Abstract
The war against
aging has been waged for as long as we know. One of the most prominent battles
within this war is the fight against memory loss. As people age their brains
begin to deteriorate, leading to absentmindedness, decreased ability to
multitask, difficulty with name and face recognition, along with other side
effects. The race to create a drug that can reverse or even halt neurological
diseases and age induced memory loss has been booming with advancements in the
study of memory. Spear heading this race is a company called Quincy Bioscience
and their exceedingly popular supplement, Prevagen. Although it has boosted
revenue and sales for years, the Food and Drug Administration (FDA) and other
agencies have questioned its safety and efficacy. Quincy Bioscience is now
being tried for false/misleading advertising, creating improper procedures
during production, and not specifying how it controlled production, which would
all ensure quality and safety for consumers.
 |
| Prevagen uses protein found in jellyfish |
When analyzing
this through the lens of the ethical theories, they would vary in responses.
Individualists, who believe the only ethical responsibility is to increase
profits of the owners, within the law, would not condemn Quincy Bioscience.
They would applaud the company’s use of loopholes to remain within the law while
maximizing profits. Utilitarianism argues that one must maximize the happiness
for the majority of people to be ethical. Using this theory, a utilitarian
would disapprove of this company’s practices because the majority of the people
effected are the stakeholders and they are negatively impacted, leading to
decreased happiness. The Kantian ethical theory analyzes the motivations and
reasonings behind someone’s actions to tell if it was ethical or not. In this
case a Kantian can argue that the founders of Prevagen are not ethical because
their motivation to create this supplement was to make money fast, not
necessarily for the betterment of its consumers. Finally, Virtue theorists would
notice there is dishonesty, greed, self-interest, disrespect, and lack of
empathy involved in this case. All of which completely go against the cardinal
virtues described in the theory. Quincy Bioscience needs to listen to the FDAs
recommendations, along with discontinuing to mislead the public about its
supposed supplement.
Ethics Case Controversy
Timeline of events
Prevagen was
advertised as a miracle drug that improved memory, learning, word recall, and
executive function. Since the conception of the company, there has been
controversy. For starters, Mark Underwood the founder, stole the idea for the
product from his mother. Her intent was to use a protein found in jellyfish to create
a proven medical treatment that can help people with neurological diseases. Mark
took this idea and started Quincy Bioscience with the premise being to “make a
totally obnoxious amount of money at an early age and spend the rest of my life
spending it” (Wired). For years, the FDA has tried to make cases and find flaws
in the marketing and production of Prevagen, always ending in Quincy Bioscience
finding another loophole and avoiding disciplinary action. To begin, Quincy
Bioscience took advantage of the differences between regulations for drugs and
dietary supplements. Although they are both regulated, they are held to quite
different standards. For drug manufacturers, the FDA requires them to undergo
numerous testing to ensure that before the drugs are introduced, they are safe
and effective. On the other hand, supplements are loosely monitored and have
less regulations. In Underwood’s eyes, it was a no brainer to classify Prevagen
as a supplement because he wanted to make money fast, “we didn't want to wait
another 10 years—the time it could take to conduct clinical trials and request
approval as a drug” (Wired). For example, for supplements, the companies are the
ones responsibility of ensuring their products are safe and effective. This
rule even applies if there is a new supplement introduced to the market, in
many cases these companies do not have to notify the FDA and are presumed safe
until proven otherwise. The exception to this rule is, if there is a supplement
that contains a new dietary ingredient that is not in the current food supply. In
this case, they must provide the FDA with evidence that the substance is safe
for people to consume at least 75 days before the company introduces the
product to consumers. This was an issue for Prevagen at the beginning because
their main ingredient, a protein from jellyfish called apoaequorin, has never
been a part of the current food supply. Although they needed to submit the
documents for this “new dietary supplement” with 75 days’ notice, Underwood
signed the forms a day before his company started selling Prevagen. Quincy
Bioscience began sales in 2007, in 2011 the FDA began doing inspections to
observe the procedures and manufacturing process that Underwood used to create
and produce his supplement. During their inspections, the agents found many
violations in Quincy Bioscience’s manufacturing process, quality control
testing, which is used to safeguard the consumers from unsafe products, and the
companies handling of customer complaints. While conducting their check up at
Quincy Bioscience headquarters in Madison, Wisconsin, the FDA found records of
“more than 1,000 adverse events and product complaints that had been reported
to the company since May 2008. Only two adverse events had been relayed to the
FDA by Quincy. An inspection report documents significant potential violations,
or “observations,” investigators listed 18 cases that Quincy had decided not to
classify as serious and did not share with the FDA. They included five reports
of seizures, three of strokes or mini-strokes, and four of vertigo, dizziness,
or falling that merited medical attention” (Wired). The FDA then realized that
Underwood was manufacturing apoaequorin synthetically and not naturally as they
stated earlier. They wrote Quincy a letter explaining that after review, the
manufacturing of apoaequorin is considered not safe. The Federal Trade
Commission (FTC) also question the claim made by Underwood that Prevagen can
pass through the gastrointestinal system and cross the blood-brain barrier. If
a company claims that a supplement can improve a part of human health through a
process, while being taken orally, the company must prove and support that
claim with evidence. This evidence was never brough forth, further discrediting
the product and leading to more lawsuits. Studies have showed that these claims
made by Underwood are false and misleading, “the product cannot work as
advertised because its only purported active ingredient, apoaequorin (a
protein), is completely destroyed by the digestive system and transformed into
common amino acids no different than those derived from other common food
products” (Justice). In contradiction, Quincy Bioscience relies on one study
done, the Madison Memory Study. In this experiment, Quincy workers took
individuals, gave half of them a placebo pill and the other half a Prevagen
pill, they then had them do tasks and accessed how well they did, continuing
this process for 90 days, recording results after 30, 60, and 90 days. They
concluded that the individuals taking Prevagen has increased cognitive
function, along with other mental benefits. This study is scrutinized because it
did not show statistical improvement when observing the population as a whole,
the study was sponsored by Quincy and authored by company employees, which
leads to implicit bias. “As “proof” of power, a bar graph shows a rise from 5%
to 10% to 20% over 90 days in “recall tasks.” But there is no way to know what
these numbers refer to, how many people were studied, or other important
details. And no information is provided about effects on memory after 90 days.
The fine print under the graph says that the supplement “improved recall tasks
in subjects” without explaining what this means” (Harvard). This study was used
in all their advertisements and sales calls to mislead people into believing
this supplement is effective. A Quincy Bioscience sales team member, Jovan
Chavez, said he capitalized on the Madison Memory Study because it allegedly
showed improvements in memory within 90 days. Using this information to his
advantage, he encouraged customers to buy a three-month supply because
purchasing more bottles decreased the shipping cost, while giving you the
supply of Prevagen you need. Along with this, he promoted a more expensive
extra strength variation, that will help customers faster. Eventually, this
direct sales team was discontinued because customers would call and tell the
employees about adverse side effects they experienced, that would then need to
be documented. Quincy laid off 13 percent of its staff and “a year and a half
later, in November 2016, FDA inspectors observed a “noticeable decrease” in the
number of adverse event reports Quincy received after they stopped the calls”
(Wired) leaving them with over 4,000 reports of health complications expressed
by their customers.
With all these
issues cited in this case, lawsuits have become a powerful tool to combat and
regulate companies like Quincy Bioscience. Prevagen has been specifically
targeted in multiple proceedings, mainly surrounding their false advertising
claims. While the FTC’s false advertising case against Quincy Bioscience is
still ongoing, other settlements are flawed and keep the power in Quincy’s
hands rather than the affected customers. This is due to customers not making any
substantial compensation in these cases, and the ratio of awards to legal fees
being opposite to how they should be. Ultimately, resulting in little to no
individuals making a claim against the makers of Prevagen.
Stakeholders
Quincy Bioscience
relies on their relationship with its stakeholders to ensure they stay in
business and continue making profit. The company will need to make reparations
with its consumers after misleading and manipulating them into buying an unsafe
and unregulated product. They would then have to mend the broken trust with
other stakeholders, such as federal agencies in charge of regulating the
industry. Quincy betrayed their trust by exploiting loopholes internally and
not following regulations, even when instructed to. This relationship with
these stakeholders will need to be repaired, especially if Quincy Bioscience
wants to remain in the industry and get approval for future business actions.
Individualism
From an
individualist perspective, the production and sale of Prevagen would be
ethical. This is due to Milton Freedman theory that management was responsible
for maximizing business profits and any action taken without considering profit
is stealing from the owners of the company (Salazar 17), but to always do so
within the law. Freedman would look at what Underwood did with Prevagen and see
the loopholes that he took to ensure profit and approve of the steps taken. If
Underwood classified Prevagen as a drug, it would have taken years of research
and experiments just to not be released due to it not being effective. Instead,
he knew the loophole around the FDA and classified Prevagen as a dietary
supplement, ensuring a quick and profitable route with this new product. This tactic
seemed to work because “from 2007 through the middle of 2015, sales of Prevagen
totaled about $165 million and the company claims Prevagen is now a
“best-selling branded memory supplement in chain drug stores across the United
States”’ (Elemental). Taking this route for Prevagen is attractive for an
individualist because the safety of the product and compliance needed are very
loose in this industry, furthermore, leading to people taking advantage of
areas that the FDA falls short in. Quincy profited drastically by how “the
marketers of Prevagen preyed on the fears of older consumers experiencing
age-related memory loss” (elemental), it is not illegal to instill fear in
consumers in order to sell a product, therefore, being ethical in an
individualistic analysis. Also, by Quincy ending outbound sales calls, they
were able to minimize their customer complaints and sell more Prevagen without
having to document cases of adverse effects. This is ethical within
individualism because it does not taint the companies records, it has less jobs
since the direct sales department closed, and does not violate any laws.
Eventually leading to increased profit in multiple areas. Although, with new
changes to the FDA, including requirements for supplements to have experimental
evidence and not mislead their customers, Quincy Bioscience will need to change
their strategy to ensure they stay within the law.
Utilitarianism
On the other hand,
a Utilitarian would analyze this case as unethical because of Quincy’s
misleading advertising and lack of concern for the health and safety of their
customers. The theory of utilitarianism states that “we can determine the
ethical significance of any action by looking to the consequences of that act”
(DesJardins 29). Using this as a basis of what is ethical, one would see that
the actions of Underwood, who stole his mother’s idea to quickly sell a new
product, without ensuring its safety and doing the proper experimentation just
to make money, are all unethical actions.
For this to be
ethical through the lens of a Utilitarian, Underwood would have classified Prevagen
as a pharmaceutical drug, gone through the proper testing and regulations to
ensure safety and effectiveness of the product. He then would have to not
mislead his customers on the effects of the drug and report to the FDA the
actual adverse effects that have been reported to the company. If he followed
the regulations without exploiting, did not deceive his customers into
purchasing a product that was not scientifically supported, and used his
customers as an ends and not simply a mere means, then the business would
“maximize happiness in the long run for all conscious beings that are affected
by the business action” (Salazar 17). One of the fundamental regulations for
Utilitarianism is to maximize pleasure and minimize pain with the focus being
on the stakeholders. In this case, Underwood has more self-interest than the
interest of the stakeholders. As seen from the business actions he took, it was
all aimed at making profit and not aimed at creating a proven medical
treatment. This directly goes against the ideals of a Utilitarian because they will
“avoid short-sighted thinking that often boosts profits momentarily but leads
to a quick demise” (Salazar 20), and that is the opposite of what Underwood
did. Furthermore, being ethical from a utilitarian point of view is more
important that just being just that. Being deemed unethical leads to more
financial loss due to lawsuits from customers and agencies that report adverse
effects, misleading advertising, and improper manufacturing procedures.
Kantianism
When analyzing
this case as a Kantian theorist, the main deciding factor of whether the act
was ethical or not depends on the will of the person behind the action.
“Kantianism does not make decisions based on consequences” (Salazar 21), which
is the major difference between that and utilitarian decision making. This can
be applied in this situation because Underwood’s decision for Prevagen to be
classified as a supplement rather than a pharmaceutical drug was expressing bad
will. His reasoning was to make more money as fast as possible, instead of
ensuring the safety and effectiveness of the product before introducing it. Along
with that, another main concept to consider is that “Kant tells us that we
should act only according to those maxims that could be universally accepted
and acted on” (DesJardins 38). With that being said, the question would arise whether
a universal law could be made to absolve supplement companies from providing
evidence of their products safety and effectiveness and advertise dishonestly.
This law cannot be made universal because if everyone was allowed to release a
supplement without having to prove its effectiveness and is safe and can market
it however they want, then that will cause a major health and safety risk for
consumers. It would also not hold those companies legally liable if this kind
of laxity were permitted. Furthermore, when creating universal laws one must
consider that, “truth telling could, but lying could not, be made a universal
law” (Salazar 38) and since Quincy Bioscience was accused of false and
misleading advertising, they cannot say their actions are universally accepted.
When Quincy
received warnings from the FDA, they would either deny them or make small
changes that did not solve the issue at hand. When analyzing this using
Kantianism, one would see that the company only made changes when they were
demanded to, and their intent was to deter the FDA. Underwood is being
unethical and practicing bad will because the reasoning behind making these
changes should be for the betterment of his customers, not for his own
self-interest.
Virtue Theory
From a Virtue
Theorist perspective, a person’s character and how their actions reflect who
they are as a person is much more important than the outcome. Virtue theory is
based on 4 Cardinal Virtues including, prudence, courage, temperance/self-control,
and justice/fairness. Virtue Theorists use these to analyze if people are
ethical by seeing if they “act so as to embody a variety of virtuous or good
character traits and so as to avoid vicious or bad character traits” (Salazar
22). When looking through this lens, Underwood’s decisions display a poor
character that a Virtue Theorist would see as being unethical.
Quincy Bioscience
has infringed on numerous virtues that are crucial to being deemed ethical. For
example, through misleading and false advertising, Quincy has not expressed the
virtues of justice/fairness, which also include honesty. With the FDA citing
issues with the company’s manufacturing processes, complaint handling, and the
quality control testing, along with the FTC’s complaints on false, deceptive
advertising, nothing aligns with the virtues of justice/fairness. The lack of
compliance to regulations and feedback from the FDA has led Quincy to lie to
agencies and their customers and ultimately be regarded as unethical. When
analyzing virtue theory, it is good to use the analogy of a table, the legs are
each virtue that someone must have to be ethical. If one of the legs are
missing (justice/fairness), and someone does not have that virtue, then the
table will collapse, and the person is unethical.
Justified Ethics Evaluation
In my opinion, I
believe that Quincy Bioscience’s actions were unethical in every sense. Even
the foundation and creation of the company was based on an unethical action,
taking the idea from his mother, and changing it from the course she hoped it
would have gone. It has then followed that trend of unethical behavior at
almost every decision made. Whether it be from classifying Prevagen as a
supplement and not a pharmaceutical drug, to not listening to agencies
regulations, and false advertising, there are multiple aspects of this company
that are unprofessional and express negligence. Underwood’s main goal of profit
is ethical through the lens of an Individualist but analyzing it using any of
the other ethical theories, one would evaluate that Underwood and Quincy
Bioscience is unethical.
Even when
customers started to complain about adverse effects and the FDA questioned the
safety and processes within the company, Quincy tried to sweep everything under
the rug. They would either deny or not report adverse effects that were
reported to them and they did not listen to the FDA’s feedback and recommendations
for reform. This negligence led to more people experiencing negative side
effects that were detrimental to their health, all while not being held
accountable for it. Even when they were given opportunities to change for the
better, they continued down the unethical road by persisting to misinform, take
advantage of, and manipulate the public, along with the FDA. Overall, Quincy
Bioscience acted on its own self-interests and used unethical motivations, that
drove every decision away from ethical thinking.
Company Action Plan
Quincy Bioscience
has numerous issues that need to be resolved to continue making profit and
regain the trust of their customers and stakeholders. The company classified
Prevagen as a supplement instead of a pharmaceutical drug to make quick profits
and bypass important regulations. This would be the first issue that needs to
be resolved. The company should reclassify Prevagen as a pharmaceutical drug
and put it through rigorous tests to ensure its safety and effectiveness.
Although this will take a long time and they might encounter issues along the
way, it will prove to their stakeholders that they are serious about reform and
will act ethically. Underwood did not want to take this route because he wanted
quick profits, but this way of thinking is unethical and short term. This is
true because rushing and taking short cuts leads more flaws in the products and
eventually a decrease in profits, along with lawsuits in the future. Classifying
Prevagen as a drug is more of an investment, it will take longer to get profits
but the product is trusted and proven to work, so in the long run the company
will make more money through credibility and proven facts.
Another issue that
Quincy needs to solve is their relationship with the agencies like the FDA.
Through the lifespan of the company, they continuously took advantage of
loopholes and did not listen to warnings given by these agencies. Multiple
times the FDA has requested to come do inspections, during them, they cited
changes that need to be made. In these instances, the agency was met with
opposition and a complete lack of self-responsibility, either being ignored by
the company or denying the violations that were reported. If Quincy listened to
the FDA, they would have a smoother manufacturing process, they would not have
to worry about breaking any violations, and consequently make more money by
having the support of the FDA. Underwood should apologize to the agency and
promise to be compliant with past and future issues.
Quincy Bioscience
has also received backlash due to their poor relationship with their customers.
Agencies are calling for lawsuits for the misleading and false advertising
expressed by the company. They would deceive their customers into ordering more
of their product by relying on a noncredible study, taking advantage of peoples
fears, and exaggerating the effects it has on the body. The Madison Memory
study has been refuted multiple times as not showing any conclusive evidence
into the effectiveness of Prevagen. The sales team would market Prevagen to
older consumers and prey on their fear of age-related memory loss. Quincy also
claimed that Prevagen improves memory by being able to cross the blood-brain. This
claim is false because the main protein that is supposed to improve memory,
gets broken down into amino acids during digestion, before reaching the brain.
With all their claims “Quincy Bioscience failed to show that Prevagen works
better than a placebo in any measure of cognitive function” (NBC). To resolve
these issues and create a better relationship with customers, Quincy must first
apologize and take responsibility for their deception, then they must pay
reparations to those negatively impacted by their use of Prevagen. Once those
steps are done Quincy should conduct a credible study, their marketers should
not take advantages of people fear, and only make claims that are supported by
multiple credible findings. This will take time and money, but in the long run,
they will have a better relationship with customers and be trusted again.
Aside from issues
within the company, one of the biggest issues in this case is the agencies lack
of resources to combat companies that exploit regulations. The lack of funding
to adequately police this industry is a large part of the problem and creates
situations where agencies are not prepared to take regulatory action, instead
they must resort to citing voluntary action to a company. This leads to
companies taking advantage and not being held accountable to following the
rules. With the FDA recently announcing plans to modernize its regulation of
supplements, many companies will be forced to obey new rules to ensure the
safety and validity of every aspect in the industry.
Quincy Bioscience
needs to change their mission statement from being about making money any way
possible, to making sure people see their growth and that they strive to be
more ethical. My recommendation would be “Quincy Bioscience is a biotechnology
company based in Madison, Wisconsin, that devotes new discoveries, developments
and commercialization of novel technologies to support cognitive function while
emphasizing factual evidence, trust, and transparency”. This mission statement
stays true to the original vision while adding key elements that they were
deficient in historically.
The core values
that are expressed in that mission statement, if implemented, resolve the
issues that the company faces, along with confirming their ethical status when
analyzing the company using all the ethical theories.
Values:
·
Factual Evidence – Making sure every claim
made is factual is crucial for every company. This was a shortcoming with
Quincy Bioscience, so if they stress that all their statements are supported by
evidence, the issue will be resolved.
·
Trust – Loyalty is vital when it comes to
its stakeholders. Underwood lost the trust of these individuals by lying and
deceiving. If they can regain this trust, then their customers will be loyal
and business partners will be proud to be associated with them.
·
Transparency – Being transparent and
honest with a company’s stakeholders is of the utmost importance. This was a
major issue with Quincy Bioscience not being transparent with customers and the
FDA on facts, figures, and reports. If they emphasize honesty, then they will
be more ethical and resolve many issues.
To ensure ethical
productivity and monitoring of ethics Quincy Bioscience can become more
transparent with agencies and customers. This transparency will hold them
accountable for their actions and keep their record clean. They can also
implement ethical trainings with advocacy groups that can speak up if they see
anything that is unethical. These groups can either be apart of the company or
apart of an independent organization that solely monitors the ethical state of
the company. They can promote employees that give ideas on how to be more
ethical, along with firing individuals that were the leading cause of claims
against the company for unethical behavior. Quincy Bioscience needs a
completely new marketing strategy that showcases their reforms they have done
and how they shed away their wrong, unethical past.
My plan will take
time and be expensive, but it is worth the investment if the company wants to
continue profiting and be ethical. If Quincy Bioscience does not change, then
they will face financial ruin through lawsuits and violations of regulations.
Since Underwood tried to take shortcuts in the beginning stages of this
company, he is now facing the consequences of these unethical actions. If
Quincy Bioscience implements these changes, they will profit from gaining back
the trust of their stakeholders, become a reputable company that people can
rely on, and ensures good ethics through maintaining their core values.
Conclusion
The supplement industry is very underregulated with a lot of opportunities for companies to take advantage for financial gain. This is exactly what Mark Underwood and Quincy Bioscience did with the memory loss “supplement” Prevagen. They took advantage of loopholes, preyed on the fear of their customers through false and misleading advertising, to sell them a drug that is not proven to be effective or safe. The only way they can comeback from this is to follow the correct regulations that are set in place by the FDA and have their main goal be to create a proven medical treatment. The product needs to be tested in multiple, reputable, studies, factually advertised, and held accountable in every facet of production and reports. Even though there are differences between the ethical theories, there are commonalities amongst them that, when used correctly, can ensure a company is acting ethical. Hopefully, Quincy Bioscience learns from their mistakes and are better able to effectively improve the health of the public in the future.
Ethan Valdes
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