Violation of Values

7/27/2019 Violation of Values

1/33

The CommitmentTo Business Ethics And The Foundation Is Built Through

OrganizationalCulture, With Ethical Values Reflected In The Workplace.

MANIRATNA DEORI 12020841081ADITI MEHROTRA - 12020841002


2/33

What is Corporate Ethics

Ethics takes on different meanings in differentcultures, making it challenging to truly definebusiness ethics in international markets.

Organizational leaders have a key role inestablishing corporate values and modellingethical behaviour for their workforce,

organization and community. However, a number of actions that are almost

universally considered unethical


3/33

Unacceptable in Every Culture

HR Ethics - unethical workplace behavior

Accounting Ethics - flat-out misrepresentingincome or expense figures on financial

statements Community Impacts affecting external stake

holders such as noise, air & water pollution

Theft & Fraud - gross exaggerations of clientsfinancial positions, embezzlement


4/33

Company examples


5/33

Oil spill in the offshore about 230 miles fromthe coast of northeast Rio de Janeiro.

155,000 gallons of crude are thought to have

been released in the November 2011 spill.

Chevron pays Brazil oil spill fines totaling$17.3 million.

$8billionpenalty

forNigeriaoil spill


6/33

Paid bribes to doctors in three European countries toprescribe J&J medicines. kickbacks to Iraq to illegally obtain business under formerleader Saddam Hussein. Settlement includes $48.6 million to the SEC in disgorgementand prejudgment interest, a $21.4 million criminal penalty, and

4.8 million ($7.8 million) to the U.K. Serious Fraud Office.


7/33

Accused of committing $11 billionfraud by making adjustments to thecompanys financial statements to

give investors a misleading picture ofthe companys performance.

$6.13 billion to investors whosuffered loses.

$2.58 billion by Citigroup Inc., $2billion by JP Morgan Chase & Co.


8/33

DISNEYLAND HONG KONG

CREATING FANTASY


9/33

MERK & CO.


10/33

Merk & Co.

Asked to pay $950 million in damagesresulting from their selling drug Vioxx. Vioxx was in September 2004 due to side effects

of:

Heart attacks

Other cardiovascular diseases


11/33

Merck agreed to pay

$321.6 million in criminal

$628.4 million in civil

Merck sold the drug for uses yet to be approavedby the FDA.

They marketed Vioxx as a remedy for rheumatoidarthritis without FDAs approaval.

They in 2007 compensated Merck also agreed in2007 Vioxx users who suffered from heart attacks.

Amounting to $4.85 billion.


12/33

In four years (2007-2010), they settled 3,500death claims related to Vioxx.

Average payment for heart attack cases was

$186,800,Average for death cases $374,100.

In 2010, the report identified 58,022 Vioxxclaims.

In a 2004 report revealed that around 160,000heart attacks and strokes were linked to Vioxx.

Out of which 30 to 40 % people died.


13/33

GLAXOSMITHKLINE


14/33

Today, I am pleased to announce that theJustice Department and our law enforcement

partners have reached an historic $3 billionresolution with the pharmaceuticalmanufacturer GlaxoSmithKline, LLC, toresolve multiple investigations into the

companys sales, marketing, and pricingpractices. This act ion cons t i tu tes th e largesthealth care fraud sett lement in United

States histo ry. ~ Deputy Attorney General

James M. Cole (emphasis mine)


15/33

GlaxoSmithKline (GSK) got in trouble forpractices surrounding its own psychiatric

drugsand for a diabetes drug to boot. GSK was found guilty of illegally marketing

antidepressants Paxil and Wellbutrin and

downplaying safety risks of diabetes drugAvandia.


16/33

Cases

Criminal

Civil


17/33

CRIMINAL


18/33

Paxil

An anti depressant drug.

Never received approval for administration on

children and adolescents.

Even then from April 1998 to August 2003,GSK promoted Paxil for treating depression in

patients under age 18.


19/33

Steps taken for illegalpromotion

Doctors incentivised to administer the drug topatients under 18.

Dinner

Lunch Spa programmes

Lavish vacations

Manipulated medical journal article Bribery


20/33

Side effects

Birth Defects

Extreme Withdrawal Symptoms

Increase in Suicidal tendency by

3 times


21/33

OUTCOME

200 suicide case

Also homicide cases


22/33

Wellbutrin

In 2000s, the FDA had approved Wellbutrinonly for use in Major Depressive Disorder.

Yet it was allegedly promoted for:

1. Weight loss,

2. Sexual dysfunction

3. Substance addictions

4. Attention Deficit Hyperactivity Disorder.


23/33

GSK pleaded guilty to misbranding Wellbutrin,

For Paxil and Wellbutrin offenses, GSK asked

to pay a criminal fine of

$757,387,200


24/33

Avandia

From 2001 to 2007 GSK manipulated the datapresented to FDA for approaval.

The reports failed to mention results of two

studeies in relation to cardiovascular safety. Forgot to mention the increased risk of

Congestive heart faliure

Heart Attack


25/33

There were serious ommision in the reportbeing presented to FDA for approal of thedrug.

Similar to what was done in PAXIL. They pleaded guilty and were asked to pay a

criminal fine for its unlawful conduct of:

$242,612,800


26/33

OUT COME

5500 heart attacks resulting in death.

10700 reported cases of its severe sideeffects.


27/33

CIVIL


28/33

Off-label promotion andkickbacks.

Promoting its

Asthma drug Advair for mild asthma patients

Mood-stabilizing drug Lamictal for pain

management

Zofran, approved for post-operative nausea,for treatment of morning sickness in pregnant

women.


29/33

GSK paid to healthcare providers forencouragement to prescribe these drugsand

drugs Latronex, Flovent and Valtrex.

Cost for these $1.043billion


30/33

Misleading facts about Avandiassafety profile

$657 million total of which

Federal share is $508 million

State share $149 million


31/33

False drug price reporting

GSKs underpaying rebates owed under the

Medicaid Drug Rebate Program.

GSK will pay $300 million in all.

$160,972,069 to the federal government,$118,792,931 to the states

$20,235,000 to certain Public Health Service

Gl S ithKli


32/33

GlaxoSmithKline

Mission

Deliver more products of value

Grow a diversified global business

Core Values:

Transparency

Respect for people

Patient-focus

Integrity.


33/33

Values of Merck & Co.

Improving Life

Ethics and Integrity

Innovation

Access to Heath

Diversity and teamwork

Documents

Violation of Values