What We Can Learn from Anti-corruption and Prevention of Conflict of Interest in the Life Sciences Industry?
Transparency International UK has identified several risk factors linked to corruption, to which the life sciences industry is particularly exposed.
This industry is challenged by the increasing importance of R&D investments that make the temptation even greater to spend money on physicians to influence their prescriptions. Moreover, the privileged relationship between reps and healthcare professionals present opportunities for conflicts of interest and corruption.
Is the risk worth the tarnished reputation of companies when we think about the recent scandals that have transpired?
For this reason several countries (USA, EU, AUS, JPN, etc.) have implemented transparency rules for the public disclosure of transfers of value in this industry. The Pharmaceutical Industry is one of the first industries to disclose all financial transactions with stakeholders to the public.
What can we learn from transparency, anti-corruption and conflict of interest policies in the pharmaceutical industry?
First, that it is important to track all financial transactions between “clients” and stakeholders in order to make this information publicly available. The disclosure of this type of information leads to better financial structures within businesses and to the definition of Fair Market Values.
Second, that there is a need for transparency both at local and at global levels for companies operating in global markets. Anti-corruption and conflict of interest policies must reflect the context of the local business environment and local corruption challenges.
Third, that it is necessary to implement internal approval systems for any financial interaction between clients and suppliers. It is essential that these processes cover the entire cycle ranging from an expenditure request through to the completion and tracking of all transactions.
Finally, the implementation of such processes allows for the collection and analysis of a large amount of information that should be used to generate quality indicators and alerts to identify potentially risky situations.
The implementation of these measures requires a strong effort from companies and require global businesses to cooperate and communicate at all levels. This highlights the issue of homogenizing IT systems within the different entities of a company as well as with external partners. On top of this, the implementation of a transparency system requires an in depth knowledge of local contexts and regulations.
Reinforced anti-corruption policies such as public disclosure of transfer of values should be extended to industries dealing with public health as well as industries where public funds are in play. This being said, the standards for corruption prevention may vary depending on the type of activity.