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Case 3: Merck, the FDA, and the Vioxx RecallTEACHING NOTE FOR: MERCK, the FDA, and the VIOXX RECALLThis case illustrates the following themes and concepts discussed in the chapters listed:Theme/ConceptChapterThe Corporation and its Stakeholders 1Public Issues and the Corporation2Corporate Social Responsibility3Ethics 4Global Corporate Citizenship7Government Regulation8Political Influence9Consumer Rights15Case Synopsis:In 2006, the pharmaceutical giant Merck faced major challenges. The company’s best-selling prescription painkiller, Vioxx, which had been taken by more than 80 million people worldwide for five years, had been implicated in deaths from heart attack and stroke. Now, Merck was faced with a chorus of criticism, a sharp decline in its stock value, and thousands of liability lawsuits. The case describes Merck’s development, testing, and marketing of Vioxx, as well as the company’s relationships with regulators and policymakers. It also describes Merck’s decision in September 2004 to recall the drug voluntarily following new evidence of elevated cardiovascular risk. TEACHING TIP: WHERE TO USE THE CASE IN THE COURSEThere are different ways to approach the discussion of this case, depending on where inthe course sequence it is used.1. If used in connection with the topics of corporate social responsibility and ethics andpolitical action by business, it may be used to evaluate Merck’s behavior. In this event, the instructor may wish to focus mainly on questions 1 and 2. 2. If used in connection with the topics of government regulation or consumers as a stakeholder, it may be used to consider the best strategy for government and society to adopt to protect consumers of prescription medicines. In this even, the instructor may wish to focus mainly on questions 3 and 4.3. If used at the end of the course, it may be used as an integrative case. In this event, the instructor may wish to cover both sets of questions. Case 3-1
Case 3: Merck, the FDA, and the Vioxx RecallTEACHING TIP: VIDEOSSeveral videos are available that may be used with this case. They should be ordered atleast two weeks before they will be shown. “Bad Medicine: Vioxx, FDA, and Drug Approval”NOW Hosted by David Brancaccio January 7, 2005 (approx. 20 minutes)Transcript available online at Streaming video (RealTime player required) available online DVD available for $19.99 from . David Brancaccio hosts a segment on Vioxx and the drug approval process. The clip includes footage of Raymond Gilmartin, CEO of Merck, announcing the recall; television advertisements for Vioxx; an interview with a woman whose 34-year old daughter died of a heart attack while taking Vioxx; and an interview with Dr. David Graham, an FDA scientist who had challenged the safety of Vioxx.