June 16, 2008
U.S. Drugmakers Lacking In Providing Medicine For Poor
A new analysis released today shows U.S. drugmakers are lagging behind their European counterparts in making sure medicines reach those in poor countries. The first of its kind ranking included Britain's GlaxoSmithKline Plc at the top of the list.
The Dutch-based Access to Medicine Foundation produced the analysis, with the backing of 12 fund managers, including AMP, F&C, Morley, Sarasin, Henderson and Schroders, who together manage $1.2 trillion in assets.
The ranking focuses around eight central criteria, including patenting, policies on increasing access, research into neglected diseases and the implementation of fair pricing systems.
The analysis discovered significant differences between the large pharmaceutical companies regarding their efforts to provide millions of people in poor countries with affordable vaccines and drugs.
Diabetes care specialist Novo Nordisk, based in Denmark, ranked second on the list, with Merck & Co Inc, the only U.S. company among the top seven, ranking third. Pfizer Inc, the world's largest pharmaceutical company, ranked 17th out of 20, behind Indian firms Ranbaxy Laboratories Ltd and Cipla Ltd. No Japanese companies made the list.
Access to Medicine Foundation chief Wim Leereveld said the index provides investors a new way to assess companies' social responsibility, and may prompt those ranking low or not included on the list into action. Leereveld believes the gap between European and U.S. companies is largely cultural.
"Europe is closer to Africa and has deeper relations with Africa. But it is also clear from issues like carbon emissions and climate change that there is something of a transatlantic divide on corporate social responsibility issues," he said in an interview with Reuters.
Some long-term investors worry the drugmakers might suffer damage to their reputations if they fail to ensure access to medicines in the world's poorest nations.
"For investors, how the pharmaceutical industry responds to the access to medicine issue could impact materially on long-term shareholder value," the fund managers supporting the ranking wrote in a statement.
"There is, therefore, a need for tools which help investors and analysts assess the long-term investment value of such companies."
The analysis rated the drugmakers as follows:
- GlaxoSmithKline PLC
- Novo Nordisk A/S
- Merck & Company Inc
- Novartis AG
- AstraZenica PLC
- Roche Holdings Limited
- Johnson & Johnson
- Bayer Schering Pharma AG
- Eli Lilly & Company
- Bristol-Myers Squibb Comp
- Abbott Laboratories Ltd
- Merck Kgaa AG
- Cipla Limited
- Gilead Sciences Inc
- Ranbaxy Laboratories Ltd
- Pfizer Inc
- Teva Pharmaceutical Ind. Ltd
- Schering-Plough Corp