• by Michael Parkes , Op-Ed Contributor, December 10, 2024

The digital advertising landscape is undergoing a seismic shift. Recent legislation, such as Washington State’s My Health My Data Act (WMHMD Act), is forcing advertisers, particularly in the pharmaceutical industry, to reevaluate their data-driven strategies. This new era of stringent data privacy regulations presents both challenges and opportunities.

At the heart of this shift lies a fundamental tension: the desire for personalized, targeted advertising versus the growing public concern over data privacy. Consumers want relevant ads, but they also want their personal information protected. For pharma advertisers, this means balancing the need to reach specific patient populations with the obligation to respect individual privacy.

The WMHMD Act sets a precedent for stricter data handling practices. Its key provisions, including explicit consumer consent and robust de-identification standards, signal a broader trend toward increased regulation. But it doesn’t have to mean an end to tailored messaging based on a person’s health needs or concerns. It means, as more states and countries adopt similar laws, pharma advertisers must adapt to a more privacy-centric approach. 

Expect More Regulation Ahead

Washington’s regulation is the proverbial canary in the coal mine and is part of a broader trend, with states across the U.S. enacting or considering similar regulations which result in tightening control over the use of health data in advertising. The Federal Trade Commission (FTC) has taken an active role in enforcing privacy standards. High-profile cases, such as the recent settlements with GoodRx, BetterHelp and InMarket, underscore its commitment to holding companies accountable for mishandling sensitive data. These cases signal that both state and federal agencies are prepared to address privacy violations aggressively.

As RFK Jr. steps into a pivotal role at the Department of Health and Human Services (HHS), there will likely be increased focus on data privacy at the federal level that could reshape the industry's approach to targeted advertising. State-level frameworks like Washington's My Health My Data Act are setting the stage for sweeping national changes.

A Privacy-First Path Forward

The advertising industry is at a critical juncture. To thrive in this new landscape, pharma advertisers need to consider new strategies and transition from audiences created using ‘de-identified’ health data that is directly linked to pseudonymous data like Advertising IDs, to privacy-preserving alternatives. Emerging solutions offer practical pathways to compliance:

1. Curation: The emergence of ‘Advanced’ Curation enhances this increasingly popular tactic, helping to increase both efficacy and scale comparable with legacy audience targeting in a privacy compliant manner.

1. Data Cleanrooms: These secure environments facilitate data collaboration with enhanced control over data access. Specifically, cleanrooms can provide restricted access to statistics derived from data without granting access to the data itself, making re-identification technologically impossible.

2. Zero-Party Data: Some publishers now offer an opt-in model where users explicitly consent to the use of their health data for personalized advertising. This voluntary approach not only respects consumer privacy but also creates a compliant framework for personalized engagement.

Pharma advertisers will need to embrace new strategies to not only comply with regulations but also build stronger, more sustainable relationships with their customers. As the regulatory landscape continues to evolve, a privacy-first approach will be essential for long-term success.

The future of pharma advertising is undoubtedly complex. However, by understanding the challenges and opportunities, advertisers can navigate this new era and emerge as leaders in the industry.