OBJECTIVES: 1) To understand why naltrexone, a medication approved by the FDA to treat alcoholism, has not diffused widely and 2) to demonstrate the use of stated preference techniques for predicting physicians' demand for medications with various characteristics. METHODS: Survey of 1372 physicians specializing in substance abuse treatment (65% response rate). Questions about the use of naltrexone and perceptions of naltrexone. Stated preference questions in which physicians are asked to select medications for treating alcoholism based on hypothetical medication characteristics. Combined actual and stated preference data are used to examine the accuracy of stated preference data for forecasting demand for new medications. RESULTS: Only 2% of physicians had never heard of naltrexone, 11% had heard of naltrexone but were not confident in their knowledge about its indications. The mean percent of alcoholism patients prescribed naltrexone was 13%. 37% of physicians did not prescribe naltrexone to any of their patients. When physicians were asked the main reason that they did not prescribe naltrexone to more patients the following reasons were given: 19% said "patients refused to take or comply with medications;" 17% said "patients could not afford medications;" 11% said "small effect size relative to side-effects;" 10% said "patients were not in a formal treatment program." Other analyses will also be presented that examine ratings of efficacy, side-effects, and compliance with naltrexone relative to other more widely used medications. Physicians demand curves and market-share for alcoholism medications are estimated using stated preference data. CONCLUSIONS: Although naltrexone is familiar to most specialists in substance abuse it is still not widely prescribed. A variety of reasons explain why naltrexone is not more widely prescribed. Efforts to increase its use will require efforts focused on a number of areas, including educating physicians and increased availability of the medication outside of formal treatment programs.