Purdue Pharma's Corporate Scandal: Essay On Dynamics And Ethical Considerations.

Prepare a analysis of the dynamics of a recent news case with ethical considerations.

 The paper should:

• Describe the complex issue(s) involved in the news.  
• Demonstrate an understanding of counterbalancing factors, legalities and responsibilities.
• Identify wider implications and connect with other businesses, places, industries, products, etc. with which this topic has relevance.

Business Issue

In this report the case of Purdue Pharma is taken which was recently in news highlight due to corporate scandal and issues in business ethics that has recently surrounded increased attention of public and regulators due to corporate misconduct and failure to envisage social responsibility.

Recently Purdue Pharma LP hit the news in New York for widespread fraud and cheating in marketing of opioids that resulted into national epidemic killing several people. The pharma company was alleged of misleading practitioners and patients and they intentionally pulled away transparency to risk lives of several innocent people by making them addicted to opioids to earn more profits at cost of lives (Stempel 2018).  A legal case was filed against Purdue Pharma in New York Supreme Court for alleged unethical conduct that resulted to harm of society. Corrupted and dishonest distributors had a prime role in production of opioid epidemic that drove pharma industry profits by 400 billion USD through human suffering. A legal suit was filed on Purdue Pharma on charges of discrepancy in transparency to public to raise their profitability which they initially refused stating their concern on opioid crisis (Fred Schulte, K. Health News 2018).  Purdue Pharma also asserted that entire scientific and medical report that it gave to doctors were being sanctioned under US Food and Drug Administration and as per information produced by Symphony Health Solutions the company in year 2017 made a sale of Oxytocin that amounted to 1.74 billion USD. Also other Opioid manufacturers and distributors across US were incriminated of indulging into ambiguous marketing for sale of painkillers that made them face various legal cases. For issuing lawsuit against Purdue Pharma over opioid New York collaborated with another 26 US states and Puerto Rico. Also for contending opioid crisis New York has filed its own legal suit to seek 500 million USD from Purdue Pharma and 7 other opioid manufacturers and distributors (Crow 2018 a).   

The prime legal dynamics that has been potentially associated with case of Purdue Pharma is violation of ethical code of conduct surrounding corporate social responsibility and involvement in non-transparent issues of marketing practices. According to Crow (2018) as per reports claimed by US Centre for Disease control and Prevention in year 2016 a primary role was played by Opioid including prescribed painkillers and heroine that led to recorded death of 42,249 individuals of which about 3.086 death cases were reported from New York State and another 1,110 from New York City. Also earlier in year 2007, in an investigation made against Purdue Pharma under US Department of Justice the company and 3 of their executives accepted to pay legal penalty of 634.5 m USD as they were found guilty with issue of misbranding and non-transparency for Oxytocin.  

The issue involved in case of Purdue Pharma can be identified as issue of sustainability in context to corporate social responsibility where the pharma company compromised their business model and practices that led to social damage and harm to lives of several people in an attempt of the company to gain short term profits from business. As stated by Leiva, Ferrero & Calderón (2016) corporate social responsibility is generally a business concept that revolves around practices of corporate to offer social well being through making efforts that can efficaciously develop positive public image and appeal stakeholders attention for efforts of CSR. These concepts legitimise corporate in being considerate about the implication of their practices over dimensions of society in context to economic, social and environmental sustainability. Generally enterprises involve in corporate social responsibility activities to work actively towards development of community and environment improvement rather than creating negative augmentations. Also issues for ethics, law and regulation are dimension that falls under concerns of corporate responsibility and obligations that has negative impact on economy, people and environment. According to Pollman (2016) profit generation is prime objective of every corporate but it is significant that they follow path of rules, regulations and legal obligation like code of conduct, ethical rights, civil rights and acceptable social standards that are governed by federal, local states and legislations while incurring profitability for business.  Since long there had been several news cases of corporate social responsibility and ethical failures that led to huge damages in terms of cost to people or community. In past two decades many pharma companies had faced cases of unacceptable or poor CSR activities and most of these had surrounded over unethical marketing and sales activities or illegitimate clinical tests.  Practices like marketing usage of drugs for off label purpose, giving evasive information to practitioners and public on drug and health issues and manipulating testimonial about effectiveness of drugs and clinical tests had large become a part of pharmacy business today which has troubled the industry.   

Counterbalance factors involved

According to Croff, Hoffman, Alanis-Hirsch, Ford, McCarty & Schmidt (2018) the legalities demonstrated by Office of New York Attorney General by seeking around 500 mn USD from Purdue Pharma for fighting the opioid crisis is a clear example of counterbalancing considerations where government demonstrated clear responsibility to act legally against Purdue Pharma through adequate consideration of ethical decisions. The decisions taken by government and law though were complex would deter opioid producers and distributors in future from distributing these drugs as from numerous evidences it has been conceded that in some nations these drugs were actually more than their total population which were infact indication of wrong practices.  Moreover counterbalance decision taken by court would considerably control the opioid abuse across USand would further curb excessive prescription of opioid drugs due to formation of government regulatory bodies that would be vigilant on supply chain activities of pharma companies which would insure these drugs do not fall into wrong hands nor are these manufactured by proliferation of legislations and responsibility towards health of public.    

As business ethics generally indicates role of corporate as well as individual towards ethical decision making that is influenced by moral guidelines so examining nature of moral conduct and activities of business for benefiting society under philosophy of morality has implication on situation of doing right or wrong activities. According to Khalid, Eldakak & Loke (2017) Deontology concepts of ethics are associated to application of moral philosophy with focus on rights of individuals and intentions surrounding the behaviour rather than upturning. As such under examination of deontology philosophy the case of Purdue Pharma will certainly raise alarm not just for this case but for other situations and application that may be possible in future by making the distributors feel alerted and responsible to inform regulators timely in case excessive supply of opioid drugs within market is noticed in future as well as this case would warn doctors and general public on negative impact of health causes that can lead to danger due to overuse of these drugs which causes risk of addiction, health complication with prolonged usage.

Conclusion

Thus it can be inferred from case of Purdue Pharma that business decisions should be based on concept of right or wrong actions depending upon moral obligation and responsibility towards people, economy and environment and should not be based on gaining more profits by compromising basic ethical practices as these can damage brand image and trust of consumers in long term. So business should be wise enough to consider actions that ensure well being and should refrain from misconduct or scandals as they are social agents and bear a large responsibility to ensure sustainable development and deliver honest practices.  

References 

Croff, R., Hoffman, K., Alanis-Hirsch, K., Ford, J., McCarty, D., & Schmidt, L. (2018). Overcoming barriers to adopting and implementing pharmacotherapy: The medication research partnership. The Journal of Behavioural Health Services & Research, 1-10. Retrieved from doi: https://dx.doi.org/10.1007/s11414-018-9616-9 [Accessed on 13 Nov. 2018]

Crow, D. (2018). How Purdue’s ‘one-two’ punch fuelled the market for opioids.FT.Com, Retrieved from https://search.proquest.com/docview/2101672280?accountid=30552 [Accessed on 13 Nov. 2018]

Crow, D. (2018 a). An opioid marketing machine. Financial Times Retrieved from https://search.proquest.com/docview/2118128241?accountid=30552 [Accessed on 13 Nov. 2018]

Fred Schulte, K.,Health News. (2018). How America got hooked on a deadly drug. FierceHealthcare (Online), Retrieved from https://search.proquest.com/docview/2056536782?accountid=30552 [Accessed on 13 Nov. 2018]

Khalid, K., Eldakak, S. E., & Loke, S. (2017). A STRUCTURAL APPROACH TO ETHICAL REASONING: THE INTEGRATION OF MORAL PHILOSOPHY. Academy of Strategic Management Journal, 16(1), 81-113. Retrieved  on 13 Nov. 2018]

Leiva, R., Ferrero, I., & Calderón, R. (2016). Corporate reputation in the business ethics field: Its relation with corporate identity, corporate image, and corporate social responsibility. Corporate Reputation Review, 19(4), 299-315. Retrieved from doi: https://dx.doi.org/10.1057/s41299-016-0008-x [Accessed on 13 Nov. 2018]

Pollman, E. (2016). Constitutionalizing corporate law. Vanderbilt Law Review, 69(3), 639- 693. Retrieved from https://search.proquest.com/docview/1787751338?accountid=30552 [Accessed on 13 Nov. 2018]

Stempel, J., (2018). New York sues OxyContin maker Purdue Pharma over opioids, CNBC News Retrieved from https://www.cnbc.com/2018/08/14/reuters-america-update-1- new-york-sues-oxycontin-maker-purdue-pharma-over-opioids.html [Accessed on 13 Nov. 2018]