Pharma Failing to Address Corruption Risks, Says Report

June 3, 2016

Policy makers "simply are not taking seriously the corrosive effect of corruption", study says.

The global pharmaceutical sector is wide open to corruption abuse, with both governments and companies failing to properly address corruption risks, according to new research from Transparency International (TI).

As of the beginning of 2016, one in 10 corruption investigations by US authorities involve pharmaceutical companies, significantly higher than the banking sector, TI reports.

Sophie Peresson, Director Transparency International Pharmaceuticals & Healthcare Programme commented: “It is shocking that despite scandal after scandal involving pharma companies, still policy makers simply are not taking seriously the corrosive effect of corruption. The red flags are being ignored.”

Transparency International’s research found measures to combat corruption "inadequate" across the following areas:

  • Research and development – raw data from research is publicly available in only a handful of countries.

  • Marketing – Nearly half of investigated health sector corruption cases relate to sales and marketing. 

  • Manufacturing – Severe lack of enforced regulation to prevent circumnavigation of manufacturing standards through bribery and corruption. 

  • Distribution – Many countries have little or no safeguards against vital medicines simply disappearing during the distribution process. 

Transparency International identifies four key challenges to preventing corruption in the pharmaceutical sector:

  • Global institutions, governments and companies not committed to preventing corruption.

  • Lack of knowledge and understanding of corruption by policy and decision makers.

  • Weak national and international legislation and regulation due to underinvestment and a lack of oversight. Unbridled power of companies to influence decisions relating to healthcare.