|Chapter 4: Drug Marketing|
Multinational companies (MNCs) are complex, highly technical structures, with economic and political clout often exceeding that of the governments of the countries where they operate. In a bid to expand their markets internationally, MNCs resort to business practices which may be unethical. They are known to take advantage of the economic weaknesses of the host countries to conduct operations of almost criminal nature which have deep adverse effects on the host country's economy, human health and environment.
Such practices are unpardonable particularly when MNCs engage in operations which are not allowed in the countries of their parent companies due to strict governmental regulations. Because of MNCs' almost unlimited capabilities to tap physical, financial and human resources around the world, using centralised techniques, management and communications, MNCs can undermine the priorities of host countries, upset their fiscal and monetary policies, dominate key sectors of the economy, create nagging balance of payment problems, and in extreme cases, bring about the downfall of governments unsympathetic to their interests. Their financial power and easy access to the top hierarchy of government and business may be used, openly or covertly, to influence the domestic political process to their liking. Their pressures for corruption in the small host states, are therefore, great (13).
In the Philippines, multinational companies have been amassing considerable profits, draining dollar reserves of the country by unlimited profit repatriation of capital. They institute other forms of economic controls such as management contracts, licensing, franchise, technical agreements, transfer pricing and sub-contracting. The multinational drug industry is dominated by such big MNCs as Pfizer, American Cyanamid, Bristol Myers, Squibb and Upjohn - all of which were exposed in the U.S. Senate in 1966 (14) as having for several years engaged in a worldwide conspiracy to establish, and also having established a worldwide cartel to fix the price of "wonder drugs"- broad spectrum antibiotics - at identical, grossly inflated and unconscionable high prices. (15).
to Chetley, on an average, pharmaceutical companies spends around 15-20
per cent of its turnover on marketing and promotion which is about two
to three times as much as it spend on research (16).