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Corruption in the Pharmaceutical Industry
The health sector has always been faced with various challenges when it comes to the actions of pharmaceutical industries. There is a growing concern regarding the interests of physicians financial concerns and their relationship with pharmaceutical companies. This relationship has put patients in a very dangerous predicament, which has led to them dealing with several problems associated with addiction and withdrawals while the pharmaceutical companies enjoy large profits.
In 2013 the overall revenue for pharmaceutical organizations went from 10% to 42%, with a mean of 18%. Pfizer was at the highest point of the benefit rundown, and 4 different organizations (Hoffman-La Roche, AbbVie, GlaxoSmithKline, and Eli Lilly) had overall revenues of over 20%. To make a comparison, the net revenue of pharmaceutical organizations was more or less equivalent to that of banks, however the banks' consistency of profit was lower, from 5% to 29%. A report by Edmond Safra published on Harvard University Centre for Ethics website called The Pharmaceutical Industry, Institutional Corruption and Public Health reports that this financial relationship between physicians and pharmaceutical companies have at times created incentives which conflicts with the various developments in the sector. For instance, the relationship may lead to suppression of knowledge about drug safety which should be the priority for the promotion of public health and medical innovation. Additionally, the report adds that this mutual relationship has led to the public depending inappropriately on pharmaceutical firms to perform various medical activities an act which has led to corruption in the medical institutions (Safra).
These effects of corruption as a result of collaboration in the chain of drug distribution has led to various diverse effects to the society. In an analysis of the opioid crisis which has left various diverse medical complications in several American states, Barry Law Review highlights that OxyContin was introduced in American drug market as a prescription for opioid medication in cases of severe pain. However, its manufacturers Purdue Pharma felt that they could get extra benefit in terms of profits if they could make the drug proliferate into the American market in large quantity. Even though the manufacturer was able to acquire immense benefit in terms of profits, the reports asserts that the proliferation of OxyContin left behind a massive drug crisis which was about to become a pandemic because of its addictive nature (Childers, pg 62).
But why should physicians collaborate with pharmaceutical companies in administering harmful medicines to the public? A closer look to the question leads to various cases that have occurred in the recent past in regards to the situation. One of the major scenario was the lawsuit against Johnson and Johnson company in which the U.S Securities and exchange commission filed a lawsuit accusing the company of violating foreign corrupt practices act. In the case it was found out that the employees of Johnson and Johnson were involved in bribery cases of paying doctors to ensure that their products were the only ones being ordered and used in various hospitals and health facilities around Europe. It was also found out that the company had failed in implementation of proper control mechanisms which could detect and prevent corruption within the company itself and with other institutions and agencies (Rivest, pg 21).
Another case involving corruption between pharmaceutical companies and physicians involved Pfizer Pharmaceutical company. In 2012, the company was charged for bribing foreign doctors operating within their various subsidiaries in china and Europe to increase prescriptions of their medicinal products to various patients. Moreover, the company was further charged for obtaining regulatory approval for their medical products within various certified medical centers thereby hindering other pharmaceutical companies to supply their medicine too. It was also found out that the company had failed in coming up with an effective control system which would have been efficient in detecting some of the actions of their subsidiaries. For instance, the top management was not aware that various subsidiary managements were having false journal entries while at the same time they were lacking policies which could have been effective in anti-corruption compliance throughout their subsidiaries across the world (Rivest, pg 21).
The third case involved a lawsuit against Elly Lilly and co. pharmaceutical company. It is reported that in 2012, the company ensured that it had paid various foreign government officials to have a kind of monopoly in drug supply in various countries such as Brazil, china, Russia and Poland. These payments were found out to have been done illegally and in order for the various medical centers in those countries to just prescribe drugs supplied by them only. In the defense of the company, the top management claimed that they lacked proper verified intermediaries who would have informed them about government related businesses in the said countries. Moreover, the company lacked proper programs which could have aided in management of corruption across their subsidiaries (Rivest, pg 20).
Apparently these corruption cases involving pharmaceutical companies with medical facilities or physicians leaves one to wonder how they take place. In the modern world of advanced accounting strategies and government regulation strategies it should be assumed that these cases should not be taking place at all in the first place.
In trying to understand the main motive behind this mutual relationship Katie Zezima and Scott Higham through their article in the Washington post called Drug executives to testify before Congress about their role in U.S. opioid crisis, highlights some of the ways in which these cases come to take place. The article reports that these occurrences normally take place with the facilitation of pharmacy owners and drug distributors. Though it is obvious that the motives of these actions is to gain extreme profits on both ends, it was also found out that the practice has led to various medical consequences in the affected societies as a result of weak or low regulatory services from the government.
Additionally, a report by Adam Lusher in the Independent Newspaper found out that these corruption cases were taking place due to government turning a blind eye on them. He asserts that many countries are lacking commitments in terms of policies which should fight corruption and this has led to government officials minting money from the proceeds of the relationship between pharmaceutical companies and physicians. Moreover, the report adds that combating this sort of malpractice will continue to be difficult as long societies remain to be in acceptance of corruption (Lusher). For instance, bribery and corruption is the key channel which has allowed various companies to acquire manufacturing and supplying rights which has contributed to presence of sub-standard and falsified drugs in low and middle-income societies. The presence of corrupt officials in the government agencies has further made it easy for the corrupt pharmaceuticals to easily pass the regular Food and Drug Administration (FDA) test which normally focuses on quality of drugs entering the market.
Further report on the biggest impediment to the war against corrupt pharmaceutical companies is evident from a report by The South West Journal of Pulmonary and Critical care. Apparently there have been cases of the companies giving out money to various decision making organizations such as The Congress to allow them conduct some of their dirty businesses. The report highlights that money has been flowing across the hands of various congressmen so as to influence various hurdles such as FDA approvals to be favorable to the companies. Additionally, these favors from the companies to the congress may also be a platform to ensure there is an increase in prices of the drugs so as to enable the companies realize various profit levels. Some of the pharmaceutical companies mentioned in the report include Pfizer, Amgen, Bristol-Myers Squibb and Eli Lilly (Robbins, pg 117).
Despite the greater challenge in combating this gigantic issue of corruption in the pharmaceutical industry, it is possible to come out with solutions that may guide in combating the basic problems. The first step should involve various drug regulation agencies such as FDA to come up with various strict amendments. The agencies should ensure protection of consumers through formulation of strict policies which will lead to various repercussions for the pharmaceutical companies. For instance, the FDA should be strict in its approval process for the drugs being released in the market by companies (Childers, pg 75). Additionally, societies should come up with anti-drugs lobby which should be instrumental in taming usage of various drugs which may be profitable to and marketed by the pharmaceutical companies.
One of the most instrumental anti-drugs lobby group, Community Anti-Drug Coalition of America (CADCA) can be of great benefit to members affected by effects of usage of wrong drugs knowingly or unknowingly. In a report by Lee Fang called Anti- Pot Lobby Big Bankroll he highlights how individuals can come up together and bring a control to this supply chain between physicians and the companies.
Work cited
Rivest, P. Dominic. The prevention and detection of corruption in pharmaceutical companies. Pharmaceuticals Policy and Law 19 (2017) 17–31 DOI 10.3233/PPL-170451 IOS press.
Southwest Journal of Pulmonary and Critical Care. “Big Pharma Gives Millions to Congress.”
Volume 17 2018 Pg 117-118.
Fang, Lee. The Anti-Pot Lobby’s Big Bankroll. The Nation July 21-28 2014. Pg 13-18
Tracie Childers, The Opioid Crisis: The States/ and Local Governments' Response to Big Pharma’s Deception and Why the Supremacy Clause May Provide a Cloak for Opioid Manufacturers to Hide behind, 24 Barry L. Rev.59 (2018).
Safra, J. Edmond. The Pharmaceutical Industry, Institutional Corruption, and Public Health. Centre for Ethics Harvard University 2019. Retrieved from https://ethics.harvard.edu/pharmaceutical-industry-institutional-corruption-and-public-health
Lusher, Adam. “Big Pharma and Governments Are Turning a Blind eye to Corruption.”
Zezima, Katie, and Scott Higham. "Drug executives to testify before Congress about their role in U.S. opioid crisis." Washington Post 12 Apr. 2018. Business Insights: Essentials. Web. 27 Apr. 2019. Retrieved from
http://bi.galegroup.com.rlib.pace.edu/essentials/article/GALE%7CA534348753/f96cdb84131a05076d157980c401aa6e?u=nysl_me_pace