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Legal and Ethical Considerations

In: Business and Management

Submitted By kellie
Words 2085
Pages 9
Legal and Ethical Considerations in Marketing, Product Safety, and Intellectual Property
Kellie L. Plowden
LEG 500
Doris Mitchell
December 12, 2013

Everyone knows that direct- to consumer-marketing is focused on the patients. There are a lot of ways to get the attention of these patients. Advertising can be done through social media, print, radio, television, and word of mouth. “Prescription direct-to-consumer advertising has become a highly scrutinized and researched topic in healthcare marketing,” (Rollins, B.L., King, K. Zinkhan G., & Perri, M., 2011.). Banning direct-to-consumer would be very beneficial. The reason is because of the misconception and manipulation that it can cause the public. Especially when the elderly began focusing on what is being said. “The PhRMA “Guiding Principles” say that DTC ads should foster responsible communications between patients and health care professionals to help patients achieve better health.” (Stange, K.C., 2007). However, manipulating the public by distributing placebos to one group of people and the actual drug to another group of people is a bad way of communication. People who are on the state boards regulate compounding but the federal also has a part in it. According to Roth, “The FDA’s Office of Criminal Investigations (OCI) is working to monitor the schemes that have been going on with the compounding pharmacies.” Even though the FDA is aware of how law resources are needed, and how to direct the compounding pharmacy industries, I believe that they should be more involved when it comes to compounding medication due all of the meningitis cases that are arising. Companies are still challenging the FDA right to conduct an inspection of their facilities and also full access to their records. When states and some consumers reach out to the FDA for assistance, I believe that they should be able to work with U.S. Marshals and the U.S Marshals should support the FDA’s inspectors. If they support them, the inspectors will be able to conduct a thorough inspection without any problems. Not only would this power give FDA the authority, this would also help them control the compounding pharmacies that mislead drug promotions.
Marketing to hospitals, clinics through compounding pharmacies, and doctors is how PharmaCARE and CompCARE promoted their pharmaceuticals. It did not bother them that they were at risk and that the FDA did not approve of this. Companies are not supposed to use sales methods when it comes to prescribing the medications to direct consumers; however they market these medications anyway. The FDA should have been able to avoid PharmaCARE/CompCARE for using this marketing strategy by conduction an investigation observation report, which is called the FDA form 483 or just “483”, (Hamburg, 2013). “This report could have identified the pharmacists reformulating PharmaCARE/CompCARE’s best seller diabetes drug which was called AD23. This report could have also identified the fake patient records that doctors provided, the mold in their “clean room”, the consumers suffering an alarming rate of heart attacks, and the employee working conditions,” (Strayer 2013) Ethics are very important when it comes to businesses. A business has to implement strong ethic programs and have a solid ethics foundation. PharmaCARE’s ethics of treatment with Colberian destroyed their environment. I believe that the PharmaCARE use of Colberian property would not be in ethical accordance with utilitarianism. Utilitarianism is defined as the happiness of people. Intellectual property is when a person or people get rights to something that they have created. There is no connection between the two. In order to determine if we have made the right moral choice, we have to have knowledge of our moral duties, also what rules are put in place to assist with regulating the moral duties. In order to act morally one must act from duty. PharmaCARE would be ethical in accordance with Deontology ethics. One has to do the right thing no matter how bad the situation may seem. It is not moral when it comes to risking people health just to make sure your company profits. Nor is it ethical to do things that are against the law just to meet production. The consequences behind someone doing something do not necessarily make it right or wrong, it is the person motives. The development of humans ethical abilities called virtue through training; often exposes the ethical behavior from being around families and communities. We learn how to be generous, courageous, honest, cheerful, and cooperative through virtues. These virtues come from everyday living conditions as well as from different social settings. We also learn from ethics that the learning habits we have embraced can help us excel in everyday life. “However, PharmaCARE’s virtue ethics with the Colberians were wrong because even though the executive managers own the native land, they should have treated the people with some dignity and respect,” (Halbert & Ingulli, 2012). Ethic of care philosophy based on caring for others according to Carol Gilligan, and how people strongly linked together through nettings relationships in which ethical decisions cannot be made outside the context of those relationships. Ethics becomes the importance of fostering and strengthening the ties people have towards one another and requires them to think about the best way to nurture and strengthen the relationship. Ethic of care follows the abstract principles rules to avoid harm, but with the untidy responsibility of caring for others. To become creative in practical compromises in order to maintain the relationships that matter most. Therefore, PharmaCARE’s ethic of care towards the Colberians, because they did not care about building a nurturing relationship with them, when their senior managers lived lavishly, and the Colberians lived poorly (Halbert & Ingulli, 2012).
PharmaCARE started a massive manufacture base in Colberia, where they found “healers” who willingly shared information about their natural cures and the company started producing pharmaceutical drugs extensively, which destroyed their natural habitat and endangered species, and caused them to make some wrong decisions overall. They had the Colberians to harvest the plants in their native land, paid them $1.00 a day while most of the people living standards conditions were poor, and they live inside primitive huts with no running water or electricity. Meantime, PharmaCARE’s senior managers live in luxury with tennis courts, swimming pools, and golf course, and earn bonus checks from the company to keep their mouth close about the working and environmental conditions going on in the company. Therefore, PharmaCARE unethical decisions in accordance to all of the ethical philosophies where evil (Strayer, 2013).
In order to be protected by the U.S. Law, PharmaCARE established a subsidiary coopting company called CompCARE to begin formulating the new drug, so they could sell the drugs to individuals from prescriptions, after FDA’s researched and discovered PharmaCARE’s pharmacists were reformulating their diabetes drug called AD23 to maximize the effects. Since PharmaCARE was the parent company, CompCARE was able to patent the new drug, operate under the FDA and U.S. Patent and Trademark laws, and sell the drugs this way (Strayer, 2013).
Since PharmaCARE/CompCARE took the Colberia’s assets and used their natural cures to patent new drugs as their intellectual property, there is one thing they could do to rectify the Colberians by sharing some of the benefits through the United Nations Convention on Biological Diversity (CBD). However, since CBD has not been ratified in the United States, PharmaCARE/CompCARE could philosophically help people and the nation by screening plants more efficiently to get bio-prospecting more to protect the environment and endangered species since they promise to protect the environment (Halbert & Ingulli, 2012).
Merck & Co., Inc. is considered the third largest selling drug company and they produced the drug called Vioxx. They had to stop making the drug because of cardiovascular (heart attacks) events and sudden/unexpected death rates reports (Rotthoff, 2010). PharmaCARE/CompCARE manufactured its top-selling drug called AD23, and the company is one of the world’s most successful drug business. They had to stop making its drug for the same reason (Strayer, 2013). Both drugs targeted the elderly, marketed towards the medical companies, and created skirting technicalities to try and illegally sell the drugs to keep FDA’s rules and regulations. They tarnished their reputations, and allowed greed and unethical decisions to produce excessive amount of drugs to meet the demands knowing it would cause injury and danger to the consumers. They did not inform the consumers of the serious problems. With these unethical decisions, both companies losing financially in the pharmaceutical business. Merck lost billions through lawsuits, and PharmaCARE/CompCARE had to sell its business to WellCo (Rotthoff, 2010 & Strayer, 2013
After WellCo purchased CompCARE from PharmaCARE, weeks later AD23 publicly announced over 200 cardiac deaths and both companies stock prices dropped, which made their stock prices plummet and their shareholders lose profits. The shareholders are able to sue the companies, and be compensated monetarily, but the biggest success would be to have the court order procedures to enhance the drug’s safety. Address any urgent drug-safety risks by appointing a committee, hire a medical officer to be an independent third party to serve as an Executive official who reports to the CEO, monitor the drugs ongoing, amend the company’s code of conduct, and change corporate governance procedures to be acceptable. These are some of the things shareholders could have in a legal suit, and this could be beneficial for them and the consumers (Staton, 2010 & Strayer, 2013).
PharmaCARE is not living up to its kind because it proclaims to be “one of the world’s most successful pharmaceutical companies, enjoying a reputation as a caring, clean and well-run company that produced high-quality products to keep millions of lives and enhanced the quality of life for millions of others” (Strayer, 2013). However, their rates dropped after their stock price changed. Their reputation as a caring company does not confirm how they produce dangerous drug that made people sick and died. They were wrong to cause dangerous drugs in an inefficient and nonenvironmental site while claiming to save millions of lives to improve the quality of life for themselves instead of for others. They manufactured drugs that killed people and the executives knew, and continued to produce drugs out of greed. This unconscionable decision made millions of people sick and destroyed the quality of life for others (Strayer, 2013)
One thing PharmaCARE can do to get more ethicals is by not trying to beat the system with making unsafe, hazardous, and dangerous pharmaceutical drugs. However, in order for them to be maintained ethics they should get some ethical philosophies to carry out their mission statement, require some thoughtful changes, and support the government rules and regulations in order to maintain a successful and profitable business.

References

Halbert, T. & Ingulli, E. (2012). Law & Ethics in the Business Environment (7th ed.). Mason, OH: South-Western Cengage Learning
Hamburg, M. (2012, March 8). National Consumer Protection Week and FDA’s Fight Against Health Fraud Scam. FDA Voice. Retrieved from http://blogs.fda.gov/fdavoice/index.php/2012/03/national-consumer-protection-week-and-fdas-fight-against-health-fraud-scam/#sthash.J8ZFxhtJ.dpuf
Hamburg, M. A. (2013, April 11). Proactive Inspections Further Highlight Need for New Authorities for Pharmacy Compounding. FDA Voice. Retrieved from http://blogs.fda.gov/fdavoice/index.php/2013/04/proactive-inspections-further-highlight-need-for-new-authorities-for-pharmacy-compounding/#sthash.VZguZ8xC.dpuf
Rollins, B. L., King, K., Zinkhan, G., & Perri, M. (2011). “Nonbranded or Branded Direct-to-Consumer Prescription Drug Advertising-Which is more Effective?” Health Marketing Quartley, 28(1), 86-98.
Roth, J. (2013, July 24). FDA’s Special Agents: On the Job to Protect the Public. FDA Voice. Retrieved from http://blogs.fda.gov/fdavoice/index.php/2013/07/fdas-special-agents-on-the-job-to-protect-the-public/#sthash.1MM3fvlk.dpuf
Rotthoff, K. W. (2010). Product liability litigation: an issue of Merck and lawsuits over Vioxx. Applied Financial Economics, 20(24), 1867-1878. doi:10.1080/09603107.2010.526571. Retrieved from https://web-ebscohost-com.libdatab.strayer.edu/ehost/pdfviewer/pdfviewer?sid=3d631e55-0871-4bb7-ae24-207fa72bc878%40sessionmgr10&vid=5&hid=14
Stange, K.C. (2007). Time to Ban to Ban Direct-to-Consumer Prescription Drug Marketing. Annals of Family Medicine. pp 101-104.

Staton, T. (2010, February 10). Merck Makes Deal With Vioxx Shareholders. FiercePharma. Retrieved from http://www.fiercepharma.com/story/merck-makes-deal-vioxx-shareholders/2010-02-10
Strayer University. (2013, July 11). LEG 500 Student Version 1136 (1234 5-31-2013)

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