Global Policy Forum

The pharmaceutical industry risks becoming the "new tobacco" unless it cleans up its act in developing countries, an influential group of investors has warned.

The global drugs industry must do more to help poor countries facing health crises, according to investors from the US and continental Europe. The group with combined investments totalling £600bn ($940bn) said if the industry did not shape up its reputation would be destroyed and future profits put at risk. The drug business has come under increasing fire from campaigners in recent years over its policies towards the developing world.

Aids drugs

Firms are accused of failing to prioritise cures for diseases prevalent in poor countries while concentrating on lucrative "lifestyle cures" for prosperous ones. Aids has been the industry's particular bugbear, since most sufferers live in the developing world and many developing countries face social and economic meltdown unless their population can be treated.

Yet, the activists say, the industry has conspired - with the help of the US government - to prevent countries from using their rights under world trade rules to declare public health emergencies and either buy the drugs cheaply or make their own versions. The group of investors, though, was at pains to stress that their decision to write to leading drugmakers was mostly about protecting their investments from the effect of public health crises.

'Already helping'

"While there were clearly very important humanitarian issues, the statement came from a concern about the impact on shareholder value in the long term," said Olivia Lankester, a senior analyst at Isis Asset Management. A spokesman for the Association of the British Pharmaceuticals Industry said its members were already working flat out to help poor countries deal with health emergencies.

"It is not just something that is within the province of the industry to solve," he said. "We can only contribute towards a solution, we can't provide the whole solution."

FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Policy Forum distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.