The Law and Ethics of the Pharmaceutical Industry


  • M.N.G. Dukes, Oslo, Norway

As one of the most massive and successful business sectors, the pharmaceutical industry is a potent force for good in the community, yet its behaviour is frequently questioned: could it serve society at large better than it has done in the recent past? Its own internal ethics, both in business and science, may need a careful reappraisal, as may the extent to which the law - administrative, civil and criminal - succeeds in guiding (and where neccessary contraining) it. The rules of behavior that may be considered to apply to today's pharmaceutical industry have emerged over a very long period and the process goes on. Even the immensely detailed standards for quality, safety and efficacy laid down in drug law and regulation during the second half of the twentieth century have their limitations as tools for ensuring that the public interest is well served. In particular, national and regional regulatory agencies are heavily dependent on industrial data for their decision-making, their standards and competence vary, and even the existing network of agencies does not cover the entire world. What is more there are many areas of law and regulation affecting the industry, concerning for example the pricing of medicines, the conduct of clinical studies, the health protection of workers and concern for the environment. In some fields it is indeed hardly possible to maintain standards through regulation.Professor N.M. Graham Dukes, a physician and lawyer with long term experience in industrial research management, academic study and international drug policy, provides here a powerfully documented analysis into the way this industry thinks, acts, and is viewed, and examines the current trends pointing to change.
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Pharmaceutical Industry, Government policy makers, Academic Health policy researchers


Book information

  • Published: November 2005
  • Imprint: ELSEVIER
  • ISBN: 978-0-444-51868-2


"...Although Dukes doesn't attempt to catalogue all relevant laws, he provides categories and examples that serve as a useful starting point for understanding the types of policies and laws that should be considered in particular cases. In addition, Dukes includes stories that led to the adoption of some of the laws and policies, which helps to make the process more accessible to the reader." - Jeremy Sugarman, M.D., M.P.H., Johns Hopkins University for THE NEW ENGLAND JOURNAL OF MEDICINE(2006) "...a measured walk through most of the beter-known public policy issues revolving around drug research, marketing and use." - (2006)

Table of Contents

PREFACEACKNOWLEDGEMENTSPART A: THE DEFINITION OF STANDARDS 1. INTRODUCTION: THE PHARMACEUTICAL INDUSTRY AND ITS PRODUCTS 1.1. The concept of a pharmaceutical product 1.2. The development of the pharmaceutical industry 1.3. The unique nature of the pharmaceuticals field and the need for rules 1.4. The various roles of the pharmaceutical industry today 1.5. Types of firms engaged in the pharmaceutical field 1.5.1. Research-based companies x1.5.2. Generic manufacturers 1.6. The reputation of the pharmaceutical industry 2. SOURCES OF STANDARDS FOR BUSINESS AND INDUSTRY 2.1. Grounds for defining and respecting business standards2.1.1 General 2.1.2. A basis in h uman rights 2.1.3. The notion of business ethics (i) Ethics in daily practice?(ii) Individual and company standards(iii) The purpose of business(iv) The Friedman dogma(v) Loyalty to the Company (vi) Distance from society(vii) The attitude of management2.2. Some laws and regulations relating to business generally 2.2.1. Laws of contract and Sale of Goods2.2.2. The law of tort and non-contractual liability2.2.3. Consumer Protection Legislation2.2.4. Intellectual property: trade marks, patents and data exclusivity(i) Property and Human Rights(ii) Trade Marks and Counterfeiting(iii) Patent Law(iv) The TRIPS Agreement(v) The "evergreening" of patents(vi) Claims of data exclusivity (vii) The ethics of data protection2.2.5 Social and employment law2.2.6 Environmental law 2.3. Competitive and financial pressures 2.4. Political influences2.5. The influence of litigation2.6. Public opinion and the public image2.7. The location of the company conscience2.8. Company and industry codes of behaviour2.8.1. Types of Codes2.8.2. Style and content of codes 2.8.3. The usefulness of Codes 2.9. Transnational corporations and influences2.10. "Corporate social responsibility" and Governments 3. SOURCES OF STANDARDS SPECIFIC TO THE PHARMACEUTICAL INDUSTRY3.1. General considerations 3.2. Standards based on human rights in health 3.3. Standards originating from pharmacy practice 3.3.1. A basis in trust3.3.2. Standards of knowledge 3.3.3. Fields of knowledge3.3.4. Trade interests versus professional interests3.3.5. Codification of standards in pharmacy3.3.6. Pharmacy standards in the Pharmaceutical Industry 3.4. Standards originating from medical law and ethics3.4.1. Primary duty to the patient 3.4.2. Current medical expertise 3.4.3. The duty of care 3.4.4. Confidentiality 3.5. Standards set by pharmaceutical legislation and regulation3.5.1. The evolution of modern drug regulation 3.5.2. The scope of legislation and regulation 3.5.3. Issues of responsibility and liability 3.5.4. Relationship of the applicant to the regulatory agency 3.5.5. The global coverage of law and regulation 3.5.6. Old versus new products 3.5.7. Criticism of regulatory developments3 5.8. The emergence of deregulation 3.5.9. The adequacy of regulation today3.5.10. The role of WHO 3.6. Self-regulation in the pharmaceutical industry PART B: ACCEPTANCE AND IMPLEMENTATION OF STANDARDS 4. THE INDUSTRY AS A DEVELOPER, MANUFACTURER AND SUPPLIER4.1. Pre-marketing and Post-marketing Duties4.2. Exactness of standards4.3. The Quality of Drugs4.4. The Safety of Drugs4.5. The Efficacy of drugs5. THE INDUSTRY AS A SOURCE OF INFORMATION, PERSUASION AND EDUCATION 5.1. Basic information5.2. Persuasion5.2.1. Advertising to the health professions 5.2.2. Advertising of prescription medicines to the public 5.2.3. Non-explicit advertising 5.2.4. Disease mongering 5.2.5. Financial incentives 5.3. Education 5.4. Future Developments 6. PHARMACEUTICAL PRICING AND PROFITS6.1. Pharmaceutical Prices and Controversies6.2. The Level of Spending 6.3. The Manufacturer's costs 6.4. The ethics of pricing and profits6.5. How does society control the prices of medicines?6.5.1. Calculation of the "fair" price of a medicine 6.5.2. Reference pricing 6.5.3. Economic evaluation of prices 6.5.4. Control of profits and expenses6.6. Differential and equity pricing 6.7. Parallel Importation and Re-importation6.8. Future approaches to pricing 7. THE INDUSTRY AS INNOVATOR7.1. Innovation and duty7.2. The Innovation Controversy7.3. Statistics and Analyses7.3.1. The real cost of a new drug7.3.2. Research expenditure within the company7.3.3. Innovation trends over time7.3.4. The spectrum of drugs reaching the market7.3.5. The non-industrial role in drug innovation7.4. Future trends and corrective measures7.4.1. Should the innovation process change?7.4.2. Can industry adapt? 7.4.3. Is outside action necessary?7.4.4. The DfND Initiative7.4.5. Governments, Communities and Donors 7.4.6. Independent non-profit research centres 7.4.7. Official incentives to true innovation7.4.8. A total approach to innovation 8. THE INDUSTRY AND THE DEVELOPING WORLD8.1. Pharmaceuticals in developing countries 8.2. Atttitudes of the industry to developing markets 8.3. Duties relating to exports8.4. Access within the developing world 8.5. Other Duties within the developing world8.6. Relationship to international organizations and donors8.7. The industry in public-private partnerships9. SPECIAL SITUATIONS9.1. Ethics of Animal Studies9.2. Ethics of Human Studies Studies9.3. Self Medication9.4. Vaccine Manufacturing and Supply 9.5. Blood and Blood Products9.6. Controlled Substances9.6.1. The Nature of risk and injury9.6.2. Statutory and civil duties9.7. Alternative and Complementary Medicines9.8. Traditional Medicines9.9. Borderline Products9.9.1. Foods and medicines9.9.2. Cosmetics as medical products9.9.3. Contraceptives as health products9.9.4. Medical devices with pharmacological activity9.9.5. "Recreational substances"9.10. Veterinary Products 10. THE DUTIES OF THE GENERIC MANUFACTURER10.1. The nature of the generic industry10.2. The significance of the generic industry10.3. Governments, laws and generics10.4. Generic drugs in U.S. Law10.5. Generic drugs in the European Union10.6. Generic drugs in India 10.7. Generic substutution 10.8. Generic biologicals, biogenerics and biosimilars10.9. The future status of the generic pharmaceutical industry11. THE PHARMACEUTICAL INDUSTRY AND SOCIAL CONTROVERSY12. POSTSCRIPT: THE WAY AHEADSELECTED REFERENCESCONTENTS