See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/308399224

Ethical challenges in the pharmaceutical industry

Article  in  Pharmaceuticals Policy and Law · April 2012

DOI: 10.3233/PPL-120349

CITATIONS READS

0 1,547

1 author:

José Luis Valverde

University of Granada
81 PUBLICATIONS   48 CITATIONS   

SEE PROFILE

Some of the authors of this publication are also working on these related projects:

Toward the harmonization of the pharmaceuticals liability systems View project

All content following this page was uploaded by José Luis Valverde on 21 September 2016.

The user has requested enhancement of the downloaded file.

Pharmaceuticals Policy and Law 14 (2012) 123–127 123
DOI 10.3233/PPL-120349
IOS Press

Editorial

Ethical challenges in the pharmaceutical industry

The conflicts of interest involving physicians, in relationships with the pharma-
ceutical industry, in the past ten years have known extraordinary regulatory activity.
The American College of Physicians and the Accreditation Council for Continuing
Medical Education issued guidelines regarding physicians’ interactions with drug
companies. The Pharmaceutical Research and Manufacturers of America, adopted a
broad Code of conduct. In the same line the Office of the Inspector General of the
Department of Health and Human Services released a set of guidelines with which
manufacturers were urged to comply in order to guard against the risk of liability. A
body of federal law dealing with “fraud and abuse” is being used by prosecutors to
punish pharmaceutical companies and physicians involved in marketing.
There are a growing realization, of the troubling influence that pharmaceutical
marketing can have on patient care. The Medicare program “The prescription-drug
benefit”, shows a widespread concern about the costs and the reaction of federal
prosecutors for increase public expenditures. Thus, the law has begun to annex
terrain previously controlled by professional ethic. These changes place new ways
in which federal fraud-and-abuse law is being used, and the effect of those changes
on relationships between physicians and pharmaceutical companies indicate that the
trend will likely be intensified.
Drug liabilities become more frequent, more publicized, and more costly. They
impact patients’ perception, physicians’ practice, clinical research, and medical com-
munication.
Thorough review of the literature and newspapers indicates that the perception of
ethical issues in the pharmaceutical industry is largely negative and highlights the
scrutiny placed on pharmaceutical companies.
The most prominent issues reported are drug safety, pricing, data disclosure,
importation, clinical study design, marketing restrictions, DTC advertising, animal
testing, international market, developing countries, issues related to vaccines, growth
of drug counterfeiting, the cost effectiveness of treatments, and in the last ten years
the Pharmaceutical fraud.
Although individuals and most governments alike see health as a priority and
access to health as a right, 80% of the world population has no or very little access
to medicine.
Pharmaceutical companies are often the focal point of hostility because they are
one of the most well-known components of healthcare delivery. Other components
of health care delivery are payers, policy makers and providers, like doctors and
hospitals, who have also been accused in the literature of ethical transgressions.

1389-2827/12/$27.50  2012 – Network of Centres for Study of Pharmaceutical Law. All rights reserved
124 Editorial

From one perspective, the pharmaceutical industry is a vital industry not only
because of its economic significance but also because of its impact on the health and
well-being of people of all ages and economic levels.
Drug safety emerged as a predominant issue. Includes concerns about the com-
prehensiveness of reporting of all side effects observed during a clinical study. This
issue dominated the newspapers; undoubtedly tied to allegations about Vioxx, Bextra
and related drugs. This issue has important ethical consequences because it suggests
deception and lack of integrity, conflict of interest, and lack of ethical responsibility
to the patient as stakeholder to provide a sound product.
Concerns about drug pricing have been covered extensively in the literature and
newspapers. The pricing issue raises questions about sound management regarding
meaningful R&D costs and the public perception of wasteful advertising. Thus, the
ethical concern of just prices for drugs is of prime importance.
Data disclosure it is other frequently identified issue. Some articles called for
enforcement of a mandatory national drug registry of clinical trials. Another area
of attention in the literature concerns clinical data, the link between science and
business. Clinical data must support the approval for sale of new drugs.
Another issue is patent exclusivity and the opposition of pharmaceutical companies
to any actions that could make additional sources of product available before patent
expiration, resulting in restricted patient access to drugs.
Importation/reimportation, focuses on importing or reimporting drugs, primarily
from Canada. It is one attempt to circumvent the high price of drugs. Efforts to
legalize reimportation or circumvent the existing ban are commonly reported. The
clamour for legislation to permit Americans to buy lower-cost prescription drugs
from Canada will grow.
When pursuing clinical research, companies have to comply with a number of
ethical concepts and standards including the protection of the people involved in the
study as well as a commitment to scientific objectivity.
Objectivity has to be ensured when conducting clinical trials. The attention given
to the design of the clinical trial is a step in the right direction and so is the suitable
payment of research participants.
Further to the issues mentioned above, the context of paediatric medicine is even
more sensitive and prone to issues of ethics.
Recently appear new challenges. The pharmaceutical industry has to be very
transparent in the way it conducts genetic research, as well as on the implications that
this type of research has and alleviating fears about the potential misuse of genetic
information and data.
Once a drug is developed, it needs to be marketed and needs to be prescribed.
The main issue is the price and the interactions that the company can have with the
governments in order to set the levels of reimbursement, coverage etc.
Sales and marketing practices in the industry are areas of potential ethical transgres-
sion such as providing gifts or incentives to physicians, promotion of drug benefits
 Editorial 125

or off-label use of an approved drug. As primary interfaces between pharmaceuti-

cal companies and patients, physicians are the target of marketing and sales efforts.
These marketing and sales practices are costly and can add up to more than what
some companies spent on R&D.
DTC advertising is an area of particular concern due to its potential to mislead
patients. Banned until 1980, the use of DTC advertising by pharmaceutical companies
has increased, though there are guidelines to advertise on television.
Other challenge are the problem of counterfeit drugs. Counterfeit drugs are a
growing concern affecting the developed and the developing world. In terms of the
risk incurred by companies, a counterfeit drugs distribution under a brand name can
have serious effects on the company reputation.
Animal testing is a very vivid debate amongst the pharmaceutical industry, animal
welfare NGOs, society at large, and even investors. The topic of testing of drugs on
animals is one that the industry has to handle with great care.
Although science and technology have evolved, testing on animals still provides
information on how a drug interacts with a living body and is regarded as a critical
step, before testing on humans can be carried out. Simulations and alternative
technologies do not give all the data necessary to carry the clinical trials further.
Other topics that received significant newspaper coverage are the relation whit the
developing countries and efforts to provide access to patients and issues related to
vaccines as bird flu.
The cost effectiveness of treatments has become a major issue. In an effort to
tackle ever increasing health expenditure, regulatory are increasingly using Health
Technology Assessment (HTA) to assess the cost-benefit ratio of treatments and
decide whether a drug should or should not be covered by a country health system.
The strong dependence of the industry on decisions from health authorities and
government decisions therefore has an impact on pharmaceutical companies. They
must demonstrate good behaviour in order to be allowed to market their products,
particularly in countries where drugs are covered by publicly financed health insur-
ance.
Corporate Social Responsibility for the European Commission views are “a con-
cept whereby companies integrate social and environmental concerns in their business
operations and in their interaction with their stakeholders on a voluntary basis”.
Pharmaceutical companies need to take action to address the negative impression
about them notwithstanding the tangible commitment they make to healthcare, in-
cluding R&D expenditures that represent about 17.7 percent of domestic sales in
USA, more than the NIH and the international pharmaceutical industry combined.
The codes for Corporate Social Responsibility need one profound revision.
Overall are business decision- making linked to ethical values, compliance with
legal requirements and respect for people, and transparent business practices which
will contribute to sustainable business success and, more widely concerns for all
stakeholders. CSR goes beyond legal obligations. Appears to be evidence that the
126 Editorial

trust that consumers/patient put in companies is related to the firms behaviour and
perceived ethics.
The pharmaceutical industry is, by nature, a sector where the ideas of corporate
involvement, responsibility towards patients, ethical behaviour and an overall duty
towards society are omnipresent.
The need for R&D and innovation is great, maybe greater than ever. Populations
are rising, and on the whole, aging. People are living longer and rightly expect
appropriate care all along their life. Research and development (R&D) remains
a primary necessity in the pharmaceutical sector. The pharmaceutical sector has
and feels a responsibility in discovering, developing and delivering medicines and
vaccines that can make a difference in people’s lives and create a healthier future.
There are too a number of issues at stake when it comes to Orphan drugs.
Access to healthcare is a major issue in the pharmaceutical sector. The responsi-
bility of the industry is to work with institutions in order to design schemes that will
allow most to access healthcare regardless of their revenues, the country they live in
etc. Companies, as part of their CSR activities, need multiplied action by donating
medicines to populations in need, by proposing preferential pricing in the world
poorest countries in an effort to help fighting diseases such as AIDS and malaria or
in supplying vaccines to international NGOs or UN agencies at preferential prices,
below those practiced on developed countries.
In Europe, companies focus their sponsorships on humanitarian assistance (HIV/
AIDS, Human Rights, Public Health, Social issues) which culturally is highly valued
in corporate philosophy.
Pharmaceutical companies often set up Foundations, in order to support, edu-
cate and better address a disease for which they provide treatment. For example a
Foundation on diabetes if the company provides insulin treatment; or a Foundation
which focuses on AIDS education in Africa for a company providing anti retroviral
drugs etc. This effort will be in relation of other privates initiatives as the Bill Gates
Foundation.
One way to help the patient/consumer understand the issues the industry faces and
reaffirm the industry’s contribution to healthcare delivery is by to greater transparency
and more willingness to address key issues.
The overriding ethical challenge for the pharmaceutical industry is to serve the
well-being of the patient, and then to convince the public that that is precisely what it
set out to do. To now the real purpose and objectives of the pharmaceutical industry
will be very important for the public and for the industry.
US produces more new drugs “than any other country because it is largely free
of price controls . . . About 75 percent of all new drugs are discovered and used in
the US first”. Innovation and patients will get hurt if the emotional appeal for price
controls is heeded.
The ultimate ethical goal in the pharmaceutical industry is to discover and develop
safe and efficacious drugs that allow patients to live longer, healthier and more
 Editorial 127

productive lives, while making a profit to reward shareholders and to invest in research
for the next generation of medicines.
The pharmaceutical companies invested more than $50 billion over the last 30
years to discover and develop new medicines. Furthermore, studies confirm the
inherent risk of those investments.
An encouraging note is the pharmaceutical industry’s recognition that general
business ethics are critical to its long-term sustainability.
This situation has implications for executives in the pharmaceutical industry.
Newspaper and articles coverage is largely negative and highlight the scrutiny placed
on pharmaceutical companies.
Pharmaceutical companies are no different from other companies. Could exists
conflicts between ethical standards and profits. But the pharmaceutical industry is a
sector where any activity that could be detected, suspected or labelled as unethical
behaviour is not tolerated by patients, the media and stakeholders at large.
The need for strong and effective corporate governance might be emphasized in
the pharmaceutical sector by the fact that pharmaceutical companies, have a strong
impact on human health, and are seen as having a “duty” to provide a steady supply
of medicines.
Transparency is an attribute that is expected from a pharmaceutical company at
every stage of its operations. Transparency is indeed expected in terms of corporate
governance, political contributions, lobbying and financial disclosure and executive
compensation. This issue is relevant to the pharmaceutical industry in the sense that
the worlds top 50 companies are nearly all listed on trade exchanges and therefore,
there is a need for transparency from these companies to address the shareholders
need for information and maximum return on their investment. The pharmaceutical
industry is a long-standing, well structured sector with a strong impact on society in
general. It is an industry that is uncompromisingly expected to behave ethically and
provide treatments for all. As such, it is under very tight pressures and scrutiny from
legislators, NGOs, media and the public at large. It is also a sector that has become
very competitive.
Pharmaceutical industry urgently needs to eliminate internal misconduct in some
executives and reaffirm before the society his real commitment, as always, for the
innovation and the progress of the therapeutic in benefit of the humanity.

Prof. José Luis Valverde

Editor in Chief
Copyright of Pharmaceuticals Policy & Law is the property of IOS Press and its content may not be copied or
emailed to multiple sites or posted to a listserv without the copyright holder's express written permission.
However, users may print, download, or email articles for individual use.

View publication stats