only few questions to answer from this work
EMERGING MARKETS: The Ebola Challenge First reported in 1976 in Sudan and Zaire (now called the Democratic Republic of the Congo [DRC]), Ebola has been a known virus for four decades. Yet, there is still no effective vaccine or medicine. Between 1976 and 2013, there were 24 outbreaks in Sub-Saharan Africa, with 1,716 cases. What really put Ebola on the center stage of global media was the 2014 outbreak, which was the most devastating outbreak with 15,000 reported cases and 6,000 deaths. Starting in Guinea, Liberia, and Sierra Leone, the disease quickly diffused to other West African countries, such as the DRC, Nigeria, and Senegal. By September 2014, a Liberian man who travelled to Dallas, Texas, was diagnosed to have Ebola. He died in early October. Two American nurses who treated the patient became the first confirmed cases to be infected by Ebola in the United States, triggering panic and chaos not only in Texas but also in other parts of the country. State governments in Connecticut, Illinois, New Jersey, and New York demanded that anyone who travelled from affected West African countries be subject to 21 days of quarantine—the longest period the Ebola virus was thought to need to incubate. In mid-October 2014, President Obama appointed a national Ebola response coordinator. All passengers arriving from affected African countries now had to go through screening, and all patients showing up at a US health care establishment had to answer a questionnaire regarding whether they traveled from these countries. In the absence of effective vaccine or medicine, treatment was indirect. It centered on early supportive care with rehydration and symptomatic treatment. The measures would include management of pain, nausea, fever, and anxiety, as well as rehydration via the oral or by intravenous (IV) route. Blood products such as packed red blood cells, platelets or fresh frozen plasma might also be used. Intensive care was often used in the developed world. This might include maintaining blood volume and electrolytes (salts) balance as well as treating any bacterial infections. Thankfully, the two American nurses recovered after several weeks of treatment, as did the other six American health care workers who went to Africa and came home with Ebola. By December 2014, there had been ten Ebola cases in the United States, and only two resulted in death—the second case of death was an African doctor who was contaminated by his patients in an Ebola-infested country. Throughout the crisis, the initial silence of the pharmaceutical industry was conspicuous. Dr. Margaret Chan, Director-General of the World Health Organization (WHO), criticized the industry for failing to develop a vaccine for Ebola over the four decades during which the virus threatened poor African countries. She complained that “a profit-driven industry does not invest in products for markets that cannot pay.” Initially reluctant, some pharmaceutical firms jumped in. In October 2014, British drugmaker GlaxoSmithKline (GSK) announced that it had expedited its R&D in search of a vaccine. In 2010, the Canadian government developed an experimental vaccine VSV-EBOV and licensed it to a small, virtually unknown biotech firm NewLink Genetics in Ames, Iowa, for clinical trials. However, progress was slow and funding tight. In November 2014, a US giant, Merck, paid NewLink US$50 million to buy the rights to the vaccine and to expedite R&D. Also in November 2014, a French Big Pharma player, Sanofi, announced its intention to work with industry partners to combat Ebola. Another experimental drug ZMapp, developed by a small San Diego, California-based biopharmaceutical firm, Mapp, showed encouraging results on primates, and had been used on at least seven (human) patients in Africa in 2014. But ZMapp had not received FDA approval. In the absence of the financial, technological, and production capabilities of Big Pharma, ZMapp’s stocks quickly ran out. The US government had to provide US$25 million to scale up production. The reason that until recently, pharmaceutical firms—especially Big Pharma firms—had been reluctant to apply their significant resources to find a cure for Ebola was simple. Even if successful, these efforts, which would mostly benefit African countries, would not be profitable. In other words, there was “no compelling business case.” Now that the disease came to the United States (and a few Western European countries), firms felt compelled to move. Debates continued to rage. One side argued that pharmaceutical firms only focused on markets and products from which they could profit—with “Botox, baldness, and bonus” as their guiding light. Tropical diseases such as malaria and Ebola naturally would receive little (or no) attention. Another side argued that given limited resources, pharmaceutical firms rightly and strategically ignored (relatively) smaller-scale diseases such as Ebola, because there were other diseases such as HIV/AIDS that impact a lot more people than Ebola. A number of pharmaceutical firms jumped onto the “Ebola bandwagon” simply to earn CSR kudos, knowing that they would be unlikely to make any profits for their efforts. Or they were simply driven to do so due to public pressure— the series of eager announcements made in October and November 2014 were defensive in nature. Given the long lead time to develop any effective vaccine and the urgency to have a vaccine at hand when confronting an outbreak of Ebola (and other contagious diseases), how pharmaceutical firms manage their quest for the triple bottom line remains one of the leading strategic challenges they have to overcome. CASE DISCUSSION QUESTIONS 1. Dr. Margaret Chan, Director- General of the WHO, criticized the pharmaceutical industry for being “profit-driven” and for failing to invest in the development of a vaccine or cure for Ebola. As CEO of a leading pharmaceutical firm, how do you respond to these criticisms? 2. As a shareholder of a pharmaceutical firm that announced its new investment to develop an Ebola vaccine and that as a result, your dividend would be reduced, would you support or not support the firm’s decision to spend your money to combat Ebola? 3. As a US government official, what would be your recommendations to incentivize pharmaceutical firms to develop an Ebola vaccine? Source: Peng, M. (2017). Global Business 4 Edition (2016), Cengage Learning.