South-Western - Management  
Gifts from Drug Firms Banned at Henry Ford
Topic Ethics and Social Responsibility
Key Words Ethics, gifts
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News Story

Beginning January 1, 2007, the Henry Ford Health System will not allow its doctors to accept free lunches, gifts, and other perks from pharmaceutical representatives. It also will require drug and medical equipment company representatives to be certified by Ford.

Experts at the University of Michigan Health system, which adopted similar guidelines in 2002, say there are clear benefits for patients. These benefits include safer drugs and lower costs. They believe drugs will be safer when physicians don’t accept gifts because free samples often were expired or were not stored properly. Also, doctors who follow the “no-gift” policy tend to prescribe more generic drugs. At U-M, generic drug use has increased from 45% to 58%.

Gifts are very common in the medical field. Drug company promotional expenses for 2002 were estimated at about $21 billion a year, with $6.6 billion of that being used for doctor and hospital gifts and expenses. In one notable example, Dr. Joseph Oesterling, the former chief urologist at U-M convinced the health system’s formulary to prescribe drugs from a company that gave him several million dollars for research. Oesterling resigned in 1997, briefly lost his license and served a short term of community service for his unethical behavior.


The Henry Ford Health System has banned free lunches, gifts, and perks from pharmaceutical representatives for doctors in their system. What was their objective in enacting this new rule? Do you think that they will truly be more effective for patients without the gifts? Do you think other health systems will follow suit?


What is a kickback? How might kickbacks be used in the pharmaceutical drug profession to promote the use of a particular drug?


Pharmaceutical representatives have used free lunches, gifts, and samples as their main form of promotion for years. What are some ethical alternatives to this approach that they can try at the Henry Ford Health System and University of Michigan?

Source “Gifts from Drug Firms Banned at Henry Ford,” Detroit Free Press, Dec. 15, 2006, pNA.
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