Prevateur Ethical Stance of the Pharma Industry

Prevateur Ethical Stance of the Pharma Industry

Pharmaceutical industry has been challenged with more than its fair share of ethical dilemmas. Even though generally considered an industry vital to the health and lives of people, this industry has also faced challenges like no other industry because of the very fact that it deals with lives and health of the public. The pharmaceutical industry believes in developing drugs for the general and specific benefit of the population and they would do every in their power to accomplish this task with absolutely care. However there are things where they may not compromise which can lead to ethical problems. One such area is drug prices. We all know that prescription drugs though considered ethical drugs are very high in prices and the more specific the target, the higher the price. Those who do not have insurance can find themselves in a very bad situation if they have to purchase these drugs on regular basis. Even though pharmaceutical industry can lower the prices, they do not wish to do this on the pretext of the investment and the high cost of research and development of the product.

Pharmaceutical industry therefore believes that as long as it meets the standards prescribed by FDA and other regulatory agencies they are being highly ethical in the production of drugs and hence they do not need to compromise on the price. It must be noted that many prescription drugs have their generic version available as well and this happened because of the high cost of drugs but there are still many who are under current patents and hence no generic version is available. While pharmaceutical companies make millions through these drugs, they hardly ever realize the struggle that an insured person goes through in purchasing these drugs. Even those with insurance are often left high and dry when some drugs are not covered by their insurance.

Pharmaceutical industry on the other hand doesn't consider this an ethical dilemma that needs to be addressed. Instead for this industry and its major players, ethics is all about the way their products are developed and their final results. Companies like Merck would invest heavily in research and development to come up with breakthrough drugs. The cost of producing these drugs is often overestimated and overinflated in order to justify their final price. But from the view point of the industry, it is more important to develop products that truly work and that have years of research behind them instead of worrying about the price that consumer will have to pay for them. That is the reason they call prescription drugs "ethical drugs."

Scenario planning:

Decision identification:

The pharmaceutical industry is faced with various challenges for the future which can affect the progress of the sector. The one important decision it needs to make is regarding high cost of research and development and the containment of the same. It also needs to think about uniqueness of drugs in order to justify the price. Other issues are connected with use of IT and other technologies in development and research etc.

Information gathering:

In this stage, the industry needs to collect information regarding these critical decisions and see how it should proceed in order to keep the industry at maximum level of performance and profits.

Identification of driving factors:

The industry needs to identify the factors that would affect its decisions and the whole face of the industry in the future. These factors for the pharmaceutical industry include the following:

1. Higher pressure from government and other regulatory agencies to keep the prices low

2. Presence of generic substitutes

3. Development of pharmaceutical industry in developing countries

4. More buyer power

5. Consumer having greater knowledge and information

Golden future

In this scenario, everything would be rosy for the pharmaceutical industry. It will continue to rake in profits, competition from developing countries will not be threatening enough to cause any major ripples and cost efficiency will be achieved by major players to allow some reduction in high prices of drugs. It basically means that pharmaceutical industry will have a bright future and everything will work in its favor.

Workable situation in this case, we notice that pharmaceutical industry would face tough competition from generic substitutes, rapid mergers and acquisitions and progress of pharmaceutical industry in developing countries. These will all affect the future of pharmaceutical industry by making some drugs cheaper, bringing down the cost of research and development and integration of IT and other factors to make production cost efficient in order to meet the competition coming from generic substitutes.