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November 20, 2014
2014 Access to Medicine Index Published
    by Robert Kropp

Sustainable investors note improvements by pharmaceutical companies in areas of access and affordability but call for more rigorous codes of conduct and transparency around when patents will expire. First of a two-part series.

Published every two years, the Access to Medicine Index addresses a global inequity in which much of the pharmaceutical industry is complicit: “An estimated two billion people still do not have access to the health-related products they need,” the recently published 2014 version of the Index states.

The Index focuses its analysis on the activities of major pharmaceutical companies in developing nations; the 2014 version was expanded to include more Latin American countries, and additional diseases as well.

“The pharmaceutical industry is continuing to step up its efforts to improve access to medicine in developing countries,” the Index states. “The number of relevant products in the pipeline has grown, companies are increasingly tailoring prices between countries and within countries, and more companies are experimenting with innovative access-oriented business models.”

For the fourth consecutive time, GlaxoSmithKline was ranked first among the 20 largest pharmaceutical firms analyzed in the Index. Novo Nordisk rose from sixth in the previous Index to second, “partly due to its integrated approach to access to medicine, high level of transparency and robust codes of conduct, for which evidence of auditing was provided,” the Index reports. “It renewed its access strategy in 2013, has applied equitable pricing strategies for diabetes products in the majority of relevant countries, and is one of two leaders in rapid registration and filing for marketing approval.”

In certain significant areas, however, progress by pharmaceutical companies has been static at best. For instance, “Commitment to ethical behavior does not correlate with performance,” according to the Index. While all 20 firms have code of conduct policies in place, “18 were the subject of settlements or fines for corrupt behavior, unethical marketing or breaches of competition law.”

Also, “Companies remain conservative in their disclosure of where patents are active and when they will expire – information that is very useful to medicine procurers and generic medicine manufacturers. No company independently and publicly disclosed patent statuses for products relevant to the Index.”

Before the 2010 Access to Medicine Index was published, a coalition of sustainable investors issued an
Investor Statement, according to which the signatories—which manage a cumulative $5 trillion in assets—commit to accounting for “the analysis generated from the Index as appropriate in the ESG (environmental, social, and corporate governance) analysis we conduct on the companies we invest in.”

In response to the 2014 Index, Lauren Compere of signatory Boston Common Asset Management stated, “We are encouraged by the findings of the 2014 ATMI highlighting that more companies are focusing on innovative access-oriented business models in critical geographies such as GSK’s work in Africa. We are further encouraged that almost half of the access strategies are focused on diseases such as lower respiratory infections, diabetes and hepatitis that are increasingly impacting the developing world.”

“However,” Compere continued, “We clearly need to see greater advances in the institution of, and compliance with, codes of conduct that will guard against incidents of bribery, corruption, and unethical marketing that have resulted in expensive settlements and fines for so many companies.”

Cathy Rowan of the Maryknoll Sisters, like Boston Common a member of the Interfaith Center on Corporate Responsibility (ICCR), stated, “As faith-based investors, we believe pharmaceutical companies have a moral obligation and a social contract to assist the global community in responding to global health needs.”

On December 8th, ICCR members will conduct an investor briefing on the 2014 Access to Medicine Index Published.

Next: Domestic reports call into question the ethics of drug pricing and trials in the pharmaceutical industry.


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