted changes to its Guiding Principles on Direct to Consumer Advertisements about Prescription Medicines. The voluntary guidelines provide direction on ways to ensure that DTC advertising is accurate, accessible and useful to patients. Among the changes are principles of identifying whether people appearing in ads are actual health care professionals, compensated celebrity endorsers or paid actors. The revised guidelines state that DTC television or print advertisements with adult-oriented content should be placed only in media where at least 90 percent of the audience is expected to be at least 18 years old. The new guidelines go into effect March 2009. Outgoing House Energy and Commerce Committee Chairman John D. Dingell, D-Mich., and Oversight and Investigations Subcommittee Chairman Bart Stupak, D-Mich., who have both been critical of DTC advertising in the past, said that the PhRMA revisions were a positive step, but not sufficient. "On one hand, PhRMA has taken our committee's concerns seriously by revising parts of their DTC code; on the other hand, some of these changes are merely a rewording of prior policy that does nothing to increase consumer protection," Stupak said in a statement. A full list of the changes is available here.
Back to Top

AAF Shows Support for Automobile Industry

The downturn in the national economy has had an impact on advertising in both obvious and subtle ways. The domestic automobile industry-Chrysler, Ford Motor Company and General Motors Corporation-accounted for $4.6 billion in advertising spending in 2007, or 3.3 percent of all measured advertising spending. This spending supports countless jobs in the advertising industry at local, regional and national levels. Because of the importance of automobile industry to our members, the AAF sent letters of support to members of Congress urging them to enact a federal assistance package for the industry. A copy of our letter is available here.
Back to Top

FTC Proposes Changes to Endorsement Guides

The Federal Trade Commission announced that it is seeking comments on proposed revisions to its endorsement guides. In its filing, the FTC said that proposed revisions will address endorsements by consumers, organizations and experts, and the material connections between advertisers and endorsers. More specifically, the proposed changes call for clearer disclosures when consumer endorsements do not reflect typical experience. Last updated in 1980, the Guides Concerning the Use of Endorsements and Testimonials in Advertising provide advertisers with examples and interpretations of the FTC Act. Comments will be accepted through January 30, 2009. The AAF expects to file comments. The full register notice is available here.
Back to Top

ICANN Proposes Nearly Unlimited Top-Level Domain Options

A proposal to drastically increase the number of generic top-level Internet domains could have serious implications for companies operating and advertising online. In laymen's terms, top-level domains are those that exist on the right side of the dot. The Internet Corporation for Assigned Names of Numbers (ICANN) currently issues domain names for individuals and groups within a limited number generic top-level domains, such as .com, .org, .net, as well as country codes such as .us, .ca, and .uk. ICANN plans to create and sell over 1,000 new top-level domains over the next three years, offering virtually unlimited options. Anticipated top-level domain names include business names, (for instance, .aaf, .google, .cocacola), product names (.corvette, .frostedflakes), and more generic terms (.soda, .newspaper, .televison). ICANN plans to set application fees for the new top-level domain names from $190,000 to $250,000 each. The AAF is concerned that this sweeping change will cause unprecedented consumer confusion, abuse, fraud and disputes. We are especially troubled by the potential for "cyber squatting" and the problems associated with profiting from other companies' brands and trademarks. We are working with like-minded organizations to urge ICANN to delay the rollout of this program until sufficient safeguards are in place to protect businesses, brand owners and consumers.
Back to Top

Rep. Waxman Named House Commerce Committee Chairman

Rep. Henry Waxman, D-Calif., will chair the powerful House Energy and Commerce Committee when the 111th Congress convenes in January. Waxman, the current chairman of the House Oversight and Investigations Committee, has long been a strong critic of advertising. Of note, he has called for stricter regulation of direct-to-consumer advertising of pharmaceuticals, tobacco advertising and product placement. Waxman challenged longtime Chairman John Dingell, D-Mich., who was ousted in a 137-122 vote. While Waxman has not yet set an agenda for the upcoming congressional term, it is anticipated that many advertising issues will face increased attention.
Back to Top

AAF Government Report will be published on a limited basis until Congress resumes legislative work in late January 2009.

AAF Government Report is available to all members of the AAF. If you are interested in receiving an e-mailed copy, please e-mail