Drug Dilemma

Drug Dilemmas

A Paper Presented To

Dr. Sonnier

In partial fulfillment of the requirements of

ECBU 343, Foundations of Business Ethics

University of La Verne

College of Business and Public Management

Jennifer Schaefer

La Verne, California

July 14, 2015

Introduction

In the case of “Drug Dilemmas” it is explained in the text book (Moral Issues in Business Shaw and Barry) that there is a much higher cost for prescription drugs in the United States verses other countries such as Canada and Europe. Over the past two decades the pharmaceutical industry has become the most profitable sector of the American economy, yielding as high as fifty four percent (Statista, Wilson Library). The American people resent the huge profit margins that these companies yield versus other companies in this country including their own, I’m sure. It is also explained that the cost of research, development and marketing is less that fifteen percent of the total sales and revenue of these large pharmaceutical companies. These companies have only produced a handful of new drugs in recent years. The research associated with these “new drugs” is funded by taxpayer dollars. Funding for clinical research comes from the federal government such as the National Institutes of Health, the Department of Defense, the Department of Veteran's Affairs, and private industry such as pharmaceutical and biotech companies, medical institutions, and foundations The majority of these new drugs are not new at all, but slightly different versions of drugs that are currently on the market. This a “me too” marketing strategy targeting the current customer base. The FDA does not require each improved drug to be re-tested in the same manner as the first. In a recent year, seventy eight drugs were approved by the FDA, only seventeen contained new active ingredients. Only seven of those were classified as an improvement over the older...