Legal and Ethical Considerations in Marketing, Product Safety, and Intellectual Property

Advertising is one of the most powerful tools of marketing, which ministers to the devout side of doing business. It is a component of the greater effort of redemption and regeneration of mankind. Successful advertising and marketing is considered as the only way to prosper in the business world. Successful advertising and marketing in the modern business world entails efficiency, effectiveness, and ethical practices in the process of sales promotion. In this context, one major ethical issue associated with marketing and advertising is the entire notion of false advertising that some companies often use to advertise and market their goods and services. False advertising provides misleading information to consumers, thus an ethical issue. Consumers often put their trust on some companies alongside the products they produce and offer in the market
. Such companies will be operating unethically if at all they engage in false and misleading methods of marketing and advertising their products.
In regard to intellectual property, an ethical issue would occur if one  gets involved in such practice as encroachment of copyrights or other things that other people have done and presenting it as an original masterpiece. However, a scenario involving copyright encroachment raises questions regarding whether the defendant copied from the original, or whether the claimant really owned the copyrighted piece. An ethical concern associated with the regulation of commodity safety may involve the correct labeling of products, and the assurance that all ingredients making up the commodity conform to the requirements of the Food and drug Administration (FDA). This is a concern to a range of pharmaceutical firms that advertise and market their products without the approval of FDA. In the United States, patents, trademarks, and copyrights are deemed intellectual property, and companies that engage in unauthorized use of such aspects are considered unethical and illegal. This may not be the case in other countries outside the US, sometimes due to cultural aspects of that country.
Direct-to-Consumer Marketing by Pharmaceutical Companies
Over the years, the use of direct-to-consumer advertising has been on a rapid increase among pharmaceutical companies. Currently, it is the most prominent form of advertising that the society encounters. The FDA normalizes the practice, but critics claim that the FDA rules are insufficiently inflicted and too relaxed. There may be limited availability of data relating to the issue, but research indicates that DTC is both beneficial and injurious to the health of the public. The intensity of arguments for or against DTC is rather equally balanced, and the ideas suggested by both sides can be sustained with substantial evidence. There are frequent calls to outlaw or severely curb consumer drug publicity, but strategies to minimize risks associated with DTC and maximize the gains are more often advocated (Schweitzer, 2007).
Proponents of DTC underscore that the practice educates, empowers, and informs patients and enables them to take charge of their welfare. Informing the consumers through DTC also helps benefit the drive for reforms in the healthcare system. It is claimed also that DTC promotes patient-clinician contact as it prompts patients to seek advice from healthcare providers. A survey carried out by the FDA reported that the exposure of consumers to DTC prompted about 27 percent of US citizens to consult their doctors to seek medical advice on conditions they had not discussed before. Following such consultations, it is apparent that DTC promotes the dialogue between healthcare providers and their patients, which in turn strengthens the relationship between them. Other proponents of DTC base their claims on economic opinions and theory to emphasize that the practice encourages competition among different companies thus promoting lower prices of products. Obviously, advertisements motivate competition that results in lower prices for prescription drugs (Schweitzer, 2007).
On the other hand, critics of DTC marketing claim that DTC advertising and marketing misinforms consumers as it often omits important information, for example, the side effects of the drugs. They also claim that DTC marketing overemphasizes the potential benefits of drugs over the risks associated with the same drugs. According to the Journal of Health Communication (2007), average television commercials related to DTC dedicates more time to drug benefits than to risks (Nelson, 2007). Additionally, some opponents claim that DTC promotes the sale and consumption of new drugs prior to the familiarization of its associated safety profiles, especially in the case of first-in class pharmaceutical products. Some critics have claimed that DTC marketing leads to improper drug prescriptions. This is because in some cases, a patient may decide to hold back information in order to fit a specific profile that they may have seen in a DTC advertisement in an attempt to convince the clinician to prescribe a drug of choice that might be unsuitable for their condition. In such cases, the doctor may not have another option but to prescribe the drug to facilitate accommodation of their patients request.
Regulation of compounding pharmacies
In the US, states are the chief supervisory body of pharmacies, and this engrosses in-store pharmaceutical counters, community medicine stores, specialty pharmacies, and large pharmaceutical chains. Every state around the US has laws and regulations in place to guide the standards and requirements of all pharmacies. These laws address issues such as the compulsory licenses for any facility, the officially documented pharmacist, as well as other employees who work in the facility. However, the FDA regulates almost the entire commercial pharmaceutical production. In this scenario, the FDA could have implemented the provisions of Drug Quality and Security Act to standardize the specialty altered drugs (O'Donnell, 2005). The FDA could have used its powers to ensure that all compounding pharmacies register with FDA, and also initiate a system to record the nationwide drug supply chain. FDA should be granted more power over compounding pharmacies in order to reduce the risks of diversion, contamination, counterfeiting, or adulteration of pharmaceuticals.
PharmaCARE in Colberia
The intellectual property acquired by PharmaCARE in Colberia goes against the hedonism that should accompany utilitarianism as the process has caused some adverse impacts on the local residents of Colberia. The extensive activities of the company have destroyed the environment and endangered the indigenous species in the African nation of Colberia, which is unethical according to the views of the utilitarian school of thought. PharmaCAREs activities are also unethical in regard to the deontology views. This is because as a foreign investor in the country, PharmaCARE has an obligation of improving the living standards of Colberian residents, but this is not the actual case as the residents live in poor primitive conditions while the organizations executives dwell in luxurious compounds. In accordance to virtue ethics, the decision of PharmaCARE to find indigenous cure to various diseases is ethical as it is morally right and would derive benefits to many people, including the locals. The Colberian community has been affected negatively by PharmaCAREs intellectual property in the country. It has been reported that since the company launched its activities in the country, both the environment and the people have suffered greatly (British Columbia Pharmacare, 2003). According to the ethics of care, PharmaCARE should show some extra positive concern towards the vulnerable Colberian community, but it does not. This is not ethical according to the theory. Personally, I view that the Colberians are overworked, but underpaid. Their living standards are also of low or poor quality compared to those of the organizations executives. This is unethical in my personal ethical compass, as one would feel demoralized by the look of the difference in living conditions between the two groups of people. I would advocate that PharmaCARE engage in some form of corporate social responsibility to alleviate the living conditions of the locals as well as improve the environmental conditions of the endangered native species in Colberia.
Colberia is a low-income nation in the African continent. PharmaCARE is a New Jersey-based company that provides discounted and free drugs to consumers who earn low incomes, which make the organizations activities to fit well in the Colberian setting. PharmaCARE also provides educational-based assistance to the US citizens as well as the rest of the world ( British Columbia Pharmacare, 2003). In order to uphold its original intellectual property in the mother country as well as in Colberia, PharmaCARE recently established an initiative aimed at environmental conservation through green initiatives, among them recycling and changes in packaging. This has prevailed despite the fact that lobbying efforts by the company have lucratively conquered environmental rules and regulations that encompass extension of the US superfund tax.
Because the company aims at finding indigenous drugs to cure a range of diseases by involving some Colberian indigenous medical experts, it has constructed up-to standard facilities and laboratories to cater for the activities. The organization has also launched a fully owned subsidiary company in the US, a move whose main aim is to evade scrutiny by the FDA ( British Columbia Pharmacare, 2003). The subsidiary, known as CompCARE, is meant to function as a compounding pharmacy that will be involved in the sale of invented formulations to persons on based on prescription. The subsidiary company has already established a shop near the parent company in order to save capital and time. The organization makes use of the US law to safeguard its activities and intellectual property in both countries of operation. Furthermore, increasing the scope of operation and the related production activities grants the organization some additional advantages regarding conservation of its intellectual property.
Suggest at least three (3) ways the company could compensate the people and nation of Colberia for the use of its intellectual property and the damage to its environment.
The single greatest obstacle to economic development and the betterment of society is corruption. The operation of PharmaCARE in Colberia is manifest of the hyper-corruption prevailing in the country. The corruption of both regulating agencies in overlooking the behavior of the company and the companys conduct towards its employees and environment despite its brand results in injustices and extreme poverty for the many people in Colberia dependent on the company as a source of employment. This behavior diminishes the possibility of amicable co-existence with the community in which the company operates. In light of these considerations, it is imperative that PharmaCARE addresses its interactions with the environment and the Colberia people to achieve sustainability. The company must ensure that any individual within the vicinity of the plant or who works for the company and have suffered health related problems because of the emissions and toxic substances released by the industry is treated. Thos that have suffered irreversible damage must get full compensation form the company (Andersen, 2004).
The indigenous knowledge and the biodiversity of the people of Colberia is at risk because the current intellectual property laws protect cultural and community knowledge and wealth. Unlike the western culture that is based on individualism and commercial gains, the Colberia people have a more communal culture that encourage the sharing of information for the betterment of everyone in the community. The entry of CompCARE in Colberia, which is a subsidiary of PharmaCARE exploits natives of the country. The residents of the country readily share the biological products they have in the country with the company only for the company to commercialize the products without paying any compensation to the people. To ensure the company operates fairly, the indigenous community in the country must receive recognition for their contribution and knowledge in the production of PharmaCARE products. The communities must also share equitably form the benefits resulting in the use of these native knowledge and products (Werther & Chandler, 2010).
Compare PharmaCAREs actions with those of at least one (1) real-world company whose creativity in skirting legal technicalities led to ethical lapses and financial loss.
PharmaCARE actions of marketing drugs without revealing the entire effect of those drugs on the human body is a common practice in pharmaceutical companies. Another company that suffered financial losses for marketing drugs for unapproved uses and without revealing the true effects of the drugs is GlaxoSmithKline (GSK). The company recently paid a three billion dollar settlement in civil and criminal fines after pleading guilty to misdemeanor charges related to the sale of Paxil and Wellbutrin antidepressants; and Avandia, a diabetes drug. The company misbranded the antidepressant drugs and sold them for uses not approved by the Food and Drugs Administration (FDA). These include the treatment of depression in children, anxiety, addiction, obesity, and ADHD. There is no concrete evidence that indicate the drugs are capable of treating these ailments, however, the company marketed the drugs despite numerous warnings about the increased risk of suicide for minors. The company also withheld information from the FDA about their diabetes drug Avandia. Clinical trials of this drug reveal that the drug increases increase the risk of developing heart related complications (Thomas & Schmit, 2012).
Determine the success PharmaCARE and WellCo shareholders would have in suits against the companies.
CompeCARE is a subsidiary of PharmaCARE and operates in Colberia. The day-to-day operation of the subsidiary is far from the image the company portrays to the shareholders. PharmaCARE shareholders receive the wrong information about how the profits the company realizes each year are made. The environment conservation initiative that the company is so proud of is a public relation program with no real value of the ground. This environmental conservation hoax serves as a channel through which part of the companys money is lost because the project does not improve the environment nor does the company attempt to improve its operations (Andersen, 2004). The shareholders can sue the executives for providing misleading information to the shareholders who would most likely not support the operation of the company and the use of their money in such a way.
The shareholders of WellCo could also easily sue the company for purchasing CompCARE with the full knowledge that the company does not operate in a sustainable manner. Purchasing such a company not only amount to poor investment decision by the executive, but also unethical investment because the operation of the company destroys the lives of the Colberia people. The shareholders of both PharmaCARE and WellCo could successfully sue for unethical behavior. The shareholders could also successfully sue on the ground of misleading information from the executives. The shareholders have the right to know how their money is spent (Switzer & Bulan, 2002).
Determine whether PharmaCARE lives up to its brand. Support the response.
PharmaCARE has a patient-centric brand that seeks to improve the lives of the patient as a stakeholder of the company. The employees who are also important stakeholders in the company do not get much attention. A close examination of how the company treats its employees reveal that the company treats the top executive very generously, however, the low-level employees, who are also the native citizens of Colberia, treatment is wanting. The company fails in achieving its brand goals because it the employees have neither comfortable working conditions, nor affordable healthcare (Werther & Chandler, 2010). The major challenge facing PharmaCARE ability to deliver to the people of Colberia is because the pharmaceutical company is designed to operate in the high-end market where the profit margins are high and the consumers have the purchasing capacity. Because much of the population in Colberia is poor, the company does not bother to deliver the essential healthcare necessary to the people of the country despite the companys operation in the country resulting in the poor health of the residents in the country.
The patients who are the focus of the company also suffer from the incompetence of the company. The company is accused of supplying harmful drugs to the market that increase the possibility of cardiac arrest in a patient. The purported environmental stewardship initiative that the company operates is a public relation gimmick with no real results on the ground. The lobby groups in Colberia are opposed to the operation of the company in the country because of the company operates in an unethical and social unacceptable manner. Therefore, the company has no moral authority to spearhead the environmental conservation efforts because the health of its workers continues to deteriorate despite the efforts that the company purports to put towards the conservation of the environment (Werther & Chandler, 2010).
Recommend at least three (3) changes PharmaCARE can make to be more ethical going forward.
PharmaCARE must take responsibility for its actions and ensure that the health of the employee is a priority. CompCARE, which PharmaCARE subsidiary in the country must take responsibility of the health of the workers and ensure their prompt treatment. After ensuring the health of the employees is taken care of, the company must change it practices to ensure it no longer exploits the environment or employees in an unsustainable manner. The employees must receive salaries that are commensurate with the tasks they handle at the company. The company must also initiate an environment cleanup program that will seek to reverse the effects the company has had on the environment and restore it to its previous state. The employees affected by the poor decisions of the management must receive compensation for the suffering they had to go through because of bringing their plight to the attention of the management. Finally, the company must compensate the community that lives around the plant for the harm caused to not only the people but also other organisms that the people around the area depend on. The company must have community initiatives that seek to improve the live hood of the people around the plant by contributing to the major economic activities in the area. Such activities will not only enable the company to operate sustainable within the community, but also will make the company part of the community in which it operates (Andersen, 2004).
The company must operate in an ethical manner and ensure that the local people get credit for their products and knowledge. The western intellectual property laws do not cover cultural and communal knowledge and wealth. This creates a loophole for unethical companies to exploit and profit from poor communities that lack the ability to commercialize their knowledge (Switzer & Bulan, 2002). Although it is not a legal requirement for the company to give credit to the local people for their knowledge and products, the company must live up to its brand name and provide compensation to the people of Colberia. Colberia is the source of the drugs and products that reveal pain and suffering in other parts of the world, however, the people of Colberia suffer from diseases that the drugs produced by the company at treat but they cannot afford. The company must ensure that their products are available to the people of Colberia by providing subsidized products as part of the compensation.
Conclusion
Many pharmaceutical companies do not adhere to compliance marketing and selling. In most of the cases, the executive is always under pressure from the shareholders to perform. This translates to increasing the sales of drugs and reducing the production cost of the drugs. The executive results in unethical behavior, such as misbranding and poor working conditions for the low-end workers. To improve performs of the companies in the compliance marketing and selling issue, the companies must revise the payment terms of sales representatives and when necessary fire employees who engage in misconduct.








References
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Schweitzer, S. O. (2007). Pharmaceutical economics and policy. New York: Oxford Univ. Press.
Switzer, C. S., & Bulan, L. A. (2002). CERCLA: Comprehensive Environmental Response, Compensation, and Liability Act. Chicago, Ill: Section of Environment, Energy, and Resources, American Bar Association.
Werther, W. B. & Chandler, D. (2010). Strategic corporate social responsibility. Thousand Oaks: SAGE Publications.