Twenty-five years ago, Merck was named by Fortune magazine as the most admired company in America. It was the seventh consecutive year Merck topped the list. It was also the last time a drug company was considered the most admired company. Today it's inconceivable that a drug company would be so honored.
The damage to the reputation of the pharmaceutical industry over the last quarter-century has few if any precedents in American history. Many other industries have vocal, impassioned critics. Banks, energy producers, and industrial manufacturers, for example, are routinely battered by consumer advocates or the media, but they have always been the target of criticism. The pharmaceutical industry was seen in a different light, but now is at the bottom of the public's list of bad actors.
The industry’s cardinal sin, in the eyes of consumers, is the perception that it puts profits over safety. The most common word associated with drug companies is "greed." This perception is reinforced every day in the news and by consumers’ own experiences. If the Trump administration pressures the industry to cut prices, or to cut price increases, this could affect consumer attitudes, but the issues for the industry run deeper than resentment over prices.
The decline in the reputation of the drug industry has many roots. Over the last two decades, it has spent tens of billions of dollars on direct-to-consumer advertisements. In addition to extolling their medications’ intended effects, the ads have informed consumers, ad nauseam, of their potential side effects. Consumers now understand that every medicine has some degree of risk. The subsequent tidal wave of product liability litigation further confirmed the risks.
Despite these concerns and others, public attitudes are not all negative. The industry's commitment to research and development is appreciated and respected. Consumers think drug companies hold a special place in our society, and they want the industry to act accordingly.
The industry rightfully points out all the good it does. The lives saved and enhanced. The billions invested in curing our most frightening diseases. The free or discounted medicine it provides. The global leadership it offers. These are all valid points, but something is missing. The public is looking for more. I have four suggestions.
First, the industry should ban the term "blockbuster" when referring to new, highly successful medications. The term was first applied to Tagamet, an ulcer medication introduced in the U.S. in 1977, earning more than $1 billion for GSK. To Wall Street, the announcement of a blockbuster sounds like success. To the rest of America, "blockbuster" reinforces the view that money matters more than medicine.
Second, drug companies should commit to spending 5% of their direct-to-consumer ad budget to promote wellness rather than to market a product. The industry could pool these funds and engage college students in dozens of universities to develop creative, attention-grabbing campaigns aimed at building awareness of critical health challenges.
Third, the industry should deploy a SWAT team of scientists, doctors, and nurses who can be sent on an emergency basis to the most health-challenged communities in the nation. They could go to the coal fields of Mingo County, West Virginia, to help with the opioid-addiction crisis or to Flint, Michigan, to assist with the water problem. They could create support networks for professionals on the ground. And they could provide free or discounted medicine. Most important, they would bring hope and proof that drug companies are invested in Americans’ health.
Fourth, America's drug companies should announce the nation's largest summer-employment program. They should create 50,000 summer jobs across all 50 states. The jobs would put young people to work while providing communities with talented, motivated workers who can meet their needs. This army of pharma-paid young people could work at nursing homes and hospices or serve as tutors to underprivileged children. In every community, they would be goodwill ambassadors for an industry proving it cares about all of America.
America needs a strong, creative, and efficient pharmaceutical sector. The industry needs public respect and support. Implementing the programs above won’t restore the industry's reputation to the status it enjoyed 25 years ago, but these initiatives would begin to place the drug industry in a new light and heal public attitudes. If bold steps aren't taken to address the public's concerns, the consequences for the drug companies, patients, and the country will be extremely unfortunate.
Dan McGinn is founder and CEO of McGinn and Company.