Who cares about a label? The effect of pediatric labeling changes on prescription drug utilization

Off-label drug use is common, particularly in pediatric populations. In response, legislation requires and/or provides financial incentives for drug manufacturers to perform pediatric clinical trials. Using New Hampshire’s all-payer claims database, we examine the impact of subsequent changes to drug labeling on pediatric drug utilization. To separate changes in utilization induced by labeling changes from other temporal factors, we estimate difference-in-differences models that compare utilization trends for pediatric patients to those of adults. We estimate that establishing safety and efficacy increases a drug’s market share by (a statistically significant) 2.8 percentage points, whereas failure to do so decreases a drug’s market share by (a statistically insignificant) 0.9 percentage points. We then interpret these estimates within the context of public and market incentives to conduct pediatric clinical trials.