Novo Nordisk and Clinical Trials in Emerging Economies

Subject: BUSSINESS ETHICS - BUS 6590

"NOVO NORDISK AND CLINICAL TRIALS IN EMERGING ECONOMIES"

I/. PART 1: CASE GIST

NOVO NORDISK.

Novo Nordisk A/S was born in 1989 through the merger of 2 Danish companies, Novo Industri A/S and Nordisk Gentofte A/S, which were both founded in 1920s and then produced insulin, an important medicine in diabetes treatment. At present, the company has got the biggest and the most novel list of products in the industry including the most modern insulin delivery system. It is also the leader in some areas such as haemostasis management, growth hormone therapy and hormone replacement therapy. The company's revenue in 2007 was DKr41.8 billion (about US$8 billion), DKr30.5 billion in which came from selling diabetes medicine and DKr11.4 billion came from selling biological medicine.

Like other pharmaceutical and medical companies, Novo Nordisk takes priority in investing to develop new medications supporting safe and user friendly disease treatment procedures. The concept of new product development includes introducing new types of medication or changes to the medicinal use.

A new type of medication or medical equipment can only go into the market after being approved by the regulatory authorities - Food and Drug Administration (FDA) in the USA and European Medicine Agency (EMA) of the European Union are some of those - for the hallmarks of safety and efficacy. For such approval, pharmaceutical companies have to be able to provide scientific evidence showing that their products can improve patients' situation and have no serious side effect. The evidence must be based on clinical trials or the tests of the medicine on patients' body.

However, the clinical experimentation in this area presents many ethical issues. Medical experts, non-governmental organizations and the media have accused multinational pharmaceutical companies of carrying out trials in developing countries with less appreciation of ethical principles - often referred as "ethical bribe" - regardless of a number of patients who took trials do not understand or care about the procedures' risks but only want to get free medications and regardless of investigators' incapability.

In 2008, SOMO, a Dutch non-governmental organization alleged some multinational pharmaceutical companies of routinely carrying out trials in developing countries under unethical conditions. Danish National Committee on Biomedical Research Ethics also showed their concerns relating to this issue. As a result, some pharmaceutical companies in Denmark were criticized for their ethics violations during such trials despites against the committee's ethical demands.

On an early spring day of 2008, Anders Dejgaard, chief medical officer (CMO) of Novo Nordisk received a request from a female journalist from Danish newspaper Berlingske Tidende for an interview around Danish companies' intention to offshore their clinical trials to foreign countries. Dejgaard is thinking to find suitable way to respond the journalist's request. Should he meet her face to face? Or should he send a PR officer to the appointment with this journalist? Or should he reply her through email with quotes in the company's website? In case he goes to the interview with the journalist, what would be the major message and how should he prepare for the question might she raise during the interview?

II. PART 2 - ANSWER TO QUESTIONS.

Question 1: Considering both economic and ethical aspects, is it appropriate for companies like Novo Nordisk to conduct clinical trials in, for example, India, and if so under what conditions? What exactly are the principles that should guide such a decision?

Nordisk's clinic experimentation in India is appropriate based on the following principles.

 Economic aspect

* Before the product is approved by the regulatory authorities, Novo Nordisk might need 6 to 8 phase 3 trials on different groups of participants or on different combination of medications, each trial might need 400 to 800 participants. Such trials are often carried out in multinational research, sometimes involving up to 15 countries. Because the demand for experimentation on human subjects to receive approval is increasingly higher, and so is the number of medications that needs tested, the recruitment of participants is becoming a big challenge. Normally, trials carried out in a large number of hospitals must follow a preset testing protocol, ensure the consistency of data and comply with "Good Clinical Practice" (GCP) guidelines. The experimentation on many sites makes it easier to find diversely profiled participants.

* Based on such experimental requirements, it can be seen that countries with large population like India (the world's second largest population of over 1 billion in 2011) with 70% of the population in the rural area are definitely suitable for the clinical trials that require a large number of participants. Hospitals in this country (India) allow physicians to approach a lot of patients who suffer from specific symptoms, and trials can be carried out at lower costs (usually only half of the costs for trials applied in America and Europe). In other words, from economic aspect, implementing clinical trials, particularly in 3rd countries, in high population countries like India is very economically effective since this step of experimentation always costs the most in the overall process of developing new medications and often takes years to be complete.

 Ethical aspect

* NovoNordisk's trials seriously comply with medical ethics (Hippocrates's oath) because the company pays particular attention to individual participants joining any of their trials.

* Novo Nordisk highlights corporate responsibility and takes that part of the corporate image and pursuing a method of 3 targets: environmental responsibility, social responsibility and economic developing capability. Accordingly, Novo Nordisk confirms its sustainability is its ability to maintain and develop its business in long term and in harmony with social responsibility.

* Novo Nordisk has applied all guidelines and global standards given by regulatory authorities and even has its own principles for clinical trials. Accordingly:

- Novo Nordisk sponsored clinical trials always comply with Helsinki Announcement, listing rights of the participants and global ethic guidelines such as Nuremberg code, Belmont report and CIOMMS as well as guidelines