GlaxoSmithKline have pledged to cut prices of their pharmaceutical products in poor countries, to pump profits back into medical care, and to share details of patented products. This is an amazing development, but frankly, it’s bizarre that no pharma company has done anything like this before.
So why have GSK done it?
- Let’s give them the benefit of the doubt and acknowledge that maybe they’ve done it in part because it’s the right thing to do.
- In the long-run, it might very well be commercially rewarding. When most people think pharma, they think profit-driven behemoths. What a waste, given that it would be so easy for pharma to develop a positive image of itself. After all, it has played a large part in developing the standard of life we all take for granted; it’s an industry that cures diseases, prolongs life expectancy and saves lives. Who else can claim that? By being the first to make this sort of pledge in their industry, GSK are carving out a position for themselves as the “nice guy” of pharma that may very well stick for decades, even once the others have caught up. In an age where people expect companies to be ethical and to give something back, this will mean that plenty of people will pick GSK over their competitors when purchasing a product or making an investment.
- As mentioned in the Guardian article linked to above, the open-source approach would likely improve R&D by allowing the best minds to work on products simultaneously no matter where they work, rather than keeping everything in-house. It’s worked in the software industry, why couldn’t it do so elsewhere? So others might have access to GSK’s trade secrets, but GSK will improve their products and as the “nice guy” of pharma will be most consumers’ brand of choice.
Hats off to GSK, and let’s hope other pharma companies follow suit immediately rather than trying to fight it off for as long as possible. They’d only be postponing the inevitable.