Ethics of Offshoring: Novo Nordisk and Clinical Trials In Emerging Economies

Offshoring is a highly debatable topic throughout the country and the world. Many people base their opinions on different aspects of offshoring. Some people are against offshoring because they feel as if the working conditions in other countries aren’t up to par and are unethical. Some people are against offshoring because they feel it is taking jobs away from people within their own country. Some people are for offshoring because they feel there is greater profit involved or that they can get harder workers in other countries. No matter what side of the debate, everyone can agree on a few things like there needs to be better standards for working conditions, proper safety measures, and high economic and ethical concern. The case Ethics of Offshoring: Novo Nordisk and Clinical Trials in Emerging Economies was a highly informative case on clinical trials and offshoring. There was a reporter who wanted to speak with Anders Dejgaard, chief medical officer of Novo Nordisk, about his take on the offshoring of clinical trials by Danish companies as there had been multiple reports about trials being conducted in developing countries under unethical conditions. When reading the case, it truly made me consider aspects that I had never considered before. There are a few underlying questions that I feel need to be discussed.
First of all, when considering both economic and ethical aspects, is it appropriate for companies like Novo Nordisk to conduct clinical trials in, for example India? What exactly are the principles that should guide such a decision? According to amednews, “The average American income is $47,000 a year -- 16 times what the average Indian takes home, according to the CIA World Factbook. There is one doctor for every 384 Americans, while there are 1,667 patients for each Indian doctor, the World Health Organization says. The average American patient consumes nearly $7,000 in medical care each year; the average Indian's annual health care tally is $39. Nearly every American adult can read, but 39% of Indians are illiterate”. Also, the case mentioned how it costs so much more in the US to track the progress of a single person’s clinical trial than it does overseas. While the price of developing a single drug has raised substantially, it is easy to see why pharmaceutical companies increasingly are shifting clinical research to developing countries such as India. Economically, it does make sense for companies like Novo Nordisk to conduct clinical trials in places like India. Below is a table that shows an increase in offshoring pharmaceuticals (amednews). | United States | Western Europe | Rest of World | 1997 | 86% | 9% | 5% | 1999 | 80% | 9% | 12% | 2001 | 77% | 10% | 13% | 2003 | 70% | 11% | 19% | 2005 | 62% | 13% | 25% | 2007 | 57% | 14% | 29% |

It is easy to see why economically a company would want to do their clinical testing by using offshoring, but what about ethically? Before reading this case and learning all of the facts, I would have said it was fine for clinical trials to be conducted in places like India. In the case it said that a mother in India with three children is not a good test subject. The woman needs money to feed her kids, so she would be unable to refuse the test. I can agree with that. Just that little bit of text alone was powerful enough for me to start thinking. Therefore I do not think it is ethically responsible to conduct trials in poor economies with poor people who cannot refuse. Like our case stated, these tests should be held for the people with the resources to say no if they wanted to. Unfortunately, like the table above shows, there has been a huge increase in offshoring. Novo Nordisk had everything in place, for example, they would not test in areas they were not thinking about selling their products. They also have adapted all guidelines and recommendations by all the professional bodies. Their tests are conducted on people with ailments the drug would be used for too. These are the types of principals that I think should guide the decision as to whether or not it is appropriate to offshore to places like India. Another question that needs to be addressed is if trials are conducted in an emerging economy, how should they be managed and which standards should apply? I think medical ethics is a big issue when it comes to trials being conducted in an emerging economy. One famous incident of this was the Tuskegee syphilis study. This study left 400 African Americans untreated in order to research how they obtained the disease. The cure for syphilis, penicillin, had already been found in the 1940s. To prevent this from happening again, professional medical organizations developed guidelines and principles of ethics to guide their research, notably the Helsinki Declaration. I believe Novo Nordisk does a great job of adhering to these guidelines by putting safety measures in place. Emerging economies like India and China are attractive places to have clinical trials because of how much cheaper it is, the willingness to try new things as an emerging economy, and because a possible lack of standards. Novo Nordisk only conduct trials in countries where they have affiliates with necessary competence to arrange and monitor the trials. Also, they conduct clinical trials globally to test the safety and efficacy of new drug candidates in order to obtain global marketing authorization. These trials always have the same standards at all trial sites. The standards in which trial sites are selected include the quality of regulatory authorities, ethical review processes, and medical practices. In my opinion, these are the standards that should apply when considering to conduct a trial in an emerging economy.
What interest groups are joining the public debate and why? One group that joined the debate in 2008 was the FDA (European Parliament). They published a regulatory change ending the need for clinical trials conducted outside of the US to comply with the Declaration of Helsinki (European Parliament). While this group loosened the standards, many groups like Oxfam International, Health Action International, and the Dutch organization WEMOS are trying to tighten the standards by following the guidelines of the Declaration of Helsinki (European Parliament). One of the key issues involves stakeholders of companies. According to the case, stakeholders are an integrated part of their business philosophy. Stakeholders can be NGOs, policy makers, CABs, among others. The case states that “by involving stakeholders in the decision making process, decisions are better founded and solutions more likely to succeed.” Stakeholders are important due to the fact that they can affect, or be affected by company activities. How should businesses handle them? Well, as Novo Nordisk believes, corporate sustainability is essential. As surveys indicate, businesses ethical behavior is the number one driver of reputation for pharmaceutical companies. Businesses perceived to be unethical will lose business. Novo Nordisk envisions engagements where stakeholders are not just used to legitimize corporate decisions, but instead the foundation for how it conducts business. As the case says, “it is about innovation, opportunity, and planning for the long term.’ What is the role, respectively, of Danish, European, American and host country authorities and ethics committees in this process? Each country has a different role. America has 5 of the top 10 ethical pharmaceutical companies in the world (European Parliament) whereas Europe has only 2. It is the role of each to ensure that practices are being held to the highest standards that agree with the Declaration of Helsinki. Like Novo Nordisk, ethical committees call for them to put their patient before science or money. There are a number of groups, each wanting different things, but most importantly, I believe ethics need to be at the forefront of this entire debate.
This brings me back to the original issue in this Novo Nordisk case. How should Anders Dejgaard react when the journalist calls to discuss Novo Nordisk’s practices, and what do you feel is the most effective way to deal with the public? After reading all of the safety measures and the strong ethical stance that Novo Nordisk has throughout this case, I believe it would have been in Anders Dejgaard’s best interest to speak with the journalist. He could tell them how they have adapted all guidelines and recommendations by all the professional bodies. He could also mention that tests are conducted on people with ailments the drug would be used for. Also, they conduct clinical trials globally to test the safety and efficacy of new drug candidates in order to obtain global marketing authorization. Any time you get the opportunity to kind of “clear your name” I think you should take it. I think by doing that the public would have had a positive public image of Novo Nordisk. That is why I think the best way to deal with the public is through favorable media attention. In my opinion, Novo Nordisk has a strong moral compass and should not be shy when talking about their standards and practices.

Work Cited 1. O’Reilly, Kevin B. (2009, September 7th). Outsourcing clinical trials: Is it ethical to take drug studies abroad? American Medical News. Retrieved 09/14/2013 from amednews.com. 2. Schipper, Irene. (2009, March). Clinical Trials in Developing Countries: How to Protect People Against Unethical Practices. European Parliament. Retrieved on 09/14/2013 from www.edctp.org.