Prevagen: 'Brain Boosting' supplement under fire by FDA for safety (2020)

 

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.

Madison Memory Study falsely advertised effects of 

Prevagen that are not scientifically proven.

 

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

 

References

Carroll, Linda. “'Brain-Boosting' Supplements May Contain Unapproved Drugs, Study Says.” NBCNews, NBCUniversal News Group, 24 Sept. 2020, www.nbcnews.com/health/health-news/brain-boosting-supplements-may-contain-unapproved-drugs-study-says-n1240880.

DesJardins, Joseph. An Introduction to Business Ethics. New York City: The McGraw-Hill Companies Inc, 2014.

Eisner, Chiara. “Americans Took Prevagen for Years-as the FDA Questioned Its Safety.” Wired, Conde Nast, 21 Oct. 2020, www.wired.com/story/prevagen-made-millions-fda-questioned-safety/.

Janet, Howard A, et al. “Prevagen under FDA Investigation.” JJS Janet Janet & Suggs, LLC Attorneys at Law, Hotjar, 2020, www.jjsjustice.com/prevagen-fda-investigation/.

(Image) Katz, Mitchell  J, et al. “FTC, New York State Charge the Marketers of Prevagen With Making Deceptive Memory, Cognitive Improvement Claims.” Federal Trade Commission, 9 Jan. 2017, www.ftc.gov/news-events/press-releases/2017/01/ftc-new-york-state-charge-marketers-prevagen-making-deceptive.

Robert H. Shmerling, MD. “FDA Curbs Unfounded Memory Supplement Claims.” Harvard Health Blog, Harvard Health Publishing, 29 Sept. 2020, www.health.harvard.edu/blog/fda-curbs-unfounded-memory-supplement-claims-2019053116772.

Salazar, Heather. The Business Ethics Case Manual. n.d.

(Image) “Prevagen Extra Strength Capsules.” Walgreens, 2020, www.walgreens.com/store/c/prevagen-extra-strength-capsules/ID=300402930-product.

Zaleski, Andrew. “The Predatory Scam of Memory Supplements.” Elemental, Medium, 14 Oct. 2020, elemental.medium.com/the-predatory-scam-of-memory-supplements-c49c8a17d14b.

Purdue Pharma Pleads Guilty to Federal Criminal Charges Regarding OxyContin (2020)

    For the past few decades, The United States of America has been plagued with an opioid epidemic. Purdue Pharma, the makers of OxyContin, have been known to be greatly contributing to this epidemic, if not causing it entirely. Recently, the company has been charged with several criminal charges, as well as made to pay billions of dollars in fines. As a part of the settlement that was reached, the Sackler family, who has owned the company since the 1950’s, will lose ownership of Purdue Pharma, as it is turned into a public benefit company. 

     All ethical theories would find several issues with the actions of Purdue Pharma. From an individualistic perspective, their actions were those of a typical business trying to maximize profit, however several violations of the law make their actions impermissible.  A utilitarian would also see several issues with this situation, as the biggest concern of utilitarianism is maximizing happiness for all. As will be outlined in this paper, not a single individual in this situation ended up with what one would consider to be happiness. From a Kantian perspective, several actions of Purdue Pharma are considered impermissible, particularly using people as a means to some end goal, as well as practicing manipulation of consumers. Finally, virtue theorist would find concern in the fact that almost all no virtuous traits were carried out by Purdue Pharma, but rather they practiced vices such as greed, dishonestly, and manipulation. 

    Although Purdue Pharma made several unethical mistakes in the marketing and distribution of OxyContin, there are things that can and should be done to fix this problem. By taking responsibility and showing that they have a desire to help those that they harmed, Purdue Pharma has the potential to improve their public image and regain the trust of Americans. 

Ethics Case Controversy 

 

Purdue Pharma's OxyContin, the meditation that has 
caused millions of deaths and led to the downfall
of the company. 

    Throughout the past couple of decades, the opioid crisis has become characteristic of the United States of America, and Purdue Pharma is being held responsible for creating it. The company has had to admit to “enabling the supply of drugs without legitimate medical purpose” (BBC), meaning that their only concern was selling their medication with no regard to whether it was done properly and safely or not. Recently, Purdue Pharma has been undergoing a federal investigation on the basis of lack of care involved in distributing OxyContin.  This has led to an $8.3 billion settlement to be reached. The settlement emphasizes that “for more than two decades, there has been a widespread problem of overprescribing, diverting, and abusing pain medication in America, while drug manufactures such as Purdue profited from this issue and failed to take responsibility or action” (Rowland). As part of this settlement, the Sackler Family, which has owned Purdue Pharma since the 1950’s, will not only lose ownership of their company, but will admit to “three felony counts for defrauding the federal government by misleading regulators about its efforts to restrict overprescribing of the drug and to violating anti-kickback laws by paying doctors to write more OxyContin prescriptions” (Williams).  A prime example of their wrongdoing was in 2012, when “members of the Sackler family demanded that company executives come up with a plan to generate greater revenue in response to slumping sales. A new marketing plan, called ‘Evolve to Excellence’ was created. This plan involved more intensified marketing of OxyContin to extreme, high-volume prescribers who were already writing ‘25 times as many OxyContin scripts’ as their peers.” (Rowland). While the company agreed to pay huge fines because of this as well as admit criminal liability, the family that owns the company, as well as executives within the company, claim that they "acted ethically and lawfully, and the upcoming release of company documents will prove that fact in detail” (Rowland). 

    This investigation has been ongoing for a substantial amount of time, however a settlement was just now reached due to the presidential election, but some are saying that it was far too rushed, and feel as if Purdue Pharma should have suffered more consequences for their actions. The Justice Department was pushed to settle a large number of outstanding cases involving major corporations, as “Administrations often seek to resolve significant cases as they near the possible end of their time in office, and with Election Day drawing near, the Trump administration has pushed to finalize a number of such matters this month” (Rowland). Massachusetts attorney Maura Healy stated that she believes that the Justice Department has failed, because “justice, in this case, requires exposing the truth and holding the perpetrators accountable, not rushing a settlement to beat an election” (Rowland). 

 

    The substantial amount of money that will be paid in this settlement will be used to redress past wrongdoings, as well as provide new resources for treatment and care of those impacted by OxyContin. Furthermore, Purdue Pharma will be turned into a Public Benefit Company, “meaning it will be governed by a trust that has to balance the trust’s interests against those of the American public and public health” (Balsamo). This comes as a relief to many, as the Sackler family has evidently caused an abundance of problems for the American public, and thus, they will no longer have control of their company. 

Timeline of Events 

 

Stakeholders

    There are countless stakeholders in this situation, including people who currently suffer or have previously suffered from addiction to OxyContin, the family and friends of people facing this addiction, the Sackler family, and the American population in general. People who have faced addiction to OxyContin largely have Purdue Pharma to blame, because if the medication was marketed and distributed properly, it’s likely that they would not have had a problem with it at all. Brooke Feldman, who is in recovery from opioid use disorder, stated that she “is glad to see Purdue admit wrongdoing. She said the company has acted for years as a ‘drug cartel’” (Balsamo). Many people who have faced addiction have lost a lot from this situation, including their jobs, relationships with family and friends, and some even losing their lives, which makes them one of the primary stakeholders in this situation. 

Protesters stage a "die-in" inside Harvard's
Arthur M. Sackler Museum to protest the Sackler's
involvement in the opioid crisis.

    Furthermore, families who are impacted by a member suffering abuse of the drug are also stakeholders, as many have lost someone they love due to the company’s wrongdoings. Ed Bisch, “who lost his 18-year-old son to an overdose nearly 20 years ago, said he wants to see people associated from Purdue prosecuted and was glad that the Sackler family wasn’t granted immunity” (Balsamo). Along with millions of others, Bisch blames the company and the family for the millions of deaths that have occurred, and has noted that “If it was sold for severe pain only from the beginning, none of this would have happened…but they got greedy” (Balsamo). 

    The Sackler family and other top executives are stakeholders because not only were they the decision makers in this case, but they also lost billions of dollars, as well as their company. Since they were the ones who chose to market their product aggressively, bribe medical professionals, and not take precautions to ensure the use of their product was safe and controlled, they ultimately made the decisions that made their company suffer. Because of that, and because they are also at a loss, they are considered stakeholders in this situation as well.

    Lastly, the American public are stakeholders in this situation as well. On top of having to be careful not to abuse OxyContin if they get prescribed it, Americans also have to watch people that they know and care about suffer from addiction. Many people, even if they are in severe pain, do not even want to get OxyContin prescribed to them because of how addictive it is. Since many have to live in fear, as well as watch many Americans suffer from OxyContin addiction, the general American public can be considered stakeholders in this situation as well. 

 

Individualism

    From an Individualistic perspective, there is wrongdoing involved with Purdue Pharma’s actions in the marketing and lack of responsibility in distributing OxyContin. Individualism, the theory created by Milton Friedman, emphasizes that “business actions should maximize profits for the owners of a business, but do so within the law” (Salazar 17). The aggressive marketing of OxyContin would not be seen as unethical from an Individualistic point of view, but rather beneficial to the company. The problem, however, is that Purdue Pharma used unlawful tactics in order to market their product. Purdue admitted to not only “violating federal anti-kickback laws by paying doctors to induce them to write more prescriptions, but also that it “impeded the Drug Enforcement Administration by falsely representing that it had maintained an effective program to avoid drug diversion and by reporting misleading information to the agency to boost the company’s manufacturing quotas” (Balsamo). Because they have violated several laws in order to make profit, this is not permissible under individualism. 

 

    Aside from the illegal aspect, the goal of their marketing was simply to maximize profit, which is the overall goal of Individualism. Since this theory is more so about the business and business owners rather than the consumers, there is nothing wrong with causing millions of addictions and deaths, according to Individualism. As long as the business is actively trying to maximize their profit, and doing so within the law, it is seen as permissible. 

 

    Although “Friedman held that it is the aim and the responsibility of businesses to maximize their

profits” (Salazar 18), Purdue Pharma was still in the wrong from an Individualistic point of view. Although consumers were undoubtedly harmed, that does not matter in and Individualistic sense, unless the law is broken. Since the marketing was not done within the law, however, this is not permissible under Individualism. 

Utilitarianism

    

    Utilitarianism emphasizes ‘maximizing the overall good’ or, in a slightly different version, of producing ‘the greatest good for the greatest number’. Acts that accomplish this aim are good; those that do not are bad” (Desjardins 29). This essentially means that the main goal is to maximize the happiness of everybody involved. 

    When Purdue Pharma was first beginning to sell OxyContin, their actions may have been seen as permissible under Utilitarianism. The Sackler family, as well as top executives in the company, were profiting off of selling this drug, which evidently causes happiness for them. Doctors were under the impression that the timed-release formula was meant to decrease the likelihood of addiction, so having a drug that reduced pain, while also having non-addictive properties, was seen as a great thing in the medical industry. Consumers, who had been dealing with severe pain before, were given a medication that worked well for reducing pain, which in turn made them happy. 

 

    Later on, however, almost everyone was hurt by this situation, meaning that it was shown to be unethical by Utilitarians. Consumers began facing addiction or even death due to OxyContin, meaning that family members were losing loved ones because of this drug. People who suffered from addiction were clearly not happy, and the risk of losing one’s life did not cause happiness either. Purdue Pharma was faced with incredibly large fines, as well as having to give up their business, meaning that he happiness from making profit did not last, and they ended up becoming unhappy as well. Since “business actions should aim to maximize the happiness in the long run for all conscious beings that are affected by the business action” (Salazar 17), and nobody remained happy in the long run, it becomes evident that the actions of Purdue Pharma were not permissible under Utilitarianism. Since almost everyone suffered in the long run and nobody came out of this situation with happiness, it can be seen that these actions are not beneficial to any of the stakeholders. This emphasizes that ultimately, the actions of Purdue Pharma were unethical by a Utilitarian point of view. 

 

Kantianism

    According the The Case Manual, the ethical rule of Kantianism is to “always act in ways that respect and honor individuals and their choices. Don’t lie, cheat, manipulate or harm others to get your way. Rather, use informed and rational consent from all parties” (Salazar 17). Furthermore, according to Kant, “…ethics requires us to treat all people as ends and never only as means.” (Desjardins 38).  Purdue Pharma undoubtedly violated this, as they were using consumers as a means to the end goal of profit. The company did not care that people were becoming addicted to this medication at astounding rates, leading to millions of deaths across America, but rather they used this to their advantage, enabling them to sell more drugs and in turn, make more profit. 

    Although this situation is seen as ethically wrong in both Utilitarianism and Kantianism, it is wrong for different reasons. One of the key differences in the ethical theories is that “Utilitarianism is concerned only with consequences of an action and Kantianism does not make decisions based on consequences, but rather on what Kant calls the ‘Good Will.’” (Salazar 21). This essentially means that just because an action can produce good results, the action cannot be done based on only the outcome. Having Good Will, in this case, means that “…people

have good intentions and use good reasoning to come to conclusions that will 

make their good intentions effective” (Salazar 21). In the case of Purdue Pharma, it becomes clear that their intentions were only good for themselves, and not the consumers. They knowingly harmed millions of people in order to increase revenue, which ultimately benefitted only the Sackler family and top executives at the company. 

 

    One of the most concerning violations of Kantianism is one of the most important aspects of the theory, which emphasizes that the “fundamental ethical duty is to treat people with respect, to treat them as equally capable of living an autonomous life” (Desjardins 38). By continuing to aggressively market a drug that was known to be extremely addictive, Purdue Pharma was taking away people’s autonomy. Causing people to become dependent on a drug is one of the most clear-cut ways to manipulate people, as well as take away their autonomy. Once consumers become addicted, they keep needing more, which means that Purdue Pharma was making more and more profit off of people’s suffering. Because of this, it is evident that this case is extremely impermissible under Kantianism. 

 

Virtue Theory

    Similarly to Individualism, Utilitarianism, and Kantianism, the actions of Purdue Pharma would be seen as unethical by a virtue theorist. Virtue Theory, rather than focusing on individual actions, focuses on the character of individuals. The main objective of this theory is to “act so as to embody a variety of virtuous or good character traits and so as to avoid vicious or bad character traits” (Salazar 17), and it is evident that Purdue Pharma did not do that. 

 

    According to The Case Manual, “A few vices that have been severely detrimental to otherwise savvy and innovative business people are greed, dishonesty, and selfishness” (Salazar 23), and Purdue Pharma has demonstrated all of these. The company showed greed when they went to extreme measures to have their product become more popular. By convincing doctors to prescribe OxyContin more frequently, as well as going so far as to violate the law in order to make more profit, they have shown that they care more about profit than the health and wellbeing of consumers. Furthermore, dishonestly in this situation is rampant. On top of “defrauding the federal government by misleading regulators about its efforts to restrict overprescribing of the drug” (Williams), they have also lied about the dangers of the drug and its addictive properties, putting millions of people at risk. In terms of selfishness, Purdue has put gaining profit above the health of their consumers. They have expressed a selfish need for even more revenue than they already have, and rather than attempting to resolve the problem that they caused, they contributed to it even more. 

 

    Virtue theory values “Character Traits that Promote Wellness or Flourishing of Individuals within a Society.” (Salazar 22), and it is clear that Purdue Pharma does not promote wellness, but rather neglects it in an attempt to maximize profit. Because they marketed their product so aggressively and promoted the over-prescription of the drug, they were not promoting the flourishing of individuals within society, but rather the downfall. Because of all of the vices they have shown, as well as lack of virtuous characteristics, it is evident that a virtue theorist would view the actions committed by Purdue Pharma to be completely unethical. 

Justified Ethics Evaluation 

            In my opinion, Purdue Pharma’s actions were completely unethical. Not only did they harm millions and millions of people for the sole purpose of making profit, but they also did nothing to stop the epidemic that they created, but rather contributed to it even more. They were well aware that people had become extremely addicted to OxyContin, however, they continued to aggressively market the product, as well as bribe doctors to prescribe it abundantly. By implementing things such as “intensified marketing of OxyContin to extreme, high-volume prescribers who were already writing ’25 times as many OxyContin scripts’ as their peers.” (Rowland), Purdue Pharma put the health and safety of consumers at risk for the sole purpose of increased profit. Furthermore, they broke the law to do these things, by “defrauding the federal government by misleading regulators about its efforts to restrict overprescribing of the drug and to violating anti-kickback laws by paying doctors to write more OxyContin prescriptions” (Williams). Because of this, it is clear that Purdue Pharma made several ethical mistakes, which shows an abundance of negligence within the company. Not putting consumers first, but rather putting their lives at risk, is not ethical, and therefore Purdue Pharma acted completely unethical in this situation. 

 

Company Action Plan 

    It is evident that Purdue Pharma’s actions harmed millions of Americans. Because of this, there are several steps that must be involved in order to correct their wrongdoing. 

    First and foremost, the family and executives within the company need to accept their wrongdoing and admit to creating and contributing to the opioid epidemic. The family claims that they “acted ethically and lawfully, and the upcoming release of company documents will prove that fact in detail” (Rowland). This is evidently not true, and one of the first priorities when it comes to getting forgiveness from the general public is to admit that they did something wrong. Acknowledging their mistakes is the least that they can begin with doing. By doing this, they will show the American public, as well as those who have faced consequences from OxyContin, that they acknowledge their mistake and know that it was wrong of them.  

     As of now, Purdue is set to transform into a Public Benefit Company. One of the main purposes of this is “to ensure funding is devoted to advanced treatment programs” (Rowland), but also to ensure that the Sackler family will lose control of their company. Because of this, it will be impossible for the Sackler family to change the way they market and distribute OxyContin, since they will no longer have any part in it.

    One of the most important and potentially helpful things that the Sackler family can do to is donate money to families and communities that have been heavily impacted by the opioid crisis.  This is already a part of the settlement, since members of the Sackler family have already expressed a desire to “direct substantial funding to communities in need, rather than to years of legal proceedings…members of the Sackler family have expressed ‘deep compassion for people who suffer from opioid addiction and abuse and hope the proposal will be implemented as swiftly as possible to help address their critical needs’”(Williams). Despite the fact that this is already outlined in the settlement, it could be very beneficial for the Sackler family to donate some of their own personal money. This would not only improve the company’s public image, but it would show Americans that the family truly does care about how many people they have harmed, and are willing to give up part of the profit that they fought so hard for in order to help. 

    If the company wants to be able to remain profitable or be able to increase their profits, they would need to improve their public image and make sure that they are staying within the law. The Sackler family, however, will no longer have the ability to profit from the sale of OxyContin, since they no longer own the company. The Public Benefit company, however, must ensure that they are doing better than the Sackler’s in terms of marketing, distribution, and not violating the trust of the federal government and the American people. 

     Some of the values that need to be prioritized are trust, compassion, customer well-being, and honesty. Trust needs to be prioritized because it is one of the most important aspects of running a business. After the controversy, many Americans do not trust Purdue Pharma, and therefore the new company that will remain manufacturing OxyContin will need to regain this trust. The new company, as well as the Sackler family, needs to show compassion.  It was one of the main things that has been lacking for decades, and ensuring that businesses care about the people that they are supplying to is important, and it helps build trust. After all of the company has done, they need to show compassion and prove to Americans that they have learned from their mistakes. Customer well-being is the most important of all of these values. Because they are pharmaceutical company, that should be their first priority, however it wasn’t while the Sackler family owned it. The new Public Benefit Company, as well as the Sackler family, even after losing their company, need to show that they do care about the well-being of their customers. If that does not happen, then the company will not be able to flourish, and the Sackler family will remain in bad view from the public. Lastly, honesty is important in any business, but pharmaceutical companies especially. Pharmaceuticals have the power to kill people, create addictions, and cause many adverse effects. Companies need to be honest with not only their customers, but the government as well. It needs to be apparent to customers that the company has the well-being of customers as the first priority, and will not practice dishonesty to deceive customers for the purpose of profit. 

 

     If the Sackler family follows these steps of publicly apologizing, donating money to families and communities that were impacted from OxyContin, and keeping their values aligned, the company has a chance of greatly improving their public image, and potentially gaining the trust of Americans back again. Although it will be hard for them to be completely forgiven, taking steps towards this goal is important. If the family and the company do nothing, then they will be seen as even worse than they already are. 

     It is apparent that Purdue Pharma has made mistakes in the marketing and distribution of their product, OxyContin, that are considered to be extremely unethical. Not only did the company break several laws and lie to the federal government, but they also knowingly contributed to the opioid epidemic that has been controlling America for decades. Many, if not all, of Purdue Pharma’s actions were done for the sole purpose of increasing profits to extremely high amounts, however, they prioritized this over the lives of consumers. When looking at the situation from an Individualistic approach, almost everything is permissible, except for the fact that they broke the law. The ethical theory essentially states that businesses can do whatever needs to be done in order to maximize profit, as long as it is within the law. Because of that, it is obvious that this is impermissible under Individualism. In the sense of Utilitarianism, it is obvious that not everybody is happy in this situation. Not only are there millions of Americans suffering from addiction to OxyContin, but also family members and members of the community are drastically affected from that as well. Furthermore, the Sackler family ended up losing their company and having to pay billions of fines, so they are evidently not happy either. When preparing an analysis from a Kantian perspective, it becomes apparent that this is also impermissible, Purdue Pharma used customers as a means for increasing profits, and harmed them in the process. Lastly, a virtue theorist would also disagree with these actions. They are not practicing virtues that make businesses and people flourish, but they are instead practicing vices such as greed and dishonestly that harm people. Despite the fact that Purdue Pharma made a huge mistake and harmed the American people, there are steps that they can take to make things right. By taking full responsibility for their actions, as well as showing that they regret what they did by making monetary donations to those who have been affected, Purdue Pharma and the Sackler family has the ability to repair their public image, as well as potentially gain the forgiveness and trust of the American people. 

 

                                                                                                           Julianne Hess

 

 

 

 

 

References

 

Balsamo, Michael, and Geoff Mulvihill. “OxyContin Maker Purdue Pharma to Plead to 3 Criminal Charges.” AP NEWS, Associated Press, 21 Oct. 2020, apnews.com/article/virus-outbreak-business-criminal-investigations-opioids-epidemics-5f0679ffee14577b1696a94b64abc9c2.

DesJardins, Joseph R. An Introduction to Business Ethics. McGraw-Hill/Irwin, 2014. 

Ofgang, Erik. “Purdue Pharma and OxyContin: A Timeline.” Connecticut Magazine, 24 Oct. 2019, www.connecticutmag.com/health-and-science/purdue-pharma-and-oxycontin-a-timeline/article_e140534a-f50f-11e9-96ab-8bb2725250e0.html.

“OxyContin Maker Purdue Pharma to Plead Guilty to 3 Criminal Charges.” CBS News, CBS Interactive, 21 Oct. 2020, www.cbsnews.com/news/oxycontin-maker-purdue-pharma-to-plead-guilty-3-criminal-charges-ap/.

Rowland, Christopher, and Meryl Kornfield. “Purdue Pharma Agrees to Plead Guilty to Federal Criminal Charges in Settlement over Opioid Crisis.” The Washington Post, WP Company, 22 Oct. 2020, www.washingtonpost.com/national-security/2020/10/21/purdue-pharma-charges/.

Salazar, Heather. The Case Manual . 

Sherman, Natalie. “Purdue Pharma to Plead Guilty in $8bn Opioid Settlement.” BBC News, BBC, 21 Oct. 2020, www.bbc.com/news/business-54636002. 

Williams, Pete. “OxyContin Maker Purdue Pharma Pleads Guilty to Federal Criminal Charges.” NBCNews.com, NBCUniversal News Group, 22 Oct. 2020, www.nbcnews.com/news/us-news/oxycontin-drugmaker-purdue-pharma-pleads-guilty-federal-criminal-charges-n1244155.