Business Ethics Case Study On Johnson &Johnson

Question

Task: Part 1: Business ethics case study
a) You are required to write a brief report for senior managers at the case of your choosing. This report is written from the perspective of a middle manager tasked to outline the ethical dimensions of the issues from the case. You will need to explore a number of factors including - Why should this be explored as an ethical question? How might the company want to think about the role of business in society? You will also need to outline who the key stakeholders are and in what way they are affected. You should include research into examples of how ethical choices impact on other companies (e.g. where is there research that shows good choices benefit companies and bad choices have a negative impact?). Finally, you should conclude with some recommendations for what the company should do

This part of your assessment should be written as a report, but should be referenced in the normal academic way using Harvard citations and referencing.

b) For this part you should again use your chosen case study – but this time choose TWO ethical theories and demonstrate that you can apply these to the case to show how your chosen theories lead you to a view on the ethics of the case. This is written as an academic paper.

Part 2
Part 2 is NOTrelated to the business ethics case study. This section requires you to discuss what make an ethical leader and how you would, as an ethical manager, manage your business and/or others to a high ethical standard. You will need to think about personal ethics, about the conditions that bring about unethical organisations and practices, about organisational values and methods of compliance. This part can be written in a more reflective style

Answer

Part 1
a) Report to the senior manager on the sales and marketing of opioids:
As per the business ethics case studyon Johnson & Johnson (J&J), the companyought toconsider thematter from the ethical perspective to uphold the wellbeing of the patients as a priority while profit-making as itssecondary objective.But this is not in the case for J&J as the promotion of the drugs is not based on sound scientific data against the company’s claim of its medicines(McGreal, 2019). The promotional campaigns are not balanced and the product details circulated are deceptive. Promoting thecompany’s drugs containing a high quantity of opioids should be re-looked as there is very little evidence to suggest that the pain-relieving drugs are better than ordinarily prescribed paracetamol tablets.J&J’s advisory board is against such practices andthe company had already been warned by the Food and Drug Administration about its high strength fentanyl drug Duragesic. There are questionable ethical marketing exercises like theleaflets, coupons distributed to the doctors’ chambers,and patients are often deceptive and do not disclose the full details about the drug.This kind of sales campaign will questionthe company’s ethics as only the non-prescription drugs should be advertised to the public.The information about the drugs sold via the online medium also downplayed the drug’s side effects and not complying with ethical practices(McGreal, 2019). The marketing of J&J’s brand is acceptable but the marketing of a prescription drug to cure certain diseases is not ethical at all.

Proper research data of the drug is not made available to the doctors to make correct decisions in recommending the drug. The medical representatives are also misleading doctors to put down their guards while prescribing the drugs. As per the research on business ethics case study, it can be stated that the sales representatives are being trained to specifically dispelfears among doctors without divulging the risk of the addictive drugs without giving the doctors access to evidence-based material of the drug(Bowie, 2017).

The targetedpatients fall under the susceptible age categoryof below 40 years, more prone to abuse the drugs.Unfortunately the consultant company Mckinseyis also recommendingturning the focus on doctors who are already prescribing similar prescribing drugs like Oxycontinmanufactured by the pharmaceutical company Purdue(Mansoor, 2019).It is also seen in the present business ethics case studythat the Doctors weremisled by the company that chronic pain could be treated by the new opioid drugs stating it appropriate for patients withchronic painhistory. This is the marketingtacticwhich is not supporting the rational use of the drug but amplifying its medicinal properties for commercial sale.

The obvious side effects of the drugs are often not disclosed and projected as the drugs with very limited risk of abuse(Parramore, 2017).J&J is conniving with other pharmaceutical companies to push these drugs into markets which might have devastating effects causingopioid addiction and even death. The company is twisting research findings of the drugs andmanipulating influence several pain advocacy communities to prescribe such medicines bydoctors and medical professionals(Pearson, 2017).This is against medicalethics to sell medicine solely for profiteering.

Thereare startling figures which reveal the rampant prescription of opioid drugs. Oklahoma witha population under 4 million,about 18 million opioid drugs were prescribed from 2015-2018.

This issue identified in the business ethics case studywill surely dent the image of J&J which had built its reputation as responsible and publicfriendly through itsbaby powder, soap, and Band-Aid.So its image would be tarnished beyond salvation. Drug abuse and drug addicts are considered as a social stigma and some families who are trying to help their near and dear ones to come out of this habit. Many young lives were lost to drugs due to itsaddiction, and overdose(Mind, 2015).Toenvisage thatbabies born were exposed to opioids the company would lose its credibility as unsafe for the public.The company would be looked at as exacerbating a complex public health issue like an opioid crisis and acting irresponsibly.

The way J&J conducts its business reminds of Milton Friedman who believed that a company exists only to do so business, for maximising profits(Ghillyer, 2014).Its obligation lies with the shareholders only andit has no responsibility towards the community. The company’s approach should be more inclined towards that of Freeman who thought of adding value to shareholders through paying attention to clients, service providers, workforces, communities, and shareholders simultaneously(Pearson, 2017). The readings used to prepare this business ethics case study signifies that the perception of the people towards the company goes hand in hand as to how it is treating its communities, the downtrodden. The activities of a company towards its social responsibilities create an identity among the public.People can easily associate the big corporates with the type of activities the company is associated with(Bowie, 2017). So although the local community is not a stakeholder there are people in the community that might become potential stakeholders and the company should not absolve its responsibilities.

There are many stakeholders in the community that the company should care about. The company is fiercely marketing its opioid drugsdirected towardsthe safety of women, teenagers, and senior citizens. Patients were suffering from pain and pain specialists, doctors with whom the company is actively engaged. The company is maintaining that its opioid drugs are safe to use and there are minimalistic changes of addiction(Triggle, 2019). Other stakeholders would be the criminal justice system, healthcare, foster care,and medical treatment facilities who would be bearing the brunt of the damages caused by opioid drugs. Wyeth Pharmaceuticals, owned by Pfizer came under fire for hiring speakers who prescribed particular drugs. They were also accused of rejecting speakers who did not prescribe the drug.

GlaxoSmithKline has levied a heavy penalty in 2010 for deliberately selling contaminated baby ointment. It also received flaks for its ineffective antidepressants and promoting its consumers under the age of 18 which was not approved by U.S. Food and Drug Administrators.The same company received a lot of admiration in 2010 in the Ethical Corporation Responsible Business Summit when they dropped a 25% price of patented drugs globally(Parramore, 2017).

In the developing countries,they also agreed to reinvest 20% of the profit from medicinessales toimprove medical infrastructure in those countries(the Guardian, 2019). The company hadacknowledged the stakeholders in the community and it paid off.They became more transparent with their policies and overhauled their corporate strategies.

The safety of the patients should be the first and foremost priority of the company.It has to comply with high standards of quality as laid down by the Food and Drug Administration(Mind, 2015).Its interactions with the stakeholders in the society have to be moral, proper, and professional.The public has more information nowadays due to strong media but has limited access to ascertain the correct information.

Its actions should not be to lure an advantageous positionby offering incentives, gifts, and donations to the medical fraternity for prescribing its medication(Pearson, 2017).The effect of advertising can significantly influence the understanding and anticipation of the performance of aparticular drug and the company must be thoughtful in their approach and the consequences.

It is recommendable herein business ethics case study that J&J should provide all scientifically backed data and the promotional activities should divulge accurate information. The drugs of the company ought to have proper labelling mentioning the components used, and the adverse actions of the drug(Bowie, 2017).Its research must be done to benefit patients and advance knowledge of medical science makingthe drug available to the right patient.

b) Which ethical theories are based on the report on business ethics case study analysis?
Utilitarian perception –
Utilitarianism is a consequentialist theory and it judges the outcome of an act based on whether it provides the utmost benefit to the largest number(Bowie, 2017). It is based on the principle that actions are right to the proportion of benefits it yields and wrong as they tends to produce just the opposite of benefit. On deciding the utility of action it is not merely the benefit of the decider that should be considered but the benefit of the entire population who would be affected by the resolution. According to some contemporary utilitarian thinkers, it should not only be the benefits or happiness but the overall well-being must be thought of(Chell, et al., 2016). The concept depends entirely on the ethical principle of usefulness to decide the morality of a decision. Pain is a universal problem with millions of people worldwide suffering from chronic pain. There is widespread consensus among the medical fraternity thatthe use of opioids can be used to treat chronic malignant pain.Evidence also suggests that chronic pain has been undertreated and there is room for improvement(Bowie, 2017).Emergency room doctors promote utilitarianism thinking as they have been using opioids. Past studies have shown that opioids can treat chronic pain and act as anti-convalescents and have a reasonable safety profile, though it can also lead to other ailments(Ghillyer, 2014).Contrarily, apart from the point of managing pain, the utilitarian view might consider the negative societal reactions such as opioid addiction, signs of habit inducement.It leads to criminal activities and multi-organ failures when the pain could be managed by other drugs. To be fair in their business operation pharmaceutical companies should use clinically moral practices(Maon, et al., 2017).It should not be population-based rather based on the individual needs of people, paying attention to the health of the patient, psychological factors, and the possibility of enhancing the quality of life.

Utilitarian view used in the present context of business ethics case studycould be said to be based on subjective preferences as for the benefit of a minor few it could result in negative consequences for the major population(Weiss, 2014).It has been often criticized allowing relaxing of rules that would otherwise oppose the standards. In this context usage of opioids would open gates to rampant misuse of opioids which otherwise would be restricted because of their addictive nature. Certain medical associations of physicians are also taking a utilitarian view on the usage of opioids. They opine that doctors should decide when to prescribe opioids after considering the benefits that the patient would get against the cost of the wrong medication(Hartman, et al., 2018).

To relieve pain for patients requiring limited dosages for a short period, lacking access to other substitute drugs, opioids should certainly be considered.The trade-offs of using opioids are acceptable when compared with the availability of other drugs, their efficiency, and the benefits that might be lost if the opioids are not applied(Copeland, 2016). Therefore, as noted in this business ethics case study it makes wisdom to think from the perspective of utilitarian to reap the benefits of opioid for the better good of humanity.This is because the maximization of achieving certain health benefits with few limitations are ethically valuable. For the greater good of mankind advertising and promotion of opioids should be allowed with check mechanisms in place.

Kantian perception –
German theorist Kant was an opponent of the utilitarian concept. Kant's theory reasons that moral action should be applied to everyone under any circumstances without thinking of the consequences. Kantian theory respects the humanity in every individual and opines that action or decisions would be in tune with rules that are true for everyone(Maon, et al., 2017). The Kantian theory is to act rationally with universally accepted principles. Itadvocates the free and independent will of an individual. In this context, chronic pain suffering is desensitizing and diminishing the self-worth of the patient and can be treated with opioid drugs under the right conditions and dosage. Under this situation as portrayed in the business ethics case study, physicians must lessen pain and other drawbacks of opioids drugs are irrelevant when compared to the acute need of the patient to ease the pain. Applying Kantian theory, the physicians could only observe the patient’s physical pain(Mansoor, 2019).But would not know of the astute relationship between mind and matter and the fundamental nature of the pain the patient is suffering. According to Kant's view as the humankinds’ knowledge expand, they understand their insignificance in the universe,simultaneouslyexpandingtheir innate moral principles(Bowie, 2017). Developing such infinite values would assist the doctors in treating patients battling chronic pain to evaluate and considerate in their decisions. The moral physicians would go beyond the limits of strict duties and take decisions as per the need of the hour.

To be fair in this complex scenario, the patients should be made available all medical care at their disposal. It is to give them relief from their painful condition and the usage of opioid drugs should be made available to them. In doing so it the decisions would be rational, based on pure reasoning of human nature,and not restricted simply by laws of nature(Triggle, 2019). Kant’s version supports the view that the patient should have access to opioid drugs to prevent them from any other self-injuring thoughts like suicide to alleviate them from their troubles. The Doctors’ rational thinking would naturally urge them to prescribe opioids to prevent self-harm to the patients(Ghillyer, 2014). Kant’s views respect the patient’s liberty in their choice, upholding their dignity to a meaningful life, and offer a build-up of a moral relationship between the doctor and the patient.

The patient and his family members would have a choice to make a decision fully aware of the potential drawbacks of prescribing opioids. The doctors would also be acting morally as they would know the existence of a drug. It might be to ease the pain and to administer the opioid medicine they would be acting conscientiously(Hartman, et al., 2018). For the doctors’failure to administer a drug that could help assist the patient with the disease would be an irrational decision. As per Kantian view the doctors would be doing a strict duty which would be termed as doing justice and respecting the right to live a dignified life of the patient(Copeland, 2016). Kant’s philosophy could develop a deeper sense of duty for the medical fraternity and sound principles for the doctors. The Kantian theory would support the availability of opioids to terminally ill patients, suffering from immense pain to relieve them of their troubles.

Part 2
To be an ethical leader I would be known for being honest, fair, unbiased, and respectful to others. I should be able to develop team spirit amongst my team members, led by examples and my decisions based on sound values. I would never back away from my principles of running the business to avoid conflicts. I would not be afraid to make the ethically correct decisions regardless of the consequences or fear of repercussions from other stakeholders such as the Board of Directors of the company(Bowie, 2017). My core values would reflect on my actions and behaviours. As a business leader, I would hold accountability for my business decisions. I would set the ethical code of running business operations and set it as a priority for all stakeholders associated with the organisation.

I would identify tricky situations that would snowball into something big if they are not dealt with at the right moment. Tricky situations like decisions on purchasing, the advancement of employees, behavioural issues are bound to attract ethical dilemmas and have to carefully consider the weightage of varied factors before making a decision. I would consult and respect the view of others to understand the possibilities that I might have overlooked. I would study the industry trends, change in business conditions to predict the future course of business,and foresee the consequences(Mansoor, 2019). I would like to mention in this part of business ethics case study analysis that my decisions would consider both short-term and long-term implications and the consequences on the stakeholders in the company.

I have to evaluate the outcome of my decisions on environment, employees, customers, vendors, and the community wherein my business operates and should not only be profit-oriented. Decisions taken hastily about business growth, cost control might result in negative impacts on the shareholders and public image of the company. I would evaluate my past business decisions to learn from previous mistakes(Copeland, 2016). I should also learn from the ethically good practices used by the competitors to incorporate it into our business and look for means to use economically sustainable measures. I would use the industry norms of my business as the starting point of laying down rules. It is to come out of the belief that if my method of conducting business is lawful then acceptable.

The industry regulations often normally lay down minimum norms to adhere to conduct business which could be adhered to and still be unethical. I have to consider the full range of moral obligations particularly when it is related to the public trust of the organization.My method of running business functions would exceed all norms and regulations and proceed further than other competitors. These are times the barriers of doing ethical business and the purpose of a business should serve the greater good to mankind. I should consider my judgment before justifying the reasons for my actions and treating non-ethical actions as moral eventuality. I would realize that the necessity of adopting a specific way of conducting business isan interpretation of an individual’s perspective and not a reality(Weiss, 2014).

It is stated in this business ethics case study analysis that I would refrain from falling into the false necessity trap by overestimating the price of doing the right thing and underrating the great cost of failing to do the right thing. I do not want to be a popular leader by giving into the unjustified demands of the stakeholders and focus only on profits without looking into the moral implications of business. I should realize that there are two frames of mind that go hand-in-hand, the business mind frame and the ethical mind frame and both are interlinked. There are significant differences in these two outlooks but for the long-term sustainability of the organization, the ethical mindset would play an important role besides making profits. These mindsets would help to define the principles of the company so that the organization does not overly stress the employees to make profits without taking in moral considerations(Triggle, 2019). As a leader,I welcome the employees to come up with their opinions when they feel that certain business decisions would be unethical to the community.

References
Bowie, N., 2017. Business ethics: A Kantian perspective.Business ethics case studyLondon: Cambridge University Press.

Chell, E., Spence, L., Perrini, F. & Harris, J., 2016. Social entrepreneurship and business ethics: Does social equal ethical. Journal of business ethics, 133(4), pp. 619-625.

Copeland, M. K., 2016. ‘The impact of authentic, ethical, transformational leadership on leader effectiveness'. Journal of Leadership, Accountability and Ethics, 13(3), pp. 79-97.

Ghillyer, A. W., 2014. Business ethics now. New York: McGraw Education.

Hartman, L. P., DesJardins, J. & MacDonald, C., 2018. Business Ethics – Decision Making for Personal Integrity & Social Responsibility. 4th ed. Boston: McGraw Hill Education.

Mansoor, S., 2019. Johnson & Johnson's $572 Million Opioid Crisis Judgment Could Be Just the Beginning. [Online]

Available at: https://time.com/5662827/johnson-opioid-crisis-lawsuits/

Maon, F., Swaen, V. & Lindgreen, A., 2017. One vision, different paths: An investigation of corporate social responsibility initiatives in Europe. Journal of Business Ethics, 143(2), pp. 405-422.

McGreal, 2019. Capitalism gone wrong: how big pharma created America's opioid carnage. [Online] Available at: https://www.theguardian.com/us-news/2019/jul/24/opioids-crisis-big-pharma-drugs-carnage

McGreal, C., 2019. Johnson & Johnson to pay $572m for fueling Oklahoma opioid crisis, judge rules. [Online]

Available at: https://www.theguardian.com/us-news/2019/aug/26/johnson-and-johnson-opioid-crisis-ruling-responsibility-oklahoma-latest Mind, 2015. Cognitive behavioural therapy (CBT). [Online]

Available at: https://www.mind.org.uk/information-support/drugs-and-treatments/cognitive-behavioural-therapy-cbt/#.WTkedIWcFlY [Accessed 24 June 2019].

Parramore, L., 2017. “Worse Than Big Tobacco”: How Big Pharma Fuels the Opioid Epidemic. [Online]

Available at: https://www.ineteconomics.org/perspectives/blog/worse-than-big-tobacco-how-big-pharma-fuels-the-opioid-epidemic

Pearson, R., 2017. Business ethics as communication ethics: Public relations practice and the idea of dialogue. In: Public relations theory. Perth: Routledge, pp. 111-131.

the Guardian, 2019. Opioid addiction rising in India as US drugmakers push painkillers. [Online]

Available at: https://www.theguardian.com/world/2019/aug/28/india-opioids-addiction-us-drugmakers-push-painkillers Triggle, N., 2019. Too many 'hooked' on prescription drugs. [Online]

Available at: https://www.bbc.com/news/health-49639914 Weiss, J., 2014. Business ethics: A stakeholder and issues management approach. London: Berrett-Koehler Publishers.