The healthcare industry is often seen as being in the pocket of pharmaceutical giants. But some say this closeness is beneficial, and excessive transparency could be damaging

To put it politely, gifts, corruption and secrecy are historically a strong component of the global pharmaceutical industry. A look at the 20 largest legal settlements in the pharmaceutical field in the years from 1991 to 2013 demonstrates widespread misconduct in the field.

Even the companies considered most stalwart in their ethical practices have had breaches: Novo Nordisk, for example, which tops most sustainability and ethical practices lists, paid $18m in fines in 2008 for alleged illegal kickbacks to the Iraqi government through the oil-for-food programme. These types of fines, enormous and ongoing fines that have been the result of legal action, haven’t deterred bad actors.

Novo Nordisk paid fines for alleged oil-for-food kickbacks

In October 2014, French drug maker Sanofi disclosed that it was investigating improper payments to healthcare professionals in East Africa and the Middle East. That’s the latest in a very long string of bribery accusations dogging Big Pharma.

Sanofi received kudos for notifying US regulators and hiring independent legal counsel to investigate the possible abuses. And, on the bright side, Sanofi’s actions may be part of a new era of transparency coming to the industry, prompted by the pressure of global legislation, discontent among stakeholders and ongoing internal work by a select band of big pharmaceutical companies themselves.

Improvements to transparency and accountability, and curbing the appearance and the occurrence of corruption and bribery are happening in at least two main areas: in the reporting and limiting of payments between pharmaceutical companies and doctors, and in the release of more of the clinical trial data that influences how drugs are recommended and prescribed for use.

In the US, implementation in September of the Physician Sunshine Act (passed with Obamacare, aka the Affordable Care Act) was a big step. “Sunshine” as it is known, entails the set up and launch of a new website called Open Payments that has details of required reporting from physicians and teaching hospitals on money and gifts received from pharmaceutical and medical device companies. The new online database, which at this point contains only five months’ worth of data, has already amassed more than 4m payments to half a million US doctors and hospitals, totaling $3.5bn (this includes research project donations).

Obamacare requires pharma-to-physician transparency

In the area of clinical trial data, the European Medicines Association (EMA) endorsed, in October, a scheme that will make clinical trial reports around new drug approvals more widely available, from the beginning of 2015. In the meantime, a consortium of 10 companies is supporting making archived clinical trial data available to researchers by request through a new site called

How low could it go?

Two questions must be considered when looking at these advances in transparency and curbing corruption: are the improvements enough to truly change pharmaceutical companies’ ethical conduct at its foundations, and can they significantly advance credibility in the court of public opinion?

The reputation of Big Pharma is currently not good. The Danish doctor-researcher Peter Gøtzsche maintains Big Pharma is one of the most corrupt industries in contemporary society. The public may be starting to agree: in a US-based 2013 Harris poll North Americans rated the pharmaceutical industry’s ethical behaviour below that of the finance industry (whose scores have dropped since the 2008 recession) and just above Big Oil and the tobacco industry, with only 10% of respondents saying pharmaceutical companies are “generally honest and trustworthy”.

Ethicist and governance fellow Jennifer Miller of Harvard University and Duke University, when asked if the public really needs to trust Big Pharma more, answers “Yes”. She says: “It matters when public trust dips too low. Payers can become hesitant to reimburse for drugs and consumers can become reluctant to take them. On the business side it becomes harder for the industry to attract top talent.”

And, Miller adds, when your industry isn’t trusted by the public, more regulations follow. This can be seen to be happening today, says Paul Meade, president of the consulting services company Thought Leader Select, for example with the US Sunshine Act on pharma payments and perks to physicians.

“Forty years ago it was a free-for-all market, like the Wild West,” Meade says. “Two things began to happen, however. Physicians realized credibility among their peers could be damaged [by payments from pharma], and industry itself realized around a decade ago that they needed to clamp down and regulate themselves.”

Self-regulation wasn’t thorough or fast enough, however, and the issue is exacerbated by pharma’s deep move in the past five to 10 years into new, especially Asian, markets.

Barbara Brooks Kimmel, executive director of thinktank Trust Across America – Trust Around the World, says certain pharma companies, such as Bristol Myers Squibb, have trust “built into their DNA”. It is a minority of companies in all industries, though, that are trusted, Brooks Kimmel says. Trust, she maintains, must be considered a business imperative and built into the corporate credo, starting with trustworthy leadership, and practised every day by everyone.

Suzanne Stormer, vice-principal for sustainability at Denmark’s Novo Nordisk, says her company’s culture has always signalled “a deep understanding of the right thing to do”. One result of the oil-for-food settlement was Novo Nordisk’s renewed vigour in systematically tackling problems before they happen. At Novo Nordisk employees must be trained in business ethics and the company has very specific auditing, hotline, and follow-up mechanisms in place to monitor what could be problematic interactions. Now, Novo Nordisk has further strengthened the company’s focus by documenting and reporting this systematic approach.

“What is very clear in the tone from the top – and the CEO frequently repeats it – is that Novo Nordisk is OK to walk away from any business dealings in which we cannot guarantee integrity,” Stormer says. “What we also realised as we were going much more global, however, is that we can’t rely on culture alone.”

Documenting ethics practices does create increased paperwork, Stormer says, yet it is worthwhile. “I think it’s fair to say that if you have systematic processes around the ethical practices and can document them, that might entail competitive advantage for the company.”

Sunny, with a little haze

The Sunshine Act is not the first attempt to rein in pharma-to-physician payments, yet it is part of what Melissa LaFrain, a corporate compliance manager at Wright Medical Technology, calls the “global transparency movement” in pharma. To meet Sunshine’s requirements, 85% of US pharmaceutical companies have put a tracking and reporting system in place, according to a PricewaterhouseCoopers (PwC) benchmarking survey. Just 15% of those companies have a way to track and report this information on a global level, PwC notes, though that should increase as the trend is for more countries to put in place pharma-to-physician transparency rules: Europe’s EFPIA code, affecting 33 countries, comes into effect in 2015, and Japan, Australia, and France already have some rules in force.

Paul Meade said he hopes that the transparency efforts won’t go too far in limiting what he sees as necessary interactions between physicians and pharma. “In managing diseases you really want that back-and-forth, that great symbiosis, between leading physicians and drug companies – which drugs work best, which kinds of studies need to be done – these are the things that occur when the two sides get together.”

Meade worries, especially as a result of Sunshine, that the media and the public aren’t getting the context that needs to go with the data – a patient looking at the Open Payments site might think $50,000 going to a single physician is untoward, but a quick check reveals that the doctor is at the leading edge of current treatment in her/his field speaking at a number of annual conferences, and the sum seems much more reasonable.

UK-based GlaxoSmithKline (GSK) is taking an extra step beyond Sunshine and planning to cease payments to healthcare providers (HCPs) “to speak on our behalf” by 2016.

“There’s a growing concern about the way information from companies is provided to HCPs and how they are paid to speak on behalf of the industry,” says Clare Griffin, head of GSK’s corporate responsibility and corporate reporting. “We decided to stop direct payments, and instead we will build the capacity of our own medical expert doctors and create new digital channels through which [experts] can share information with HCPs. No one else is taking this approach.”

Meade thinks GSK’s approach may be “pushing the pendulum to the opposite extreme” in controlling interactions between doctors and pharma companies. While he says that the new levels of transparency and “full disclosure” of any payments are absolutely the foundation of medical ethics, he says more, not fewer, interactions between companies and HCPs will improve outcomes and patient care.

All trials and all the data

A drug called Tamiflu from Swiss pharmaceutical company Roche is, according to some, the poster child for the negative effects of Big Pharma’s refusal to share all clinical trial data. Widely touted as the drug to help fight influenza complications during the swine flu outbreak in 2009, Tamiflu racked up billions in sales and was stockpiled by governments. In the UK alone, £500m was spent on the drug.

Tamiflu was stockpiled by governments

Yet in 2014, non-profit organisation the Cochrane Collection went through a painstaking process to summarise trial data on the drug, and concluded that Tamiflu did not do much against flu complications such as hospitalisations or pneumonia, and could have nasty physical and psychological side effects for some recipients.

Cochrane had difficulty getting trials data from Roche, and Roche had no legal obligation to supply it. And therein lies the rub: the people who routinely pay for and prescribe medicines such as Tamiflu rarely get to see all the data from all the clinical trials done on those medicines. Part of this has been due to the need to protect the information on people who are part of the clinical trials. And part of it is due to reporting bias: trials with positive results are about twice as likely to get published as those with negative results. Yet the medical industry as a major stakeholder is becoming clearer on the fact that both the positive and negative data are crucial to proper use of existing medicines.

In the past few years more stakeholder voices – including the European Ombudsman – have called for 100% transparency from pharmaceutical companies around this trial data.
Physician Ben Goldacre founded Alltrials in 2013, a non-profit whose goal is simple: all clinical trials on humans registered, and all results reported, especially for drugs that are in use on people today. Scores of organisations supported Goldacre and Alltrials’ efforts, yet notably, few commercial companies are among them. GSK is an exception: it was the first to sign its support and to publish the clinical study reports that give detailed information on designs, methods and results of trials.

“Over a number of years we have been moving to share more info about clinical trial data,” says GSK’s Griffin. “In 2013 we signed up to the Alltrials campaign, and we decided to make our anonymized patient-level data available to other researchers.”

GSK created its own portal for researchers to request data. At the same time, the European Federation of Pharmaceutical Industries and Associations and its sister organisation PhRMA in the US made commitments on clinical trials data transparency and in May of this year launched

Clinical trial data is becoming available to researchers

The European Medicine Association (EMA) said this attempt at self-regulation on clinical data was not enough, and Alltrials said pharmaceutical companies should not be in control of access. EMA has therefore said it will begin to publish the reports that underpin approvals for new drugs going on the market.

Ben Goldacre isn’t impressed by EMA’s announcement, though, mainly because EMA will control reports for only a small portion of the drugs in use today, and the EMA’s policy includes allowing “commercially important information” to be redacted from those trial reports.

What would other industries do?

Jennifer Miller says a rating system on the transparency of pharmaceutical companies is the next step to restoring trust and facilitating “Big Transparency” in Big Pharma. Miller says other industries – and, within healthcare, hospitals – have ratings, accreditations and rankings to inform and reassure stakeholders.

She puts the ethical concerns about pharmaceutical companies in five categories: clinical trials designs; how trials are conducted; reporting of trial results; marketing issues for drugs including payouts; and the accessibility of medicines. Right now, Miller is working on one of those five, clinical trial results reporting, having designed a pilot project to create and index pharmaceutical companies’ transparency in this area. Using publicly available data, she has ranked companies from the best (100% reporting) down to the worst (reporting about 6% of trials results) and is working on how to release that information into the public domain.

“Sunlight is a good disinfectant, as is naming and faming good practices while shaming bad ones,” Miller says. She acknowledges the work to be done on getting a good rating system for all five areas could take some time, but says pharmaceutical companies should welcome the opportunity to show that they really are walking their talk.

Of course, full disclosure and Big Transparency are rarely comfortable. GSK, for example, has touted its leadership in signing Alltrials, and in releasing clinical trials data, but it turns out that this trials disclosure wasn’t exactly GSK’s forward-thinking initiative. Back in 2004, full disclosure was part of settlement of a lawsuit that US attorney general Eliot Spitzer filed against the company around its antidepressant drug Paxil. To quickly settle the suit, in which Spitzer claimed GSK misled doctors about Paxil’s adverse effects on children, the company became the first major drug 

Ebola, politics, and Big Pharma

The Ebola virus is definitely big news, stealing large portions of media air space.

Yet Ebola is officially a “neglected tropical disease” (NTD), one of many NTDs that need new and improved drugs for their prevention and treatment but get little attention from pharmaceutical companies.

This is perhaps understandable: with the average cost of a major pharmaceutical company getting a drug to market standing at about $4bn according to analysis by Forbes magazine, treatments that are not going to bring a return on that investment are low on drug companies’ priority list.

Ebolanomics stalled vaccine development

“This is just the way that the free market works,” science writer and researcher Leigh Philips said in a DemocracyNow interview in mid-October. “Ebola is like many other unprofitable diseases – if we’re going to resolve the situation we’re basically going to cure it. Compare that to insulin for diabetes or other drugs people might need to take for the rest of their lives. Are pharmaceutical companies going to invest in a product that may have a low return on investment or none at all, or something that will have a high return? It’s a bit of a no-brainer.”

The case of Ebola just points out what Philips sees as an overwhelming problem with pharmaceutical companies – staggering research and development costs go to develop profitable drugs, and in shareholder-driven companies there’s no mechanism to ensure that revenues from profitable drugs go to development of drugs for the unprofitable diseases.

That doesn’t mean they aren’t being developed at all, however. In Ebola’s case there are currently five viable vaccine candidates, and GlaxoSmithKline is developing one of them.

“We are liaising with leaders coordinating the international response, and our response is two-fold,” says GSK spokeswoman Clare Griffin. “Product donations to primary countries affected … the development of early-stage, vaccine candidate Phase I clinical trials in the US, UK, and Mali.”

The World Health Organization (WHO) is pressing pharmaceutical companies to work faster to give the world solutions to Ebola, and the media is now reporting a race between companies to provide them.

But racing towards Ebola drugs has many ethical dilemmas, not least the thorny issue of rushing the trials that will determine safety and efficacy of vaccines and treatment medicines.
“The normal process is long and complex and very difficult to accelerate,” says GSK’s Griffin. “Yet this is also a very fast-moving situation. There is a significant health need, and it’s up to WHO to assess that and the requests of companies and regulators to work together to expedite what otherwise may take years.”

“Ebolanomics”, as one New Yorker writer termed it, means pharmaceutical companies were slow to get going, but now that the race is on, innovation on how to fund it may not be far behind. Small pharmaceutical company Pentamer, for instance, has launched an Indiegogo crowdfunding campaign to finance its work on a new vaccine, called Nobola. 

GSK  Novo Nordisk  pharmaceutical sustainability  pharmaceuticals  Sanofi  transparency 

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