Big pharma needs to fix its trust problem

Now is a time of opportunities and challenges in healthcare. We are making incredible progress: Technological advances are allowing us to accelerate the pace of innovation, and help innovations scale up more quickly. Advances in cell therapy, better understanding of the underlying causes of disease, and increasing use of digital technologies in healthcare are all driving medical innovation.

Innovation in health is not limited to the pharmaceutical or healthcare industry; for example, Novartis is collaborating with Google on “smart lens” technology in an effort to benefit people with diabetes and vision disorders. This is not innovation for innovation’s sake – the goal is to continue to improve quality of treatments and health outcomes, ultimately benefiting patients.

We are already beginning to see the impact of medical progress on society in the form of powerful demographic shifts. According to the United Nations, the number of people over the age of 50 is projected to increase by about 500 million, accounting for 25 per cent of the global population by 2025, as improvements in healthcare and living standards help people live longer.

As populations grow and age, investments in healthcare by governments, private insurers and individuals continue to increase, straining national and individual budgets. We expect healthcare spending to more than double by 2025, to $15 trillion (U.S.).

This increase has put our industry under intense scrutiny globally. Cutting costs has become a priority for governments and payers around the world, with a focus on getting the most value for money spent on healthcare products and services.

At the same time, the pharmaceutical industry is in the midst of a crisis of trust: Nearly every company has seen accusations of ethical breaches, including corrupt marketing practices, conflicts of interest and a lack of transparency around clinical trial results. Medical innovations cannot be effective without the trust of those who use them. The patients who take our products depend on these treatments to improve health and generate positive outcomes. Patients and physicians need to trust both the quality of the treatments themselves, and the integrity of the company.

All companies within the industry understand and respect the need for greater transparency and for further strengthening our ethical business practices, because when companies that make life-saving treatments lose credibility, patients ultimately suffer.

At Novartis, we have taken concrete actions in the past year to bolster ethical behavior and improve our ability to fulfill our core mission of caring and curing. The creation of my current position, Chief Ethics, Compliance and Policy Officer, which reports to the CEO, was one measure. It elevated the compliance function in the company to the highest levels and aims to further ingrain ethics into the Novartis culture.

We have also increased the emphasis on integrity among the values and behaviours Novartis associates are expected to uphold. Employee incentives are increasingly aligned to these values and behaviors, so compensation is directly linked to accountability.

Finally, we have announced progress on improving clinical trial data transparency. Novartis was the first company to publish trial results of innovative medicines within one year of study completion, regardless of outcome. In 2014, we announced that Novartis would provide access to anonymized patient-level data and expanded information about clinical trial results. We also issued new guidelines for all investigator-initiated trials that we run worldwide.

Looking ahead, I expect continued actions to rebuild trust to drive the industry. Corporate responsibility needs to be at the centre of these actions. While we have made considerable progress, being proactive is not enough. Regrettably, there will always be potential pockets of bad behavior in global businesses, and all companies need structures to react to these situations swiftly and prevent them from occurring again.

Companies like Novartis will further develop ethical standards across a range of business activities, focused on customers and patients. As an industry, we need to go beyond laws and regulations to rebuild trust among patients, healthcare providers and payers.

More dialogue between key health stakeholders – regulators, payers, patient advocacy groups and companies – is essential to move forward and to ensure patients have access to the best care.

Eric Cornut was one of the judges who participated in the final round of the CK-Schulich Business for a Better World case competition held in Davos, Switzerland, in late January. His company, Novartis, was the case subject.

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