ETHICAL AND NON-ETHICS OF MARKETING OF DRUGS

Business ethics (also known as corporate ethics) is a form of applied ethics or professional ethics, that examines ethical principles and moral or ethical problems that can arise in a business environment. It applies to all aspects of business  and is relevant to the conduct of individuals and entire organizations.

There are many issues which are faced by the pharmaceutical industry across the world. These issues are listed below:

Issues of marketing of drugs: The companies in the pharmaceutical industry spend billions of amounts in advertising or marketing management . The physicians or doctors are given free locus assignments. gifts, and commissions to prescribe the medicines of the particularc  In many cases, the locusassignments.which are given to doctors for patients are not given to them. Instead of that, the patients are prescribed the medicines which benefit the doctors the most.  The marketing experts of the companies persuade the doctors to prescribe their drugs, no matter how effective or costly they are for the patients (Connolly, 2017).

Increase in the prices of drugs: In some of the cases, the companies in the pharmaceutical industry charge unreasonably high prices for the customers. There are some of the cases, where the prices of drugs are increased which are disproportionate with the rate of inflation or the cost of the drugs. US is facing high drug prices issue because the companies are free to decide the prices and there are restrictions on FDA to approve generic drugs (Lupkin, 2016).

Issues of Corporate scandals: Sometimes, the pharmaceutical companies get engaged in the illegal or inappropriate practices. For example, Valeant, a drug company in the USA adopted a new business model and overstated the earnings of the company by $600 million in 2015 (Gandel, 2016).

2. CRITICAL BUSINESS SITUATION & DECISION-

The companies in the pharmaceutical industry face the situations of ethical dilemma in many cases. As discussed in 1.2, there are various types of ethical issues which are to be handled by the company. For an example, a critical situation for the business may arise where the company has to cover its high costs of R&D and marketing and they charge it from the customers.  In this context, the pharmaceutical companies are required to take the decision in relation to the maintenance of quality and implementation of the policies regarding quality assurance and earning of profits.

Also, many corporate scandals are done by the pharmaceutical companies across the world. In this critical situation, the businesses have to take decisions as to what should be done which is beneficial both for the stakeholders and the business itself. For example, the big corporate scandal of Martin Shkreli, the CEO of Turing Pharmaceuticals, in the USA where they bought rights to the drug named Daraprin and hiked the prices by 5000%. This incident led awareness among the public and they started giving and presenting their views on social media. Martin Shkreli was arrested for the fraud on securities fraud charges.

The businesses have to take critical decisions like these so that the sentiments of the public can be controlled. Here, the ethical dilemma in the industry was corporate scandal taken by martin Shkreli to increase returns for the investors. The critical business situation was that the unethical practices of using the funds of one business to pay off the debts of other were revealed. The business decision was taken in which Martin was arrested and the prices for the drug dropped by the business .