Blog Post

Will New Regulations Kill Pharma Ads On Google?

Google (NSDQ: GOOG) executives have singled out health as an ad category that has been performing well. “Health, for example, has seen strong growth in the U.S. and it’s now one of our largest verticals,” Jonathan Rosenberg, Google’s senior vice president for product management, said in his introductory remarks on the company’s earnings call Thursday.

But government scrutiny is threatening that golden goose, and Google may have to get creative to figure out a solution. Earlier this month, the Food and Drug Administration warned 14 major pharmaceutical companies that their search-engine ads were misleading, largely because of their brevity. Unlike more traditional ads, the FDA said the online ads failed to include risk information and often simplified, into short phrases, the types of ailments for which the drugs could be used. The FDA ordered the pharmaceutical companies to stop running them.

Asked by an analyst about the impact of the FDA’s warnings, Rosenberg said, “We are working with the advertisers to try to figure out how to get their ads in compliance, and that