The Unethical Business Practices of Pharmaceutical Giants

If someone asked a random person on the street about sildenafil, esomeprazole, atorvastatin, or ranitidine, the person would probably have no clue what those chemicals were. However, ask the same thing about Viagra, Nexium, Lipitor, or Zantec and the person would know at least one of those drugs. In 1997, the Food and Drug Administration allowed the marketing of drugs directly to consumers through media such as television, making the United States one of the only countries to outright allow this. Advertising for drugs has a direct impact on the health of whoever buys the drug. Pharmaceutical giants continue to shell out millions of dollars for direct-to-consumer advertising every year. Often times, the advertising directly leads to a sharp increase in sales which nullifies the costs of advertising, research, and development. Pharmaceutical companies ultimately victimize and deceive consumers through rampant false advertising, distorted statistics, and the advantageous manipulation of loose FDA regulations using shady business practices.

False advertising done by pharmaceutical companies deceives consumers by selectively omitting vital information and utilizing opinions over facts. The main issue today with pharmaceuticals is the insane amount of advertising done by the companies. In 2003 alone, a grand total of $3.2 billion was spent on advertising in just the United States. Between the dawn of pharmaceutical direct-to-consumer advertising in 1997 and 2003, the pharmaceutical industry took the title of tenth largest advertiser in the United States (Lansing, Paul, and Fricke). Of course, the amount of money spent on advertising for drugs definitely has its benefits for the companies. A report by Congressional investigators showed that there was a direct correlation between drug advertising to consumers and the increase in requests and the use of said prescription drugs. In fact, at least 8.5 million Americans get prescriptions for heavily advertised drugs each year (Gottlieb). There is nothing inherently wrong with advertising, however false or dishonest advertising crosses the line. The risk of misled consumers due to unreleased side effects would be lowered if the FDA screened ads before they appear on television. Unfortunately, this process would cost companies a large amount of money and also extend the drug development and approval process which is currently as long as 12 years (FDA Approvals). The compromise between pharmaceutical companies and the FDA was that the FDA would not review ads until they air (Plackett). Pharmaceutical companies would also be responsible for conducting tests on the proposed drug. Of course, this has its drawbacks. Although this does promote some healthy capitalism, it also inevitably leads to an unhealthy dose of unethical business practices. It ends up falling upon viewers to report any inconsistencies to the FDA unless FDA reviewers spot misleading claims ahead of time. Between 1997 and 2002, the FDA issued 88 citations that ordered the takedown of several drug companies’ commercials (Gottlieb). A common trend seems to be ads for counter drugs (OTC) are more dishonest than those for prescription drugs. . As Claritin, an allergy medicine, transitioned from being a prescription drug to an OTC drug, the commercials made “six times more claims for the benefits of the drug” (Plackett). Due to the ease of buying OTC drugs, pharmaceutical companies rely more on brand knowledge and the positives of advertised drugs This broad false advertising is of course not just limited to a few specific brands. In a study done by researchers for the Journal of General Internal Medicine, 168 commercials from a two year period between 2008 and 2010 were selected. 84 were for well-known prescription drugs, and 84 were for well-known OTC drugs. All of these commercials aired on ABC, CBS, NBC, and CNN; all major news networks. The researchers found that only 33% of the claims made by the advertisements were completely truthful (Perry). Many of these claims point to a larger issue, the issue of the use of distorted statistics.

Pharmaceutical companies continuously use distorted statistics in order to produce a false image of their product and create false expectations in the minds of consumers. Brand loyalty is one of the biggest ways companies market products to consumers. It is no different for pharmaceutical companies. Besides using easy to remember slogans such as “Levitra works for me, maybe it can work for you” or “the everyday pain reliever (Advil),” companies often use untruthful statistics on both TV and in printed materials (Perry). These statistics often pass as legitimate to the viewer as the ad runs for however many seconds on television or at a glance on a newspaper page, but many times the pretty graphs and other visual aspects of the ad are often there to psychologically make the viewer feel more positive about the drug. Graphs and tables are often used to provide clear and memorable summaries of study results to the viewer. These are often likely to lead a consumer to misleading conclusions (Lexchin). These visuals allow for the possibility of misleading doctors into recommending certain drugs to patients. Sometimes, the visuals provided in advertisements by pharmaceutical companies are completely nonsensical or unfounded. In a study done at UCLA, doctors analyzed the quality of 484 advertisements, 63 of which had a total of 74 graphs. The results showed that 64% of these graphs had no sufficient information related to the drug, 47% had no keys or legends, 36% were numerically distorted so consumers would overestimate the effectiveness, and 31% provided no sample sizes (Cooper). This problem not only persists in advertisements intended for consumers. The advertisements in published medical journals often suffer from the same ailment. In another study done by doctors in internal medicine, the results indicated that out of 27 advertisements in 10 leading American medical journals, 8 advertisements had statistics that were from inconclusive or poorly designed studies (Wilkes, Doblin, and Shapiro). Obviously this ends up influencing doctors’ opinions as well. No longer does the industry need to rely on lobbyists. According to Dr. Alan Steinberg, Research Director for NOP World Health “physicians are very likely to grant patients’ requests for advertised brands” (Lansing, Paul, and Fricke). The advertisements created by pharmaceutical companies end up manipulating consumers by giving them false information regarding the effects of the drug being sold. Not only does the industry do this through statistical information, they also subconsciously imply the positive life changes that come with using the advertised drug. For example, in 2004 the FDA forced Pfizer to withdraw advertisements for Viagra. The ads made the false claim that Viagra can restore sexual desire for the consumer (Lansing, Paul, and Fricke). The advertisement also included themes such as happiness, a good American lifestyle, and other things that appeal to male tastes. The amount of advertising done for Viagra is clearly profitable for Pfizer however. With $111.6 million spent on advertising, the drug brought in $1.88 billion in revenue for the company (Lansing, Paul, and Fricke). Drug company AstraZeneca was also forced to take down an advertisement for Crestor that falsely claimed the FDA had “confidence in the safety and efficacy” of the drug (Payne). There is not much to lose for a pharmaceutical company if the sales continue to bring in a large amount of revenue that negates any fines or takedowns given by the FDA. Unfortunately, the low amount of regulation before the airing of advertisements merely makes it easier for pharmaceutical companies to continue this course of action.

Loose government regulations on the drug industry result in pharmaceutical companies taking advantage of loopholes and using underhanded tactics to release potentially dangerous and overpriced drugs to consumers. Thanks to the deal with the FDA, pharmaceutical companies now have complete control over the process from drug development to clinical trials to data publication (Moncrieff). Although some drug companies do submit their findings to the FDA for review before airing advertisements, a large amount still withhold the information unless they are forced to hand it over due to a post-release issue. During the 1960’s, most clinical trials for pharmaceutical products were funded by the government and done by public institutions. However, nowadays the clinical trials go through Contract Research Organizations. As the name implies, CROs contract out their services to pharmaceutical companies. These organizations along with academic research centers actively compete in order to do research for pharmaceutical industry giants (Bodenheimer). The problem with research done by CROs is obvious. Though they claim to be heavily regulated, CROs and other centers that hire out research services have to compete by getting favorable results to secure future business. This inevitably tips the scales in favor of the pharmaceutical industry. This is not the only shady tactic employed by pharmaceutical giants. Earlier on, incomplete or irrelevant statistics was found to be an issue with graphs and claims made in advertisements. Although pharmaceutical clinical trials were found to be “four times more likely to have a positive result over independently conducted trials,” and the methods used were better, the industry funded trials actually removed negative data to make their trials look better (Goldacre). This is a major problem. The average consumer has no clue whether or not the results shown in ads are true or not without extensive research. Usually, there is not a way for the average consumer to get the source of the results in the first place. Along with failing to publish negative test results, pharmaceutical companies end up selectively presenting favorable study results and publishing them multiple times under different names to increase the illusion of legitimacy (Moncrieff). One final tactic that the industry utilizes is paying doctors under the table to prescribe or endorse their drugs. In an investigation done by multiple journalists from institutions like NPR, PBS, and Consumer Reports, it was found that pharmaceutical companies paid out millions of dollars to corrupt doctors, many with histories of misconduct. In 2005, Wyeth owned by Pfizer, was the defendant of a federal court case that involved the company paying doctors based on how much they “prescribed the kidney transplant rejection drug Rapamune” (Ornstein, Charles, and Weber). Those representatives who were even unenthusiastic about Rapamune were reeducated by the company to promote the drug more favorably. In 2009, Pfizer ended up paying $2.3 billion in reparations. In an interview by the New York Times with Harvard-educated Dr. Stefan Kruszewski, he admitted to being paid at least $1,000 or more every time he promoted the drug by talking to another doctor (Wilson). He promoted drugs for giants Pfizer, GlaxoSmithKline, and Johnson & Johnson. Eventually, he refused to continue promoting for these companies. Unfortunately, these unethical business practices still run rampant in the drug industry and it does not look like they will stop anytime soon.

Although the industry utilizes unethical and dishonest practices to push their products, the pharmaceutical industry’s quick growth accounts for the appearance of new and improved technologies and efficient cures. Over the past decade, the pharmaceutical industry has poured millions and millions of dollars into researching new technologies to keep up with the increasing demand for efficient drugs. When Pfizer bought Wyeth Research & Development, they opened up two brand new research divisions. One was PharmaTherapeutics to focus on the discovery of small molecules and the ability to directly use them in therapies. Their new BioTherapeutics division focuses on large-scale research and the creation of new vaccines (Pfizer Company History). Pfizer also began to start devoting some divisions to stem cell research. That is just one current example of a company advancing medical research. Other big pharmaceutical companies such as Johnson & Johnson and GlaxoSmithKline are also doing the same thing. Pharmaceutical companies devote a higher percentage of their budget, 20%, to research than any other major industry in the United States (Gregory). Without the massive profits that pharmaceutical companies bring in, in part due to advertising, there would be no more incentive to innovate, not to mention that they would have a significantly smaller portion of their budgets to devote to research and development. Without these companies and their research, the world would not have medicines such as AZT, a drug used to treat viral replication of HIV (Rogers). AZT, or Retrovir, was developed by GlaxoSmithKline in conjunction with other scientists. The world would also be without t-PA, tissue plasminogen activators that prevent and break down blood clots (Activase). t-PA medication is developed and produced by Genentech under the brand name Activase. Genentech is a large biotechnology company that operates under Hoffman-La Roche, an international Swiss pharmaceutical giant. Human scientific growth has come a long way within the last fifty years due in part to the efforts and profits of the pharmaceutical industry.

Although the pharmaceutical industry is responsible for many medical advances, it still does not completely excuse them from their business practices. These companies end up manipulating customers through false advertising, dishonest statistics and trials, and the use of underhanded business practices. The main source of revenue for pharmaceutical companies is through advertising. Advertising has a direct correlation with the purchasing habits of consumers. Many times, the advertising done by pharmaceutical companies has false information that can deceive the customer. In addition, the clinical trials done by these companies’ research divisions may not be truthful as the results are often distorted by changing numbers or outright trashing unfavorable results. Other times, pharmaceutical giants with money to spare bribe medical professionals and other companies to promote their drugs at the risk of dangerous complications to the consumer. At this stage, these business practices can be difficult to stop. Food and Drug Administration regulations are currently relaxed for drugs after the approval process, and the FDA does not really do anything about false advertising unless they are explicitly notified about it. Unfortunately, a forced change in pharmaceutical business practices would be at the expense of rapid future development in the medical field and also the loss of jobs as companies will lose money. This is something the United States cannot risk changing right now, but perhaps in the future changes can be gradually introduced to benefit the consumer.