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Reputation Institute study finds that the reputation of pharma companies is in decline and might get worse before it gets better.
The pharma industry’s reputation is in decline. According to Reputation Institute’s (RI) most recent study, the reputation of pharma companies might get even worse before it gets any better. This year, RI conducted research on the reputation of the US pharma industry among the informed general public-that is, those who identified as somewhat or very familiar with the measured companies they were asked to evaluate. The study took place in January and February of 2018. It included 22 nominated companies and was comprised of a sample based on 2,608 individual ratings.
What did the study reveal in the wake of a challenging 18 months for the healthcare industry and following recent increased scrutiny of pharma companies?
There is a significant erosion of trust, fueled by a nation and pharma industry that’s under reputational duress.
The decline in reputation of the pharma industry can be attributed to the erosion of underlying trust and a growing culture of corporate criticism. Versus the same period in 2017, the reputation of all companies among the US public dropped 3.7 points. This decline was at the same rate of decline as the US pharmaceutical industry, indicating a new era of growing scrutiny and skepticism of pharma companies. The resultant impact is a freefall in overall levels of support, with a 13% drop in trust and 14% decline in benefit of the doubt for pharma companies in the US.
But what’s a pharma company to do to turn things around, increase trust, and ultimately enhance reputation?
Here are nine prescriptive reputational insights for the pharma industry:
US Pharma RepTrak® 2018: How Do Companies Compare?
It’s not all bad news. There are winners and losers in the category within the US, with some pharma companies such as Sanofi, Genentech, and Celgene outperforming the competition to earn a strong reputation.
By way of example, what did Sanofi do to out-perform pharma industry competition?
Sanofi wins on ethics and good governance: CSR is integral to its purpose
Sanofi tops the list as the most reputable pharmaceutical company in 2018, with a strong score of 74.6-that’s 7.7 points higher than the pharma industry as a whole. Sanofi has the highest scores in products/services, openness/transparency and supporting good causes, which is reflected in both their public communication of their mission and in their Corporate Social Responsibility (CSR) model. Its website highlights the company’s commitment to ethics and transparency, outlining the proactive steps they are taking to decrease animal testing, introduce integrity modules and audits, and publish clinical trial results for the public to view. Its CSR model has three components: planet, people, and ethics-a progressive shift from traditional models, which highlights financial responsibility instead of ethical behavior. Sanofi’s proactive actions are delivering real reputational results.
Sanofi’s commitment to transparency and focus on ethical governance is what the top-ranked pharma companies worldwide convey in their mission. This is no coincidence. Reputation points directly to what matters most to drive positive change.
Meghan Burke is a research analyst at Reputation Institute.
RI announced it's annual US pharma RepTrak ratings here.