Life, health, and medicine are intertwined, and the pharmaceutical industry has played a leading role to confirm this assertion. The pharmaceutical industry has supplied drugs that have saved millions of people, cured various chronic ailments such as cancer, and helped in controlling diseases such as HIV/AIDS. However, the industry has not been immune to uncertainties, especially about its social responsibility. This paper presents a case study of PharmaCare, which is one of those companies that have been victims of these ethical issues. It will consider the emerging marketing strategy (Direct to Customer) adopted by the pharmaceutical industry to reach its clients from various locations.
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Furthermore, the paper will discuss the issue of compounding pharmacies coupled with how the Food and Drug Admini,stration (FDA) is handling it. It will also examine how PharmaCare has applied the United States’ intellectual law prope torties to exploit third world countries like Colbert. The paper will then recommend the measures that the company can take to become more ethical.
Ethical issues facing PharmaCare
One of the ethical issues relates to PharmaCare’s manufacturing facility in the African nation of Liberia. The ‘healers,’ who voluntarily share information about indigenous cures coupled with those that harvest plants, are given low remunerations. While the people in Colberia live in primitive huts, the PharmaCare executives live luxuriously, and the company is involved in environment degradation practices. Despite this development, the company has progressed with its activities in the country. In essence, PharmaCare is exploiting the intellectual property rights of Colberians.
Moreover, after discovering that one of their diabetes drugs was a good remedy for the Alzheimer’s disease, the company chose to start reformulating the drug fraudulently to maximize the effects behind the knowledge of the FDA. This move raised an ethical issue about regulation and product safety. compare, which was developed by PharmaCare to function as a compounding pharmacy, used the PharmaCare’s reputation, databases, networks, and sales and marketing expertise to propel it to the top of the market with a consistent increase in demand. Furthermore, CompCARE advertised its services and the presence of AD23 to consumers and marketed the drug directly to hospitals, clinics, and physicians’ offices, “even though compounding pharmacies are not supposed to sell drugs in bulk for general use” (Marriott, Wilson, Langley, & Belcher, 2010, p.82).
Another ethical issue arose when CompCARE progressed with the production of drugs even after mold was discovered in the air vents, which was likely to harm employees. The administration took no steps to remedy the problem. Subsequently, employees started experiencing health problems. Donna, one of the workers, developed chronic bronchial problems such that she could no longer report to work. Afterward, the company faced a series of charges. One of them touched on discrimination on the grounds of religion. Ayesha claimed that she had been denied promotion because she was a Muslim and she raised the complaint to EEOC. The director of operations promoted these fraudulent acts by encouraging employees to remain silent or leave the company. At the zenith of these ethical issues is that PharmaCare has continued to produce AD23 even after it was reported that the users of the drugs are suffering from heart attack episodes. Allen also started suffering from health problems that other employees were suffering from due to the mold in the air vents.
Direct-to-Consumer (DTC) marketing by drug companies
The US is among the few countries that have endorsed the use of direct-to-consumer advertising of drugs. Since its adoption, this strategy has raised several concerns. One of the popular concerns is that DTC may increase the expenditure on drugs by customers, the state, and insurers, but the benefits would not balance the expenses (Ventola, 2011). Moreover, advertisement of newly approved products may result in the consumption of drugs that possibly can bear some risks that had not been discovered during the initial drug approval process. The economic and health issues revolving around DTC started as early as the late 1990s when pharmaceutical companies enhanced their advertisements to include direct communication with consumers. Initially, pharmaceutical companies had focused their marketing on healthcare institutions and medical practitioners. Nonetheless, after the FDA introduced new regulations in 1997, the use of DTC increased as the pharmaceutical companies invested heavily to earn television airtime while advising customers to seek further information from their physicians.
Opponents have popularly argued that DTC advertising does not provide information in relation to alternative remedies, efficiency, and cost as it frequently provides erroneous information for the targeted consumers. Moreover, DTC tampers with the doctor-patient relationship, which increases the chances of a patient using the wrong prescription of drugs (Ventola, 2011). Nonetheless, the challenges of the application of using DTC cannot overshadow its benefits. It improves customer awareness on popular ailments, coupled with how they handle them. Consequently, this aspect increases patient empowerment in issuing about health. It also helps patients to comply with the prescribed drugs. Hence, if practiced subtly, DTC can turn to out to be of great significance. Nonetheless, if pharmaceutical companies do not follow the regulations provided by the FDA, it is likely to lead to detrimental results, as it was the case in PharmaCare.
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In November 2013, the Drug Quality and Security Act (DQSA) became law, and it contains an important provision about the regulation of compounding of drugs. It grants the FDA the power to monitor compounding pharmacies in line with risk-based guidelines. Moreover, it requires the compounding pharmacies to report the extreme effects of their products as well as any other relevant information. Moreover, the compounding companies must register with the FDA, for instance, as an outsourcing facility.
Compounding of human drugs refers to a procedure whereby pharmaceutical companies make drugs to cater to the personal demands of a patient (Marriott et al., 2010). Historically, the state played a central role in the regulation of compounding pharmacies. The FDA had a provision that required pharmacists to ensure that all drugs went through the New Drug Approval (NDA) process as a means of protecting the public from potential risks. Nonetheless, compounding drugs were excluded from the NDA, as they were meant to cater to specific patients.
This exclusion became an issue, especially following the 1992 discovery. Just like PharmaCare, the FDA discovered that some companies were using compounding companies to evade its provisions by producing drugs with compounding as a cloak. This realization prompted the FDA to use the Compliance Policy Guide that would permit the commencement of federal actions when the activities of a pharmaceutical company were suspicious. Part of the latter policy limited the volume of drugs that can be compounded in a given time (Marriott et al., 2010. Moreover, it prohibited pharmacists from compounding copies of what was already in the market.
However, the FDA’s efforts were challenged by the ruling made in Thompson v Western States  where the court invalidated the FDAMA arguing that it was unconstitutional based on the provisions of the First Amendment. The challenges gradually started vanishing following several cases. In 2005, the ruling made in Wedgewood Village Pharmacy v United States of America authorized the FDA to conduct general inspections and later it received more powers after the resurgence of the FDAMA in Medical Center Pharmacy v Mukasey  (Marriott et al., 2010).
Despite these developments, the FDA should be granted more powers to handle scenarios such as that of compare. The act ratified in 2013 – DQSA provides a good starting point by requiring all compounding companies to register with the FDA and further comply the manufacturing practices. On the other hand, the FDA should encourage healthcare institutions and physicians to purchase compounded products from registered outlets. However, the law should be made more stringent than it is currently. The registration is currently voluntarily, but it will serve better if made compulsory in a bid to monitor all pharmacies.
The doctrine of intellectual property has raised debates thanks to the new developments in technology, new issues to be protected, and the existing provisions of the International Intellectual Property Rights Laws. It has created opposing sides, viz. developing world’s opinions and developed countries’ opinions. Both parties have used various theories to explain their ethical stand. Conventionally, developed countries have played an important role in the development of drugs that save several lives across the world. Colberian is a perfect example whose knowledge in indigenous medicine has been exploited by PharmaCare. However, the pertinent question remains, is the pharmaceutical company justified to use Colberian intellectual property?
The established companies in the pharmaceutical industry control intellectual property laws in this field. Hence, intellectual property laws have been developed to protect modern health systems. This aspect discriminates on traditional medicine men. The traditional medicine men fail to prove how their indigenous knowledge complies with terms of intellectual protections. Nevertheless, where intellectual laws can protect them, the traditional medicine men are hampered by the costs of registering and protecting a patent. One of the arguments about intellectual property rights is based on the two-gap theory. The theory explains the obstacles that prevent developing countries from adopting various technologies (Shalden et al., 2013). It acknowledges that developing countries lack the capital to initiate and sustain their innovations.
If the third world countries established stringent intellectual laws, then they would be unable to create their technological foundation. Therefore, developing countries consider patents as obstacles. It thus follows that the peasants in Colberia are safer if they share knowledge with PharmaCare than if they do not, even though this is infringing on their intellectual property right. Intellectual property rights should safeguard the rights of people’s cultural inventions, innovations, and items. Nonetheless, the Western intellectual property laws seem to focus on shielding the economic exploitation of the indigenous knowledge by arguing that it is a means of encouraging creativity and exploration (Shalden et al., 2013). The American intellectual property laws are subject to manipulation by firms such as PharmaCare to initiate economic exploitation as well as cultural attrition.
The above notion must change. Individuals and communities should be rewarded for the products made from their intellect to motivate people to become creative. Therefore, PharmaCare can compensate Colberia and its natives in several ways. First, PharmaCare should minimize the cost of essential prescription drugs supplied to Colberians. Colbert is an impoverished nation, and most of its citizens would be thankful if they accessed medicines at a lower cost.
Moreover, indigenous healers should be rewarded appropriately for their work. Secondly, the company can initiate a research fund for chronic ailments in the country. Most developing countries suffer from chronic diseases such as HIV/AIDS, cancer, and diabetes, among others. These ailments have persisted due to the inadequate research, which is coupled with lack of funds. Thirdly, PharmaCare should offer education and training programs to the traditional medicine men on the contemporary developments in the pharmaceutical industry.
One of the companies that have faced legal technicalities similar to PharmaCare is GlaxoSmithKline (GSK), which is one of the largest multinational companies in the world. In June 2012, the company was found guilty of participating in fraudulent activities and asked to pay $3 Billion to exonerate itself from the criminal and civil charges. GlaxoSmithKline had been accused of supplying some prescription drugs without informing consumers of the dangers that the drugs posed. The federal government and certain states raised complaints based on the False Claims Act.
If the victims of the PharmaCare raise issues and file charges about the fraudulent acts that it has promoted, the company can face similar charges as GlaxoSmithKline under the False Claims Act. Moreover, it can be accused of contravening the provisions of the Drug Quality and Security Act 2013. Moreover, the company has endangered the lives of its employees and promoted religious discrimination in the workplace. Also, PharmaCare has exploited the people of Colberia economically while giving low remunerations. These issues amount to criminal as well as civil cases, which can lead to the payment of huge amounts in damages.
It is evident that PharmaCare has not lived up to its brand. Its tenet is to care about its consumers’ health, but that has not been the case, as discussed in this paper. It has paid no attention to the health of its employees. The workers have been suffering from bronchial problems and despite knowing the source of the problem; the company has made no steps to mitigate the issue. Indications show that AD23 causes heart problems to the users, but the directors have decided to remain mum on the issue. They are only interested in the revenues that they earn from the high demand for this risky drug. The company uses fraudulent means to ensure that its drugs reach the market. In line with these ethical issues, the company should register with the FDA so that it’s compounding of drugs processes are monitored. It should create a whistleblower policy so that employees such as the director who promotes fraudulent activities are reported and proper disciplinary measures are taken. Moreover, the company should raise the wages given to its workers back in Africa to motivate them in their work and ensure that all its operations are environment-friendly.
Marriott, J., Wilson, K., Langley, C., & Belcher, D. (2010). Pharmaceutical Compounding and Dispensing. Illinois, IL: Pharmaceutical Press.
Shalden, K., Guennif, S., Guzmin, A., & Lalitha, N. (2013). Intellectual property, pharmaceuticals and public health: access to drugs in developing countries. Northampton, MA: Edward Elgar.
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Ventola, L. (2011). Direct-to-Consumer pharmaceutical advertising: therapeutic or toxic? Pharmacy and Therapeutics, 36(10), 681-84.