Forest Labs Case Analysis - Essay Example

The antidepressant Celexa caused Forest-Labs to become a very fast-growing company in the United States. The net profits earned through the sales of Celexa were used by Solomon for the expansion of the company; he licensed several other drugs from pharmaceutical companies in Europe. However, Solomon has been accused of excessive marketing and the expansion of Forest is deemed as dangerous for other companies. Also, the profits made by Forest Labs over such a short period are unreasonably high. The previous year Solomon earned $8.3 million as the CEO of the company.

However, it was found out that the Marketing Department had been marketing the earlier named antidepressants to adolescents and children, and that too illegally, although these drugs are not suitable for them. Hence, the Obama Administration decided to oust Howard Solomon from doing further business. Solomon agreed to pay a fine of $313 million for resolving the issue (Hooper and Henderson).

In my opinion, the decision taken by the Government was ethical. This is because several pharmaceutical companies have been alleged of conducting business unethically in the past, but none of the charges or penalties levied against them seemed to have a deterrent effect on their business. Ousting a company's CEO for conducting such activities should bring out the desired effect as he would make efforts to correct the malpractices prevalent in his company.

There is always a counterargument which states that only ousting a CEO would not prevent the company from putting an end to its illegitimate practices; one should rather take serious action against the entire marketing department which can directly be blamed for the offence. But, being the CEO of the company, the Government has full rights to hold Howard Solomon accountable for all the malpractices going on within his company. The company shall also be fined a very heavy sum which is equivalent to the amount of sales made during the period of illegal marketing. But, I believe, the Government is justified in taking the step it took as it would serve as a starting ground and other CEOs whose companies are also indulged in such activities would learn lessons from it and would take action to stop any objectionable activities within them. By taking this decision, the Government is trying to send a message to the entire industry which, hopefully, would be heard by them. Also, there is a certain provision in the Federal Law that legitimizes the exclusion of an individual who has not been alleged of a crime. Hence, this action of the Government is in coherence with the American Law and thus, the Government cannot be questioned.

By concealing a negative case study about Celexa and by pushing sales representatives to pay illegal kickbacks to paediatricians, the senior executives of Forest Labs indeed proved to be highly culpable (Singer).

Antidepressants can be highly lethal for adolescents and children. It is a belief that this is a cause of suicidal behaviour in children and mental illnesses. This fact has been verified by the Food and Drug Administration (FDA). Among the various side effects that children experience due to such medications, the common ones are feelings of sedation and weight gain, whilst some children may feel more energized with the intake of antidepressants. In short, antidepressants cause psychotic problems in children which are very harmful. Hence, I believe that the government is right in barring Howard Solomon as his company was engaged in a very unethical activity which was dangerous for society as a whole. Antidepressants are not something for children and by marketing the product to children, the company motivated them to harm themselves which is very wrong from an ethical standpoint.

The case of Forest Labs implies that although companies have been indulged in far more despicable crimes in the past, new, more severe actions need to be taken against those companies that go against the rules and regulations placed by the Government. The fact that other companies also conduct malpractices does not bereave Forest Labs from being accountable for its actions.

Violation of Health Care Laws is an illegitimate act in itself and should not be pardoned. Therefore, it comes under very serious crimes. Since the Proxy statement of the company itself states that Howard has a detailed knowledge of all the activities taking place within his company, he should be rightly punished.