PMAL409: Business

Ethics
(24F-C-PMAL4V)
Learning Activity -7
Group - 1- Jaismeen Kaur & Pardeep
Kaur
Group -2 – Priya & Jasveer Kaur
Group – 3 – Bhanu & Neha
Algoma University
Brampton campus
Prof.: Jennifer Chung Brassington
Date: October 27th, 2024
 Introduction

The Legal and Ethical Dilemma

Legal Standards in the Pharmaceutical Industry

Merck’s Compliance Effort

Table of Ethical Considerations Beyond Legal Compliance
Contents Repercussions of Legal Non-Compliance

Suggestions for Ethical and Legal Coherence

Conclusion

References
 Introduction

Background:
• Vioxx, developed by Merck, was launched in 1999 as a
prescription drug for treating pain, specifically targeting
arthritis symptoms.
• Marketed as a breakthrough due to reduced gastrointestinal side
effects compared to existing pain relievers.
Success and Adoption:
• Initially received well due to efficacy in pain relief.
• Rapid adoption by both doctors and patients, making Vioxx one
of Merck’s most profitable drugs.
• Purpose of Slide: Provide foundational information for those
unfamiliar with the case, setting up the significance of the
subsequent ethical and legal challenges.
The Legal and Ethical Dilemma
Health Risks Discovery:
• Studies linked Vioxx to higher risks of
cardiovascular problems, including heart attacks
and strokes, especially in long-term users.
Balancing Compliance with Ethics:
• Merck had to consider if they should disclose
risks fully or focus solely on adhering to
minimum FDA requirements.
• Dilemma: Should Merck go beyond legal
compliance to achieve ethical transparency?
• Purpose of Slide: Introduce the central conflict
—Merck’s legal obligation to disclose
information against the ethical responsibility to
prioritize patient safety.
 Legal Standards in the Pharmaceutical
Industry
FDA Regulatory Requirements:
• Drugs must pass stringent safety testing, and any negative effects
must be tracked down and reported.
• To demonstrate effectiveness and detect any hazards, clinical trials
need to adhere to strict guidelines.
Corporate Social Responsibility in Pharmaceuticals:
• In addition to compliance, pharmaceutical corporations are in charge
of post-market surveillance to guarantee continued safety.
Compliance vs. Ethical Excellence:
• The ethical requirement of complete disclosure with patients and
healthcare providers contrasts with Merck's obligation to adhere to
FDA regulations.
Merck’s Compliance Effort
Initial FDA Compliance:
• Adhered to the established protocols for medication approval and risk assessment labeling.
• Released safety data in accordance with legal mandates, even though it might have reduced
cardiac risks.
Gaps in Compliance:
• Merck may have minimized cardiovascular risks in marketing and public comments, according to
mounting evidence.
• Possible inaction in the face of growing safety concerns, which could result in extended patient
exposure.
Result: In 2004, Merck recalled Vioxx as a result of growing cardiovascular risk evidence.
Ethical Considerations Beyond Legal Compliance
Values-Based The significance of an organizational culture that places a high priority
Leadership: on morality, openness, and public confidence.
Long-term safety and patient well-being would take precedence above
immediate financial gain in an ethical culture.
Impact on Management and staff had to balance the moral need to reveal health
Internal hazards with the company's economic objectives.
Stakeholders:

Implications Patients, doctors, investors, and the general public were among the
for parties impacted.
Stakeholders:
Repercussions  Settlements and Lawsuits:
o Many lawsuits from individuals and families impacted by health
of Legal Non- problems linked to Vioxx were filed against Merck after the
recall (Karha & Topol, 2004).
Compliance o paid billions in settlements, which had a negative financial and
reputational impact on the business.
 Impact on Finance and Reputation:
o Merck's stock price fell, and consumer confidence dwindled,
illustrating the long-term effects of putting profit ahead of
openness (Waxman, 2005).
 Industry-Wide Lessons:
o The Vioxx case served as a warning to the pharmaceutical
industry, highlighting the importance of openness and complete
risk disclosure (Solomon, 2009).
 Suggestions for Ethical
and Legal Coherence
 Developing Strength Transparency:
o When patient safety is at stake, businesses should give
transparent information about medication hazards first
priority, going above and beyond the bare minimum
required by law (Waxman, 2005).
 Promoting Ethical Leadership:
o Accountable leadership should foster a culture that
prioritizes long-term security over immediate profits
(Karha & Topol, 2004).
 Establishing Internal Review Procedures:
o In order to ensure that businesses are proactive in
patient protection, ongoing internal evaluations after the
market can assist in identifying problems early
(Solomon, 2009).
 Conclusion

 Summary of Findings:
o Reiterate Merck's early compliance measures,
ethical responsibility flaws, and the repercussions
of putting profit ahead of transparency in the
summary of findings (Karha & Topol, 2004).
 Important Takeaway:
o The Vioxx case emphasizes how crucial it is to
balance adherence (Solomon, 2009) to the law
with a dedication to moral principles in order to
preserve public confidence in the pharmaceutical
sector (Waxman, 2005).
 • Merck & Co., Inc. (2004). Vioxx: Information for healthcare
professionals. Retrieved from https://www.merck.com
• Karha, J., & Topol, E. J. (2004). The sad story of Vioxx, and
what we should learn from it. In The Cleveland Clinic
Foundation, Cleveland Clinic Journal of Medicine (Vol. 71,
Issue 12, pp. 933–934).
https://www.ccjm.org/content/ccjom/71/12/933.full.pdf
References • Waxman, H. A. (2005). The lessons of Vioxx — Drug safety
and sales. New England Journal of Medicine, 352(25), 2576–
2578. https://doi.org/10.1056/nejmp058136
• Solomon, D. H. (2009). Poison pills. Journal of Clinical
Investigation, 119(3), 427. https://doi.org/10.1172/jci38430
• Fischer, M. A., Stedman, M. R., & Linder, J. A. (2010). The
Vioxx story: Why drug safety must be the primary goal. Drug
Safety, 33(1), 1-9.
https://doi.org/10.2165/11530530-000000000-00000
Thank You