Pharmaceutical industry: Tight regulation key to curbing unethical practices

malpractices by pharmaceutical industry
The pharmaceutical industry seems incapable of self-regulation and ethical leadership, given its terrible reputation and failure to abide by the pharma code.

It is high time the government put in place a stringent code of ethics for the pharmaceutical industry to put an end to bribery and other unethical practices. Medicines are key to a person’s defence against ailments. The poorer sections of the society spend a major part of their earnings on medical treatment. Thus, unethical practices followed by some pharma companies to inflate prices of popular formulations must be stopped at any cost.

The latest in the string of such controversies is about Micro Labs which is charged with offering doctors freebies worth Rs 1,000 crore in one year to promote Dolo-650, an over-the-counter paracetamol tablet. Such controversies destroy consumers’ trust in medicines and doctors. This controversy may be the tip of an iceberg. Drug manufacturers spend thousands of crores of rupees to bribe doctors to promote their medicines despite the existence of the Uniform Code of Pharmaceutical Marketing Practices since 2015.

The code was introduced as a set of voluntary rules to stop the industry and their representatives from bribing doctors with gifts and money to boost sales and profit. However, these regulations can be broken without fear of severe consequences. The Dolo-650 case is currently being heard by the Supreme Court.

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The role of pharmaceutical industry

The Indian pharmaceutical market is the third largest by volume and the 14th by value globally. India is the world’s 12th-largest exporter of medical products and more than 200 nations across the globe import Indian pharmaceuticals. Pharma companies discover, develop, and produce drugs and treatments that can be used to prevent diseases and to save lives. Yet, many of these companies use doctors as their brand promoters to make a higher profit or to beat their rivals.

Pharma companies offer expensive gifts such as foreign trips along with spouses/ families, LED TVs, air conditioners, refrigerators, laptops, and other equipment to doctors in lieu of prescribing their medications and nutritional supplements. To repay the goodies, doctors prescribe nonessential drugs and more expensive alternatives.

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Freebies during Covid-19 pandemic

The Covid-19 pandemic exposed the deeply ingrained corruption in pharmaceutical marketing. During the pandemic, costly Remdesivir injections were carelessly prescribed for patients, even though there was no scientific evidence to support their efficacy in treating Covid. This is another instance in addition to the Dolo example.

Such practices violate the common citizen consumer’s right to life and health. It is not just about Dolo or Remdesivir. The freebie culture that has persisted in the pharmaceutical industry for a while has created trust issues in people’s minds about the medical fraternity.

Impact of freebies on patients’ pockets

The patient’s health is affected by the prescription of medications. Doctors prescribe high-power doses, and non-scheduled drugs not covered under the Drug Price Control Order (DPCO). The adverse effects of these medications on patients’ health are noticeable only after a long time.

Doctors prescribe medicines such as multivitamins and becosules even when they are not needed. This practice increases medicine consumption and force patients to incur high expenses on buying unwanted medication.

History of penalties on pharma companies

In the US, 22 pharmaceutical companies were slapped $33 billion in financial penalties between 2003 and 2016 for engaging in unethical business activities. Only four of the 26 large pharmaceutical companies covered by the study were not fined.

Another study in the United States in 2019 emphasised that small gifts from pharmaceutical companies significantly influence doctors’ behaviour. According to the study, freebies contribute to increased opioid prescribing and overdose deaths resulting from profiteering by pharmaceutical firms and doctors. The study showed that 76,000 persons died from opioid overdoses, and researchers discovered that prescribing rates and deaths were greater in regions with focused marketing.

The Competition Commission of India imposed penalties worth Rs 46.43 crore on three pharmaceutical companies — Glenmark, Divine Saviour, and Hetero Healthcare – in 2018 for indulging in unethical business practices. In 2019, the Competition Commission imposed fines worth Rs 74 crore on four pharmaceutical companies for stifling competition, preventing consumers from accessing various products, and reducing the availability of medications.

These are only a few examples demonstrating that penalties have not effectively curtailed unethical behaviour. The industry seems incapable of self-regulation and ethical leadership, given its terrible reputation and failure to abide by the pharma code. Strict regulation and stringent punishments are necessary to compel the pharma industry and healthcare practitioners to stop unethical behaviour, and to create a better medical environment that helps build consumer confidence and trust.

(Pradeep S. Mehta is Secretary General and Pratibha Jain is Programme Associate at CUTS International, a global public policy research and consumer advocacy organisation.)

Secretary General, CUTS International at CUTS International | Website

Pradeep S Mehta is the Secretary General of CUTS International, a leading policy research and advocacy group. He is a featured columnist with several leading publications in the country.