Western drugmakers walk ethical tightrope over Russian ties
Western drugmakers are continuing to export life-saving medicines to Russia, citing a moral obligation to patients. But as public outrage over Vladimir Putin’s invasion of Ukraine grows the industry is scaling back its presence in the country and warning sanctions will cause logistical problems that threaten to result in a shortage of drugs.
Pharma is one of the few western industries that can continue to operate in Russia because of a carve-out in the sanctions regime for medicines, food and humanitarian products. But that has thrown up a different set of challenges for companies trying to balance their responsibility to help sick Russians while demonstrating their opposition to the war.
Pfizer told the Financial Times this week it would not make any new investments in contract manufacturing that are not already fully operational, referring to the practice of making drugs for other companies. That will halt a high-profile partnership previously agreed with Russia’s Pharmstandard that was due to begin making innovative cancer treatments in the country by 2024.
GlaxoSmithKline said this week that it would prioritise supplies that are essential to people’s health, following Eli Lilly’s decision to restrict exports of all non-essential medicines — including its treatment for erectile dysfunction Cialis — to Russia. German drug and agrochemical conglomerate Bayer has also threatened to suspend crop sales to Russia next year unless it stops attacking Ukraine.
Almost 900 leaders in the life sciences industry have signed an open letter calling on business to disengage from Russian industry.
Governance experts say companies are walking an ethical tightrope over the types of medicine they export to Russia and whether to maintain local operations and a swath of partnerships agreed with local groups. Those tie-ups were fuelled by a decade-long localisation strategy for pharma pursued by Moscow intended to ensure more drugs were made in the country rather than imported.
Nell Minow, vice-chair of ValueEdge Advisors, a firm that advises investors on corporate governance, said that unless companies “come out with a very clear statement about what their priorities are and what actions they’re taking, they can expect a lot of pushback from employees, investors and even customers”.
But Minow said the safety of employees at pharmaceutical companies, one of the few western industries to remain operating in Russia, should be a priority, with special consideration given to the unique nature of healthcare and the pharmaceutical sectors.
“Pharma is different from, say, McDonald’s. You know, people can live without hamburgers but they can’t live without essential medicines,” she added.
Drugs are usually transported in the hold of passenger planes but, because flights have been stopped, many are now going by land. One drugmaker said its trucks were facing significant delays at the border. The European Federation of Pharmaceutical Industries and Associations said supply was challenging as one of the main overland supply routes via Ukraine was de facto closed.
Lilly’s has gone much further than rivals by ceasing export of non-essential medicines to Russia, dividing opinion among industry participants, academics and human rights advocates.
“The gut reaction when you see the suffering in Ukraine is one of retribution,” said Nick Broughton, a member of the ethics committee at the Faculty of Pharmaceutical Medicine in London. “If hospitals are being bombed and children are being harmed in Ukraine, then what can you do to cause the equivalent harm in Russia?”
“[But] the moral position and the position the west should take is that we do not want to see harm to Russian children, any more than Ukrainian children, Russian people, any more than Ukrainian people,” he added.
Pharmaceutical companies not try to separate “essential medicines” from other drugs, he said.
However, he said, it was important for the industry to stress that it would not benefit from selling drugs in Russia and suggested companies donate any profits to Ukraine, an approach adopted by Lilly, Pfizer and GlaxoSmithKline. This would be both moral and a “powerful” public relations move, he added.
But some academics have praised Lilly for making a distinction between essential and non-essential medicines.
“Companies like Lilly make a strong statement in favour of peace and democracy,” said Nancy Jecker, professor of bioethics at the University of Washington School of Medicine in Seattle. “Non-essential medicines are not owed to people as a basic right.”
Lilly said it had defined essential medicines as those that treat serious or life-threatening health conditions, as well as medicines that help children.
Experts warn that regardless of whether western companies try to maintain supplies, Russia is likely to face drug shortages because of transport challenges and its reliance on imports.
A decade-long Kremlin-backed strategy aimed at weaning Russia off a reliance on imported medicines has had limited impact. About 70 per cent of commercial medicines are imported, compared with 76 per cent in 2012, according to a report by Gowling WLG, a law firm.
Koen Berden, executive director for international affairs at the European Federation of Pharmaceutical Industries and Associations, said logistical challenges would be compounded by the devaluation of the rouble, which would raise the cost of foreign medicines for Russia.
Human rights groups warn that sanctions can have a devastating impact on healthcare systems even when medicines are exempted. The re-imposition of sanctions by the US on Iran in 2018 caused “unnecessary suffering” to people suffering from a range of diseases, including those with leukaemia who were no longer able to acquire previously available medicines, according to a report by Human Rights Watch in 2019.
“Excessive caution or ‘overcompliance’ by banks and pharmaceutical companies wary of falling afoul of US sanctions is a significant factor in limiting Iran’s access to funds for imports of medicines and medical equipment,” concluded the report.
Judyth Twigg, a professor at Virginia Commonwealth University specialising in global health, said drug shortages in Russia had occurred before the war in Ukraine because of the government’s attempts to substitute imported drugs with domestic alternatives.
She said the shortages were likely to become more severe because of the sanctions but noted the scale of Russia’s war in Ukraine, which included multiple attacks on medical centres, raised complex ethical questions for pharmaceutical companies.
“There’s a powerful argument that health and healthcare needs transcend politics,” said Twigg. “These are tough questions . . . This is a hard call.”