Drugmakers aren't the most admired of companies. Or the most respected, or even the most popular. Face it: If the pharma industry was in high school, it would be sitting alone in a corner of the cafeteria, or, on a good day, hanging out with Big Oil.
Plenty of reasons for that. For instance, the high-profile, multibillion-dollar marketing settlements inked by the likes of GlaxoSmithKline ($GSK), Pfizer ($PFE) and Eli Lilly ($LLY). The high-profile safety scandals and liability lawsuits ranging from Merck's ($MRK) Vioxx to GSK's Avandia to Johnson & Johnson's ($JNJ) Risperdal. The contentious debates over sky-high prices on some key drugs. In fact, the list of reasons is so long that even drugmakers themselves aren't surprised they have an image problem.
According to Eye for Pharma's latest Healthcheck survey of the drug business, 42% of respondents said they don't think pharma's image is getting any better among average folks. More than one-third said they're not sure or neutral on the subject. That leaves a mere 19% in the group of optimists who think pharma's rep is improving.
Thing is, almost half of respondents believe the industry knows what to do to gain standing with the rest of the world--and only 24% think pharma is clueless about how to rehab its reputation. But commentators on the survey results are skeptical that companies are willing to do what it takes--partly because they don't know whether the financial benefit is worth the risk.
Which brings us to another new report, highlighted by Pharmalot. PA Consulting Group took a look at pharma's compliance programs and regulatory action against companies and compared that info with shareholder returns. The gist? Drugmakers that are best at following the rules--and, importantly, really believe in them--tend to deliver a better shareholder return. There's some incentive for the skeptical.