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Making Ethical Business decisions to protect and enhance Brands Image (Part 2/3)

Stakeholders Involved
–    Company
It is important to identify the company itself as a stakeholder, because depending upon the alternative the company chooses, the decision making will have a bearing on its subsistence in the future.

–    Consumers
Consumers are at the focal point of Pfizer’s business. Consumer awareness is increasing at an alarming rate in the recent years. Consumers nowadays are interested to know more about the products they are using (Rehne & Moldrup, 2008). When consumer awareness increases about the off-labelling issues, it can trigger a change in consumer preferences swerving loyal customers to deviate away from using Pfizer products. This could give rise to human rights violation issues in the media and public, raised by political pressure groups, where Pfizer could be accused of denying its consumers the basic rights of standardized health solutions. As result of which, Governments and Unions could impose sanctions on Pfizer, summing up to huge loss of revenue and market share.

–    Shareholders
The decision making of Pfizer determines the consequence of its shareholders attitude. Off-labeling accounts for estimated 60% of prescriptions in the U.S (The Doctor Will See You Now, n.d.). Separating itself from off-labelling will contribute to a further decrease in Pfizer profitability chaining the shareholders actions. On the flip side, continuing off-label activities could also affect shareholder reactions in a positive direction.

Note: For the purpose of speed and accuracy in decision-making, we must limit our stakeholders’ horizon to the above mentioned three entities. The limiting of the stakeholders is performed on the basis of entities that are directly and not indirectly affected by the company’s activities. This in no way means that, entities like Employees, Government, NGO’s, Anti-Human rights violation groups, Labour unions, etc are not considered as the stakeholders of the company.

Now that the ethical challenges as well as stakeholders involved in the ethical challenge are identified, Pfizer’s next stop on the itinerary should be to recognise the possible alternatives it has in order to react to the issue.

Alternative solutions
Evaluating the Off-labelling issue and considering the stakeholders involved in the situation, it seems convenient to narrow down the available alternatives into two distinct but obvious choices, namely,

o    Continue off-labelling
o    Discontinue off-labelling

Continuing off-label marketing is the approach, Pfizer and many of its top level competitors have adopted in order to leverage sales. It is interesting to note how these companies have been practicing off-label marketing strategically. Pfizer and its competitors are trying to swerve the generally non-acceptable off-label marketing view in the opposite direction, by trying to constantly appeal in favour of off-labelling (Edwards, J, 2007). But, there could be other alternatives available for Pfizer which could allow the company to have a convincing counter-argument approach in case of a negative outbreak against its activities.

Pfizer could start promoting lifestyle benefits indirectly while advertising its drugs for treatment of disorders. Let us take the example of Viagra. This drug was originally invented by Pfizer to treat Erectile Dysfunction in males (Viagra Official Site, n.d.) but the company has being promoting the sexual benefits indirectly via advertising without mentioning the side-effects and medical purpose of the medicine (ConsumerAffairs.com, 2004).  Instead Pfizer could try to promote Viagra’s lifestyle benefits indirectly while focussing on the primary topic being ‘Treatment for Erectile Dysfunction’. For example, a message like, “If you are Impotent (facing erectile dysfucntion) take Viagra and satisfy your partner’s expectations”, could prove helpful.

Meanwhile, the company could involve itself in more social activities to defend itself in the consumers psyche in the event of a negative outbreak against its unlawful activities.

Conversely, discontinuing its off-labelling activities could mean a complete turn back from the unlawful activity and reverting to other activities which could provide the company with some equally positive numbers. For example, instead of marketing immorally (if that’s how off-labelling is perceived) the company could spend that expenditure on marketing campaigns which are not perceived to be morally wrong. Such strategic marketing would mean increasing the reach of its products to needful consumers. In case of its Viagra drug, the company should try to make the drug easily available to potential and impotent consumers. This could mean, launching a helpline for privacy-centred or scared-to-admit impotent men or increasing promotions in rehabilitation centres taking into account that a large number of cases of Erectile Dysfunction are a result of addictions related to smoking, alcohol and drug abuse (Brochert, A, 2006). People wanting get rid of their addictions and who visit such rehab centres could be targeted as potential new consumers.

Basically, discontinuing off-label marketing would mean switching to traditional marketing tactics of opening new avenues in terms of market development.

–    The effect on the stake holders

Once the Stakeholders are recognised and the available alternatives are clearly, it is now important to evaluate how the above mentioned solutions would affect the stakeholders involved in this ethical challenge Pfizer is facing. The effects of continued off-labelling (Figure 3.1) and discontinued off-labelling (Figure 3.2) have been compiled in the respective tables below to provide a better understanding of the ethical dilemma Pfizer is facing.

Continued off-labelling
Continued off-labelling
Discontinued Off-labelling
Discontinued Off-labelling

–    Pfizer’s responsibilities and duties
Pfizer’s Responsibility towards its stakeholders could be clearly acknowledged by the following acts (Kaptein, M; Wempe, J, 1998),

Clarity and Transparency: Pfizer has a responsibility of maintaining utmost clarity and transparency when it comes to sharing of information with its stake holders. In our situation of off-labelling, the company may have a greater responsibility of practicing right to information towards its consumers. While Pfizer does recognise this in its ethical code of conduct (Pfizer.com Responsibility, n.d.); it is clearly evident that it is breaching the ethics code (Federal Bureau of Investigation, 2007, US Department of Justice, 2004).

Equality and Respect: the company also has to comply with a duty of treating its stakeholders with a highest regards of equality and respect. The company should make sure that all its operations are in the best interests of its directly related stakeholders; i.e. without prioritizing shareholders over consumers or vice versa. The company must respect the freedom-of-choice its consumers (product selection) and shareholders (holding or selling off shares) enjoy.

Recognition: Arguably one of the most important responsibilities of the company is to recognise what is expected from it by the stakeholders. In the current situation, the consumers expect full and substantiated information about the side effects and the safety profile of the medicines they use while the shareholders expect at least adequate amount of ROI (Return on Investments).

The responsibility Pfizer towards its stakeholders is a thoughtful task for the company. But this responsibility game is not a one-way affair; the stakeholders of the company also have a few responsibilities towards Pfizer. They are responsible to act consistently and constantly communicate with the company. Also, Pfizer has a right to expect not only a sense of respect  but also constructive participation from its stakeholders for making the ultimate decisions even if the choices made are awkward in nature (Kaptein, M; Wempe, J, 1998).

–    Personal bias
Considering I am a consultant, hired by Pfizer to make the decision in this ethical dilemma the company is facing, it is essential to take into account, my personal bias towards sensitive issues like off-labelling. We must also feed ourselves with a fact that our decision-making should not be dictated by our consumer and shareholders. Our personal interests need to be equally considered.

“In one incident, I came across a news article in India, where a 16 yr old boy died due to a wrong (off-labelled) medicine prescribed by his family GP to treat a minor Stomach-ache. Apparently, the salts present in the prescribed medicine triggered certain allergic reaction within the boy’s body causing a nervous breakdown, and eventually claiming his life. Such incidents can happen to anyone and at anytime. Incidents like this, have forced my conscience to stop or at least try to stop using drugs without getting a proper prescription from an authorized doctor. “

Previous experiences and knowledge affect a lot of our decision making process in the daily activities. I would like to stress on saying that issue like off-labelling affect me and my loved ones which forces me to think beyond profit-making about the existence of myself, my family & friends against the existence of a virtual entity, the company. My conscience, thus, may have a disproportionate influence towards discontinuing off-labelling activities implied by Pfizer INC.

Making Decisions
Finally after identifying the stakeholders, narrowing down on the available solutions and how they affect the stakeholders, recognizing our responsibilities towards our consumers and shareholders and taking into account the personal bias of the decision making consultant, we now need to take the final action to hedge against the ethical challenge. This is when company finally narrows down to a single action to be taken to tackle against the dilemma by conducting a detailed ethical analysis of choosing the right kind of ethical approach.

Stakeholders Involved
–    Company
It is important to identify the company itself as a stakeholder, because depending upon the alternative the company chooses, the decision making will have a bearing on its subsistence in the future.

–    Consumers
Consumers are at the focal point of Pfizer’s business. Consumer awareness is increasing at an alarming rate in the recent years. Consumers nowadays are interested to know more about the products they are using (Rehne & Moldrup, 2008). When consumer awareness increases about the off-labelling issues, it can trigger a change in consumer preferences swerving loyal customers to deviate away from using Pfizer products. This could give rise to human rights violation issues in the media and public, raised by political pressure groups, where Pfizer could be accused of denying its consumers the basic rights of standardized health solutions. As result of which, Governments and Unions could impose sanctions on Pfizer, summing up to huge loss of revenue and market share.

–    Shareholders
The decision making of Pfizer determines the consequence of its shareholders attitude. Off-labeling accounts for estimated 60% of prescriptions in the U.S (The Doctor Will See You Now, n.d.). Separating itself from off-labelling will contribute to a further decrease in Pfizer profitability chaining the shareholders actions. On the flip side, continuing off-label activities could also affect shareholder reactions in a positive direction.

Note: For the purpose of speed and accuracy in decision-making, we must limit our stakeholders’ horizon to the above mentioned three entities. The limiting of the stakeholders is performed on the basis of entities that are directly and not indirectly affected by the company’s activities. This in no way means that, entities like Employees, Government, NGO’s, Anti-Human rights violation groups, Labour unions, etc are not considered as the stakeholders of the company.

Now that the ethical challenges as well as stakeholders involved in the ethical challenge are identified, Pfizer’s next stop on the itinerary should be to recognise the possible alternatives it has in order to react to the issue.

Alternative solutions
Evaluating the Off-labelling issue and considering the stakeholders involved in the situation, it seems convenient to narrow down the available alternatives into two distinct but obvious choices, namely,

o    Continue off-labelling
o    Discontinue off-labelling

Continuing off-label marketing is the approach, Pfizer and many of its top level competitors have adopted in order to leverage sales. It is interesting to note how these companies have been practicing off-label marketing strategically. Pfizer and its competitors are trying to swerve the generally non-acceptable off-label marketing view in the opposite direction, by trying to constantly appeal in favour of off-labelling (Edwards, J, 2007). But, there could be other alternatives available for Pfizer which could allow the company to have a convincing counter-argument approach in case of a negative outbreak against its activities.

Pfizer could start promoting lifestyle benefits indirectly while advertising its drugs for treatment of disorders. Let us take the example of Viagra. This drug was originally invented by Pfizer to treat Erectile Dysfunction in males (Viagra Official Site, n.d.) but the company has being promoting the sexual benefits indirectly via advertising without mentioning the side-effects and medical purpose of the medicine (ConsumerAffairs.com, 2004).  Instead Pfizer could try to promote Viagra’s lifestyle benefits indirectly while focussing on the primary topic being ‘Treatment for Erectile Dysfunction’. For example, a message like, “If you are Impotent (facing erectile dysfucntion) take Viagra and satisfy your partner’s expectations”, could prove helpful.

Meanwhile, the company could involve itself in more social activities to defend itself in the consumers psyche in the event of a negative outbreak against its unlawful activities.

Conversely, discontinuing its off-labelling activities could mean a complete turn back from the unlawful activity and reverting to other activities which could provide the company with some equally positive numbers. For example, instead of marketing immorally (if that’s how off-labelling is perceived) the company could spend that expenditure on marketing campaigns which are not perceived to be morally wrong. Such strategic marketing would mean increasing the reach of its products to needful consumers. In case of its Viagra drug, the company should try to make the drug easily available to potential and impotent consumers. This could mean, launching a helpline for privacy-centred or scared-to-admit impotent men or increasing promotions in rehabilitation centres taking into account that a large number of cases of Erectile Dysfunction are a result of addictions related to smoking, alcohol and drug abuse (Brochert, A, 2006). People wanting get rid of their addictions and who visit such rehab centres could be targeted as potential new consumers.

Basically, discontinuing off-label marketing would mean switching to traditional marketing tactics of opening new avenues in terms of market development.

–    The effect on the stake holders
Once the Stakeholders are recognised and the available alternatives are clearly, it is now important to evaluate how the above mentioned solutions would affect the stakeholders involved in this ethical challenge Pfizer is facing. The effects of continued off-labelling (Figure 3.1) and discontinued off-labelling (Figure 3.2) have been compiled in the respective tables below to provide a better understanding of the ethical dilemma Pfizer is facing.

–    Pfizer’s responsibilities and duties
Pfizer’s Responsibility towards its stakeholders could be clearly acknowledged by the following acts (Kaptein, M; Wempe, J, 1998),

Clarity and Transparency: Pfizer has a responsibility of maintaining utmost clarity and transparency when it comes to sharing of information with its stake holders. In our situation of off-labelling, the company may have a greater responsibility of practicing right to information towards its consumers. While Pfizer does recognise this in its ethical code of conduct (Pfizer.com Responsibility, n.d.); it is clearly evident that it is breaching the ethics code (Federal Bureau of Investigation, 2007, US Department of Justice, 2004).

Equality and Respect: the company also has to comply with a duty of treating its stakeholders with a highest regards of equality and respect. The company should make sure that all its operations are in the best interests of its directly related stakeholders; i.e. without prioritizing shareholders over consumers or vice versa. The company must respect the freedom-of-choice its consumers (product selection) and shareholders (holding or selling off shares) enjoy.

Recognition: Arguably one of the most important responsibilities of the company is to recognise what is expected from it by the stakeholders. In the current situation, the consumers expect full and substantiated information about the side effects and the safety profile of the medicines they use while the shareholders expect at least adequate amount of ROI (Return on Investments).

The responsibility Pfizer towards its stakeholders is a thoughtful task for the company. But this responsibility game is not a one-way affair; the stakeholders of the company also have a few responsibilities towards Pfizer. They are responsible to act consistently and constantly communicate with the company. Also, Pfizer has a right to expect not only a sense of respect  but also constructive participation from its stakeholders for making the ultimate decisions even if the choices made are awkward in nature (Kaptein, M; Wempe, J, 1998).

–    Personal bias
Considering I am a consultant, hired by Pfizer to make the decision in this ethical dilemma the company is facing, it is essential to take into account, my personal bias towards sensitive issues like off-labelling. We must also feed ourselves with a fact that our decision-making should not be dictated by our consumer and shareholders. Our personal interests need to be equally considered.

“In one incident, I came across a news article in India, where a 16 yr old boy died due to a wrong (off-labelled) medicine prescribed by his family GP to treat a minor Stomach-ache. Apparently, the salts present in the prescribed medicine triggered certain allergic reaction within the boy’s body causing a nervous breakdown, and eventually claiming his life. Such incidents can happen to anyone and at anytime. Incidents like this, have forced my conscience to stop or at least try to stop using drugs without getting a proper prescription from an authorized doctor. “

Previous experiences and knowledge affect a lot of our decision making process in the daily activities. I would like to stress on saying that issue like off-labelling affect me and my loved ones which forces me to think beyond profit-making about the existence of myself, my family & friends against the existence of a virtual entity, the company. My conscience, thus, may have a disproportionate influence towards discontinuing off-labelling activities implied by Pfizer INC.

Making Decisions
Finally after identifying the stakeholders, narrowing down on the available solutions and how they affect the stakeholders, recognizing our responsibilities towards our consumers and shareholders and taking into account the personal bias of the decision making consultant, we now need to take the final action to hedge against the ethical challenge. This is when company finally narrows down to a single action to be taken to tackle against the dilemma by conducting a detailed ethical analysis of choosing the right kind of ethical approach.

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