By Caitlin Hoff and Steven Mintz
A company in any developed country today is expected by society to uphold certain ethical practices to benefit its consumers. Many believe consumers should be the company’s greatest priority when developing and manufacturing a product. Without customers, companies and manufacturers would not be able to make a profit. So, it’s understandable why consumers demand a safe product that brings them satisfaction. However, in the last decade or so, we have seen one consumer industry fail time and time again to uphold its ethical responsibility to its customers: the pharmaceutical industry. In an industry responsible for people’s health and well-being, how can a company’s ethics be slipping?
In 2010, the drug manufacturing company Boehringer Ingelheim released its FDA-approved blood thinner Pradaxa to market. Advertised as a better alternative to other blood thinners, Pradaxa, unlike its competitors, did not require any diet restrictions. This was a big selling point for the drug, but it was also a major safety hazard for patients. In the case of Pradaxa’s competitor, Coumadin (warfarin), patients have to restrict the amount of vitamin K in their diet as it is a natural antidote to the effects of the blood thinner. While this is an inconvenience, should a patient get injured and need an antidote to clot their wound, ingesting vitamin K would do the trick. Pradaxa, however, was prescribed and given to patients without a natural or synthetic antidote available. Needless to say, this lack of foresight and concern for patient safety led to over a thousand cases of serious bleeding, other adverse side effects and numerous fatalities.
In 2016, America again saw company profits being prioritized over customers’ wellbeing when Mylan Laboratories raised the price of their EpiPens by nearly 600% in less than a decade. A set of two EpiPens, sold around $100 in 200, now cost over $600. Mylan’s CEO, Heather Bresch blamed the price increase on American healthcare, and like many leaders of pharmaceutical companies before her, she explained that the profit made goes right back into research and development along with product marketing. Here is the catch, though. When it comes to Bresch’s story, epinephrine, the drug administered by Mylan’s patented auto-injector, is the same drug that has been used to treat allergic reactions for decades. We can criticize the ethics involved in the decision to raise the price of a drug that has not changed, but a greater breach in the company’s code of ethics is selling a life-saving drug at such an exorbitant fee that many Americans can’t afford to purchase a set of EpiPens.
Another price gouging incident occurred in 2016, when the CEO of Turing Pharmaceuticals raised the price its medication, Diaprim, by 5,000. Turing purchased the right to the prescription drug Diaprim, a life-saving drug that treats toxoplasmosis, an infection that affects people with compromised immune systems, particularly those with HIV/AIDS and some forms of cancer. Lacking competition for their drug, Turing raised the price from $13.50 per tablet to $750 per tablet, or an increase of 5,000. The reason given for the increase was to help the company fund its research work on toxoplasmosis, along with new education programs for the disease. Turing's CEO, Martin Shkreli, explained that it was a great business decision that benefited the company's stakeholders. Shkreli became the poster-child for hated corporate executives.
These are just two examples of the ways that many pharmaceutical companies in America have abused their power and undermined their ethical agreement with their customers in order to widen their profit margins. In many industries, should a product or company decision disappoint its consumer base, companies would react to the issue to keep their customers happy and loyal. In these large pharmaceutical megacorporations dealing in life-saving drugs, consumers take what they get and drug manufacturers rarely see penalizing repercussions for their questionable actions. Until these companies recognize their practices as unethical, it is up to consumers to blow the whistle on drugs with adverse side effects, demand safer approved products from the FDA, and call on their appointed legislators to reign in the power of drug manufacturers and other for-profit companies in the healthcare industry.
Putting corporate self-interests ahead of consumer interests is not new for business. We’ve seen it before in the irresponsible behavior of automobile manufacturers such as the Volkswagen (defeat device), Toyota and Lexus (unintended acceleration), the GM ignition switch that could cause the engine to shut off while driving, and air bag blowouts at Takata. In each of these cases, the corporation made a cost-benefit analysis to determine how best to deal with the safety issues. The problem here is it can morph into the philosophy, “the ends justify the means.” Ethics is not a means to an end but the end itself – to make things better. The means, or methods, a company uses to get to its goal is just as important as the goal itself. Abusing the public trust certainly is not acceptable behavior by a socially responsible company.
Blog posted by Steven Mintz, aka Ethics Sage, on January 18, 2018. Dr. Mintz is a Professor Emeritus from Cal Poly San Luis Obispo. His website provides additional information about his services and you sign up for his newsletter.