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Pharma firms draw flak for failing in social duties

January 03, 2008 02:08 IST

Non governmental organisations, dealing with public health, are pointing fingers at pharma companies for not doing enough on the corporate social responsibility front.

Karmayog, a leading NGO which recently carried out a CSR rating of top 500 Indian companies, says that only two drug companies - Dr Reddy's and Lupin - have done work on this front.

While the two firms scored three out of five, 30 other drug firms failed to perform satisfactorily. Nine of the companies, including leading ones such as Nicholas Piramal, Panacea and Glenmark did not score at all. Aventis Pharma was the only company that had CSR programmes for its employees.

The silver lining is the fact that a majority of leading Indian pharmaceutical firms have begun CSR programmes, though not in a big way. Over 60 per cent, or 21 of the drug firms, had initiated programmes in the field of health support, education, environment, community development and health awareness.

Ajit Dangi, director general of the Organisation of Pharmaceutical Producers of India, differed with the NGO's observations.

"The OPPI members have been participating in CSR programmes for years now. Be it natural calamities or diseases such as HIV/AIDS, leprosy or malaria, our members are always in the forefront." Dangi said.

The organisation and S P Jain Institute of Management and Research had, in 2005, brought out a report on CSR initiatives in the pharmaceutical industry, he added.

Interestingly, it is not the Indian drug firms alone that have come under criticism. Oxfam, in a recent global report, said that multinational pharma giants looking to expand in developing nations need to be more socially responsible.

The NGO rates the social responsibility of multinational pharmaceutical firms on basis of their pricing practices, research and development priorities and intellectual property management in developing nations.

Oxfam argues that while governments have the primary responsibility for providing access to health care, the role of the pharmaceutical industry in providing a vital element - medicines - is crucial.

The NGO believes that the pharmaceutical companies can contribute substantially and effectively towards increasing the access to medicines in developing countries.

"The companies' pursuit of strategies that address access to medicines merely as a  reputational problem has resulted in patchy and ad-hoc approaches which have failed to deliver sustainable solutions. The industry's responses to flagging financial performance - hiking up prices, aggressively defending patents and prolonging existing ones through 'ever-greening' have undermined the need for lower prices, flexible approaches to patenting and R&D investments into diseases relevant to the developing world." Oxfam pointed out.

According to Rohit Malpani, trade policy advisor, Oxfam America, the NGO will partner with Indian public interest groups to make the investor community aware of the responsibilities that should be taken up by the drug industry in facilitating public health.

Joe C Mathew in New Delhi
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