Placebos are often used in clinical drug trials to determine how well a potential drug serves its intended purpose (known as its efficacy). The basic setup of a placebo-controlled trial involves two different groups of subjects: one that receives the experimental drug and one that receives a placebo (which can either be an inert substance or an active drug, depending on the trial). These trials are usually double-blind -- meaning that neither the subjects nor the researchers know which group is receiving the experimental drug -- to avoid any potential bias. If researchers know that they're administering a placebo, they may convey doubts about its effectiveness to the subject.
If more subjects report a significantly better outcome with the drug than with the placebo, then the drug is generally considered a success (assuming it also meets other criteria, such as safety concerns). Placebos are most commonly employed when the experimental drug is one used for treating mental illness. The placebo effect is considered especially strong when testing these kinds of drugs, so it can be more difficult to determine if an experimental drug is actually working better than one already in use.
Recently, some researchers have begun to question whether the standard placebo-controlled trial is an efficient way to test an experimental drug. If the placebo performs better than the drug, does it really mean that the drug is ineffective? Not everyone thinks so. Dr. Ted Kaptchuk states that, "Often, an active drug is not better than placebo in a standard trial, even when we can be confident that the active drug does work." The reverse can also be true. In one placebo-controlled trial, the drug performed better than the placebo, so ordinarily researchers would conclude that the drug, a painkiller, is effective. The researchers then administered the painkiller to another group of subjects without telling them what it was, expecting another positive result. It didn't work to relieve their pain at all [source: Brooks]. Other studies have shown that some medications don't work as well when patients aren't told what they are or what they're supposed to do.
Some critics of the placebo-controlled trial state that they aren't really demonstrating a placebo effect, because many illnesses and diseases can resolve without any kind of treatment. They claim that it's wrong to attribute all positive outcomes to the placebo, and that in order to accurately measure the placebo effect in a clinical trial, you must have a third group of subjects that receive no treatment at all. However, some proponents of placebos believe that their effect can only be demonstrated in a healthcare setting, because subjects in clinical trials must be informed that they might receive a placebo.
The use of placebos in any setting is complicated to say the least. Let's look at the practice of doctors prescribing placebos next. It's more common than you might think.