This Pharmaceutical CEO Just Laid Out The 4 Principles Of Its 'Social Contract' With Shareholders
Brenton Saunders is the CEO and president of Allergan plc Ordinary Shares (NYSE: AGN), and on Tuesday, he clarified what he believes to be the core components of an already existing "social contract" with stakeholders.
In a blog post, Saunders stated he understands the recent public outcry against drug companies that have implemented dramatic price increases. However, he suggested the number of companies engaged in this practice are "outliers" and managed to shift attention away from the industry's "increasingly vibrant medical innovation ecosystem," which actually lowers the overall cost of diseases.
"That drug discovery and development ecosystem is made up of good people working in companies, big and small, who want to do good for others," Saunders wrote. "In fact, all the people I know in the biopharma industry come to work because they have a dream of helping people."
The executive added that a social contract has existed for some time between the healthcare industry and patients, physicians, policy makers and the public at large. Meanwhile, several companies have violated the social contract through predatory pricing. Now is the time to take action.
Saunders went on to detail his belief that the social contract consists of four key components:
- Invest And Innovate: Allergan commits to risking billions of dollars to develop potential life-enhancing innovation.
- Access And Pricing: Providing treatments to patients is "not a straightforward exercise," but Allergan is committed to working with decision makers and intermediaries to make its products as accessible as possible. This includes offering discounts whenever possible.
- Quality And Safety: Allergan has a commitment to monitoring the safety of its products before they are approved and after. This includes promptly reporting and acting on any new data to maintain a high standard of quality for each product.
- Education: Allergan believes in the importance of educating physicians about its medicines so they can better use the products whenever appropriate to do so.
"Allergan commits to this social contract and I encourage others to formulate their own self-policing actions," Saunders concluded. "It is good for Allergan, and it is also vital for our most important constituents — the medical professionals and patients who count on us to continue finding new treatments for their most pressing medical needs."
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