Merck : An Ethical And Socially Responsible Drug Manufacturer

It took Merck five years to remove Vioxx from the market. Why? They were in denial, because it has been mentioned that they thought they “acted responsibly and appropriately as they developed and marketed Vioxx”. And they had the approval of the FDA. Also, if they pulled the medication off the markets, they would lose money it took to develop the medication. Looks like they chose to

There are multiple health concerns worldwide and more and more drugs are needed every day. Many drugs however, are extremely expensive to develop, test, and produce. According to the Tufts Center for the Study of Drug Development (2002), it costs up to $802 million to bring a new drug to the market. In 2002, pharmaceutical companies spent $34 billion in research and development (Center-Watch, 2003). In addition to the costs, the overall time from the discovery to approve and market the drug can take up to 15 years.

In 2015, the pharmaceutical industry spent over 27 billion dollars on advertising. The two greatest components of this effort were promotional advertising and free medication sampling, which the pharmaceuticals invested 15.5 and 5.7 billion dollars respectively (“Persuading the Prescribers”). Promotional advertising involves direct contact with health professionals, the most common being extravagant lunch conferences held for physicians and their staff. On the other hand, sampling involves distributing free sample of medications to physicians, who then have a choice of providing these samples to patients. As a result of these methods, the industry has seen revenue around $400 billion with 90% of physicians having a relationship with a drug company (Campbell 2007). Moreover, the prices of prescriptions continue to rise; a copay of a generic drug is $11.72, preferred brand drug is $36.37 and a specialty drug is $58.37 (Coleman and Geneson 2014). Although the profits are immense in the numbers demonstrated above, it is no surprise when pharmaceutical drug companies elevate their prices even more. For instance, recently Turing Pharmaceuticals raised the price of their medication Daraprim from $13.50 to $750. Keep in mind, this medication is used for threatening parasitic infections, aids, and cancer with alternative options currently found to be inefficient (Pollack 2015). Another example of this practice involves cycloserine, a drug used to

Improvements in health care and life sciences are an important source of gains in health and longevity globally. The development of innovative pharmaceutical products plays a critical role in ensuring these continued gains. To encourage the continued development of new drugs, economic incentives are essential. These incentives are principally provided through direct and indirect government funding, intellectual property laws, and other policies that favor innovation. Without such incentives, private corporations, which bring to market the vast majority of new drugs, would be less able to assume the risks and costs necessary to continue their research and development (R&D). In the United States, government action has focused on creating the environment that would best encourage further innovation and yield a constant flow of new and innovative medicines to the market. The goal has been to ensure that consumers would benefit both from technological breakthroughs and the competition that further innovation generates. The United States also relies on a strong generic pharmaceutical industry to create added competitive pressure to lower drug prices. Recent action by the Administration and Congress has accelerated the flow of generic medicines to the market for precisely that reason. By contrast, in the Organization for Economic Cooperation and

The high prices set by pharmaceutical companies for drugs allows the companies to continue researching, developing, and producing new drugs. As new diseases are discovered, new medications must be discovered in order to treat them.

When asked most people will say they are on at least one medication whether it be something over the counter or prescription. John Tirman in his book “100 Ways America Is Screwing up the World” writes about Big Pharma and how it has become both a domestic and global problem. Tirman discusses how American drug companies have a greater profit margin then most fortune 500 companies writing, “in 2004, the top nine American drug companies- this listed on Fortune 500- made median profit margin of 16 percent of revenues compared with 5.23 percent for other Fortune 500 industries” (Tirman 90). He goes on to talk more about how Big Pharma is dominating the industry, telling the reader that they are spending more on advertising than research. Tirman

The rise in costs of prescription medicines affects all sectors of the health care industry, including private insurers, public programs, and patients. Spending on prescription drugs continues to be an important health care concern, particularly in light of rising pharmaceutical costs, the aging population, and increased use of costly specialty drugs. In recent history, increases in prescription drug costs have outpaced other categories of health care spending, rising rapidly throughout the latter half of the 1990s and early 2000s. (Kaiseredu.org, 2012).

1. Blake, Hannah. “A history of Merck & Co”. Pharmaphorum. May 30, 2013. Retrieved from http://www.pharmaphorum.com/articles/a-history-of-merck-co

Merck is a drug manufacture giant who brings an annual revenue of nearly fifty billion. Prior the Vioxx recall Merck was a highly valued company when it came to its ethical standard. It had consistently toped list for companies to work for (Lawrence & Weber, 2014). In addition to this they were well recognized as a socially responsible company who placed an importance on testing to provide the best quality pharmaceuticals. The Vioxx recall caused a huge blow for the company resulting in lawsuits and drop in company value.

We are committed to the highest standards of ethics and integrity. We are responsible to our customers, to Merck employees and their families, to the environments we inhabit, and to the societies we serve worldwide. In discharging our responsibilities, we do not take professional or ethical shortcuts.

Moreover, a September 2003 report stated that low-skilled paramedics and the development of resistance are not major problems since “cocktails” are combined into blister packs. Other critics argues that pharmaceutical companies are making more money than we think, they claimed in 2002, the ten biggest drug companies had profit of $35.9 billion, which is half of Fortune 500 list of companies’ netted

The primary ethical dilemma in this case revolves around corporate social responsibility and ethical practices versus profitability and maximizing shareholder wealth. In this case, Merck had to decide between profits at the center of the company’s shareholders wealth, the company’s image from a corporate social responsibility perspective, and the welfare of the community. The company had a responsibility to safely serve the public and meet the interest of all parties involved without compromising the interests of key stakeholders. Merck's practices regarding the Vioxx debacle were clearly designed towards generating profits, with no consideration given towards protecting the consumer. Consequently, they stand in clear violation of the principles

Research and Development: Merck is a research-driven company that has a new research and development model incorporating its business strategy. Merck hopes to improve the success of is R&D and to reduce costs by focusing on therapeutic areas that have unmet medical needs, and scientific and commercial opportunity. It plans to develop products within these therapeutic areas that are highly valued by patients and doctors.

Merck was established in 1891 to improve human and animal health through the development of innovative products. Merck currently has two reportable segments, the Pharmaceutical Segment and the Vaccines and Infectious Diseases Segment. Merck sells products through several channels including wholesalers, retailers, hospitals, clinics, government and managed health services providers. In the 1980’s the Merck was very successful in producing 10 major new drugs and had a very healthy pipeline. In later years, Merck has entered into joint ventures with many other pharmaceutical companies in order to expand its pipeline. In the last several years Merck has

In the late 1970s, Merck was falling off a 10-year dry season as far as new items. For about 10 years, the organization had depended on two physician endorsed drugs for a critical rate of its around $2 billion in yearly deals: Indocin, a treatment for rheumatoid joint inflammation, and Aldomet, a treatment for hypertension. Henry W. Gadsden, Merck's CEO from 1965 to 1976, alongside his successor, John J. Horan, were worried that the 17-year patent security on Merck's two major moneymakers would soon terminate, and started putting a tremendous sum in research.