Merck Pharmaceuticals Code of Conduct

Introduction

Merck group Company is an international pharmaceutical company having its branches worldwide. The company is represented on all continents by many companies. It has many employees who are committed to research and development in both production and sales in order to come up with new drugs and encourage innovation.   The pharmaceutical sector is just one of the three divisions within the company .It comprises of prescription and branded drugs offered by the ethical division. The company makes huge sales annually. In 2005, the company sales came to $5.9 billion. This was an increase of 9.9% in terms of the sales that were made in 2004. The company also deals with the prescription of branded drugs that are used in the treatment of various diseases. These diseases include: cardiovascular diseases, metabolic disorders, and also cancer. The company has been reported to be involved in the production of generic drugs. These drugs are cost effective and hence, they can easily be afforded by many people. In this way, poor people and those people who cannot afford the drugs are able to get an access to their generic counterparts. This work was delegated to the generics division.  Over-the counter products are also offered by the company from the consumer health care division. (Cragg, 2002).The company is the world’s oldest pharmaceutical company. It has been discovered that the company has its beginnings as early as in 1668.   It was first involved in industrial production then it started researching on liquid crystals. It started working on pharmaceutical products in 2003, when it launched Erbitux which was tested to be a cancer drug. The company is mainly geared towards coming up with drugs that cure diseases. This is in the quest of improving health and quality of life. (Bowie, 1983)

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The company has been working to come up with therapies to the diseases that their cures have not been known. By working on new ways of treatment, the company is subsequently improving its position in the market.

The company’s code of conduct

Codes of conduct of an organization or a company, define the ethical standards that are developed by the Organization or Company.  Therefore, the two go together. There has to be a document that describes the responsibilities of the company towards the people that it regularly gets in contact with. For accompany to ensure that the codes of conduct are complied with its employees, it sets up programs to ensure that the employees are made aware of the existing codes of conduct put in place by the company. This is also to carry out audit compliance. It is the process of measuring, evaluating, reporting, and adapting a company’s social impact and ethical behavior in light o fits values and expectations of the people it gets in contact with. This is often difficult for most companies to undertake alone. Therefore a more practical approach is them using existing certifications like ISO 9001 and ISO 14001. The latter is concerned with safety issues while the former dictates the aspects involving the environment. The two issues are the ones that are responsible for continued innovation. There are other certifications which protect Companies from various problems in their day to day operations. Example, there is one that protects suppliers from customers’ unethical behaviors. Labor conditions are also set by some of the certifications. In general, the iso-certifications and codes of conduct improve on the accountability of a company to its stakeholders and employees. (Sternberg, et al.2000). To improve the ethical awareness of the employees in a company, the company has to subject them to some form of training. This will help the employees to know how to assimilate the core values in hard situations.

The Merck pharmaceutical industry is dedicated to coming up with new innovations in the health sector. It has the responsibility to ensure that health care solutions are used to improve peoples’ lives. Merck has a compliance program that is well established which shows that Merck has been committed to laws and regulations governing the United States’ Vaccine marketing and selling activities. The compliance program is just the same as the Pharmaceutical Manufactures compliance program. Even the recommendations in that program, have been adopted by Merck. This program was published by the Office of the inspector general, U.S. department of health and human services. The provision on the code on interaction that is supposed to be adopted by all health care professionals was created by Pharmaceutical research and Manufactures of America. The aim of the Merck’s compliance program is to detect, prevent, and resolve the possible violations of the company’s policy. (Walton, 1992). The company uses resources to ensure that the compliance program is implemented. Merck’s chief ethics and compliance officer is the one who ensures that the Merck’s office of Ethics is well managed. The code of conduct put in place by Merck, is the general ethical principles, values and standards that directs the company in its daily operations. The code of conduct applies to all the employees and any person who gets in to contact with the company on business issues. This dictates how employees are supposed to carry out their daily operations. (Wilson, 2000). There are those employees who wish to put across unethical behaviors or violation of the company’s policies. To these workers, a confidential telephone line has been set for them. The telephone line is operated by some outside firm which forwards the problems to Merck. This protects them from being victimized by their employers. The Ethics office is held responsible for making sure that ethical complaints are well tackled. (Skelly, 1995). It has been a routine for the company to employ people who have a high degree of integrity and ethics. This is because the company’s image is of great importance and the employees determine the image that a company projects. The employees are usually subjected to a drug screening and background investigation before hiring takes place.

The corporate responsibility committee sets up goals of Merck’s corporate responsibility policy. The company is committed to labor standards, the anti-corruption and Environment laws and also the human rights. (Anderson, 1993). The company ensures that its employees are treated with respect and that they work in a good environment. The employees are also assured of a good remuneration package. The company also has a responsibility toward the environment. Its employees are expected to handle pharmaceuticals, chemicals and laboratory products with care. Through this, the employees are assured of a good and safe working environment. The neighboring communities are also protected from environmental contaminants. The company frequently performs an environmental and safety audits to know if the strategies they have put in place is effective. (Rhys J. 2001)

The company tests its products extensively before launching them in the market. This is one of the most important corporate responsibilities that the company has. The employees are trained well to ensure that they release a drug that has been proven not to have any bad effects to the general population. (Zadek, 2001)

The workers are trained to be very transparent in their operations. As a pharmaceutical company, Merck ensures that any drug that is tested and found to have side effects is documented. Raymond V., President, Chairman, and Chief executive officer of Merck and Company, has been quoted saying that a strong ethics program is a key to creating a strong ethical corporate culture. He believes that the leaders in a company should set up an example to the employees in the matters of Ethics. If this is put in to practice, then there is no doubt that the code of conduct implemented will be followed by all the employees in a company. In other words, company’s leaders should advocate for model ethical behavior. (Donaldson, 1989). The Merck’s company has strong code of conduct put in place. The employees are allowed to voice complaints when they feel short-changed by the company. They are given an opportunity to voice out opinions of what they expect from the company and also ask about anything when in doubt. The Company’s culture and tradition helps it have a commitment to the ethics that they have set for themselves. This makes its employees to adhere to the high standards of integrity and ethics the company has set. The managers are trained to behave ethically to ensure that their employees follow suit. (Vergara, et al.1999)

The company has the responsibility of looking in to the community’s welfare. It has proved itself by offering Education to students who are willing to learn. Several schools have been established by the Company. Students who cannot afford to pay school fees have been granted scholarships by the company. This contributes to the high integrity that the company has. (Raynard, et al.2001). The company has well developed strategic communication plans that ensure that all employees know the resources available to them and how to access and utilize these resources. One of the greatest challenges that the company has faced was developing a global set of standards. Due to the rapid globalization, new challenges have been posed on the company’s ethics. The code of conduct of the company is aimed at making the company compete fairly and honestly. Unlike other companies who draft a code of conduct and transports it to another country where their other subsidiaries are, Merck develops a code of conduct for every subsidiary company in other countries. The company does not encourage buying and selling of its securities based on non-public material information. This is because this is an ethical issue and that it cannot be applied to everyone and everywhere. (Winston, 2002)

Merck Company is an equal employer. It believes in equal opportunity for women irrespective of where they work. Hence, the company offers protection to the women employee against unethical behavior by customers. Therefore, if a woman employee is sent to carry out business in a country that does not respect women, the employee is taught about ways of handling such attitudes. The company does this without compromising its commitment to gender equality. Therefore, the company has an ethical responsibility and commitment to every female employee it has. (Singer, 2002)

Proper labeling and prescription of drugs is a normal practice to the company. The labeling includes the indication of use of the drug and its warning. The company trains and expects its employees to be very meticulous in their work. This is very important so as to avoid people buying the wrong drugs or taking wrong dosages of the drugs manufactured by the company. The company also has restrictions placed on marketing and prescribing. (Skelly, 1995). However, the code of conduct of the company has also been shown to have some weaknesses. The company has many times encouraged their sales representatives to ignore doctors concerns on the products they are promoting. This has contradicted the company’s goals of promoting good health and continued innovation. There are many times when certain drugs produced by the company have faced major criticisms from qualified doctors. These doctors know that the drugs may have bad side effects on the people taking them. Therefore, the company wanting to gain profits from the sales of the drugs trains their sales representatives to ignore such sentiments from the doctors. (Williams, 2000). This risks the health of many patients and it may eventually send the company out of business because of bad publicity. The company has been accused of prioritizing profits over patient safety. It does not care what the people go through after taking their drugs because its major concerns are the profits that it will gain after selling the drug. (Bowie, et al. 1983). The company has also raised major concerns of the lack of transparency and effective leadership it has sometimes demonstrated. Such sentiments are bad for the company because the company often sells itself as having a good image. The company stands a danger of losing customers. There have also been instances when the company has been accused of holding unethical promotions. The personnel are encouraged to expand the indications of the drug, exaggerate its therapeutic efficacy and downplay its risks and adverse effects. This can be translated to a rip-off because consumers are literally cheated out of their money with the idea of making more profits. (Walton,1992). The self-regulatory codes that Merck Company has, delay meaningful reform. The codes are meant to make the company adhere to the rules and regulations put in place. Therefore, a reform is not easily adopted because many people fear change.  The voluntary codes are sometimes not audited or enforced; they can even be ignored. (Wilson, 2000)

Conclusion

Corporate codes should not aim at establishing a fixed set of core workplace right, but rather at creating a process that makes workplaces as good as they can be, and better over time, as companies become capable and national institutional capacities more developed. (Raynard, et al. 2001). Merck Company should aim at establishing corporate codes that aim at delivering good services to customers. The company should be able to understand the weaknesses of some of its codes so that it can be able to come up with new and better ones. The company has set codes to focus on cure rather than prevention strategies. These codes should be revised to favor patients so that it focuses more on the prevention strategies.

References

Anderson, E. (1993):  Value in Ethics and Economics.  Harvard University

Press. London

Rhys J. (2001): Corporate Codes of Conduct. Self-Regulation in a Global Economy. Oxford University Press. U.K.

Zadek, S. (2001): The Civil Corporation. The New Economy of Corporate Citizenship. Earthscan. The Copenhagen Centre.  Copenhagen.

 Donaldson, T. (1989): The ethics of international business. Oxford University Press. New York

 Beyer, H., Rojas, P. &Vergara, R. (1999): Trade liberalization and wage inequality. Journal of Development Economics, Vol. 59

Zadek, S., Hojensgard, N. &Raynard P.  (2001):  Perspectives on the new economy of corporate citizenship. The Copenhagen Centre. Copenhagen.

 Winston, M. (2002): NGO strategies for promoting corporate social responsibility. Ethics and international affairs. Vol. 16

Singer, P. (2002): One world: The ethics of globalization. Yale University  Press. New Haven, Conn. & London.

Skelly, J. (1995): The rise of international ethics. The Caux Round Table. Principles for business. Business ethics.

Williams, (2000): Global codes of conduct. An idea whose time has come. Notre Dame, Ind. University of Notre Dame Press.

Wilson, I. (2000): The new rules of corporate conduct. Rewriting the social charter. Westport, Conn. and London.

Walton, C. (1992): Corporate encounters. Ethics, law, and the business environment. Dryden Press. Fort Worth.

Sternberg, E. (2000): The nature of business. In Morality and the market. Ethics and virtue in the conduct of business. McGraw-Hill. New York.

Cragg, W. (2002):  Business ethics and stakeholder theory. Business ethics quarterly. Vol. 12.

Beauchamp, T. & Bowie, N. (1983):  Ethical theory and business. 2nd Ed. Prentice-Hall. Englewood Cliffs.

Appendices

Code of conduct- A list of required behaviors, the violation of which will result to a disciplinary action.

Code of ethics- Conveys organizational values, a commitment to standards, and communicates a set of ideals.

Ethics- Rules that found moral behaviors. A set of standards of conduct that guide decisions and actions based on duties derived from core values.

Corporate code of conduct- A formal statement of the values and business practices of a corporation.

Ethics centre- A centre dedicated to promote and maintain an ethical orientation.

Global compact- An international initiative that brings companies together with UN agencies, labor and civil societies in the areas of human rights, labor, the environment, and anti-corruption.

Compliance- Conforming or adapting ones actions to another’s wishes to a rule or to a necessity.

 

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