It has never been the intention of the SOYMB blog to be focused on one particular sector of capitalism but simply because report after report comes out critical of the pharmaceutical industry, it may appear that the blog concentrates unduly on the drug companies.
Transparency International says corruption is making a few rich and wrecking the health of some of the world's poorest people. A quarter of medicines consumed in low and middle-income countries are falsified or sub-standard, according to a report. World governments and Big Pharma companies are "turning a blind eye” to bribery and corruption.
Transparency International’s ‘Corruption in the Pharmaceutical Sector’ report found that despite as much as $300m (£207m) of annual global health expenditure being lost to corruption and errors: “Genuine commitment to anti-corruption policies by heads of governments, senior government officials and regulatory agencies is currently absent in many countries.” In some contexts, the report added, combating malpractice was “hampered by a tacit acceptance of corruption.”
Corrupt tactics highlighted in the campaign group’s report include paying doctors to participate in surveys of medicines they have never actually prescribed, and companies secretly ghost-writing clinical trials research before passing it off as the work of impartial academics.
Bribery and corruption, the report says, also allow some companies to get round manufacturing regulations, helping to create a situation where about a quarter of medicines consumed in low and middle-income countries are falsified or sub-standard.
“Where one individual gains from creaming off the top,” said Sophie Peresson, the director of Transparency International’s pharmaceuticals and healthcare programme, “Hundreds more can be deprived of the most basic healthcare, often in the poorest populations of the world.” Claiming that the global pharmaceutical sector was “wide open to corruption”, she added: “It is shocking that despite scandal after scandal, policymakers simply are not taking seriously the corrosive effect of corruption. The red flags are being ignored. Governments and pharma companies must recognise their responsibility in fighting corruption and stop turning a blind eye.”
Part of the problem, the report said, was the huge power of the pharmaceutical industry in a world where global spend on medicines is expected to grow to $1.3tn by 2018. Big Pharma’s financial muscle, the report claimed, allowed it to spend millions every year on political lobbying: “Pharmaceutical companies can unduly influence national political systems through their large spending power. They often fund candidates that support their position on key issues.”
Although some industry associations, such as the Pharmaceutical Research and Manufacturers of America (PhRMA) have previously insisted they are “educating” not advocating, the Transparency International report insisted: “Such funding can shape policy debates to favour a pharmaceutical company’s profit maximisation and negatively impact public health objectives.” Pharmaceutical companies, it was claimed, could also buy a positive but misleading gloss on trials of a drug’s safety and effectiveness. The report said one study found that 94 per cent of industry-funded clinical trials of antidepressants was written up to suggest positive results, but when the US Food and Drug Administration re-examined the same studies, it found only 51 per cent had genuinely positive outcomes.
The corruption could even extend to disguising who had actually written the research. The report claimed that having the pharmaceutical industry ghostwrite clinical trial articles and pass them off as the work of eminent researchers was “a common practice, particularly in industry-led trials. Ghostwriting can increase the prestige of the findings, while researchers improve their reputation, which can lead to promotions.
“Many academic journals,” the report claimed, “cannot or do not want to monitor the practice adequately. There is a need for systemic change.”
The report also claimed vast sums were spent on influencing doctors and this sometimes involved persuading them to prescribe expensive drugs that were no better than cheaper alternatives. In the US alone, the report said, “The pharmaceutical industry spends an estimated $42bn a year on promotional activities that target doctors, which is equal to $61,000 per doctor on average.” In some countries, the report said: “A pharmaceutical company can use representatives to collect data on the safety and efficacy of its medicines from doctors who did not even prescribe the medicines being studied, in return for some kind of compensation.”
In countries lacking good governance, bribery and corruption could also be used to get around medicine manufacturing standards. As well as the immediate dangers of about 25 per cent of medicines being substandard or fake in poorer countries, there were knock-on effects in the form of a global increase in the prevalence of drug-resistant bacteria.
Doctors unwittingly prescribing poorly-made medicines could assume they were giving drugs which were correctly manufactured but not working on their patient. They could then switch to an antibiotic as a last resort, giving bacteria more exposure to a drug supposed to be used only rarely, and thus increasing the chances of resistant strains evolving. Pharmaceutical companies cause doctors to receive biased information about drugs ‘costing hundreds of thousands of lives’.
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But, the report admitted, the rewards of corruption were so great it was difficult to deter. “Fines often have little financial impact compared to the profits corrupt pharmaceutical companies make from the sales generated by such practices.
“For example, since 1991, the industry has paid $30bn in criminal fines in the US for Medicare fraud, unlawful promotion, kickbacks, monopolistic practices and failure to disclose clinical trial data, yet this is less than half of what the industry made in 2009 alone. To genuinely diminish corruption in the pharmaceutical sector,” the report concluded, “national governments must show commitment to tackling the issues. Regardless of a company’s revenue, an official’s seniority or a healthcare professional’s prestige, anyone suspected of corruption must be investigated and sanctions applied.”