Over recent years, many pharmaceutical companies have taken up environmental, social and governance (ESG) targets in order to prioritize sustainability whilst boosting their external public relations. On October 6, in a GlobalData webinar, experts tried to answer the question ‘Is Pharma at an ESG turning point?’, revealing a multitude of diverse strategies for pharmaceutical companies to remain conscious of their global impact.
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While there is significant interest among pharma companies to improve their environmental record and reduce their carbon footprint, and rightfully so, the “social” and “governance” aspects are often neglected. Experts at the recent webinar presented health equity data, showing the opportunities to achieve significant financial gain whilst reducing health inequity.
A survey in GlobalData’s Healthcare Industry Business Confidence Report 2020 placed sustainability initiatives at the bottom of a list of the pharmaceutical sector’s main priorities. At the time, pharmaceutical professionals placed “customer retention”, “improving operational market share” and “improving social responsibility initiatives” as the most important priorities for their businesses. However, in GlobalData’s 2021 Global Management Insight Survey, 58.4% of respondents said “Yes” to the question “Do you think the Covid-19 pandemic has acted as a catalyst for increased focus and action on ESG issues?”, showing a potential shift in pharmaceutical perspectives towards sustainability.
Companies such as Merck and Takeda have led the way with goals to reduce their environmental impacts by reducing greenhouse gas emissions, water consumption, and more. These actions, amongst others, aim to meet the goals of the United Nations Climate Change Conference COP21 Paris agreement.
Reaching social and governance goals
In a discussion of the possible social and governance goals, GlobalData’s executive director of Life Sciences Consulting, Tim Dall, highlighted the importance of overcoming healthcare disparities. Dall talked about GlobalData’s partnership with the trade organisation Pharmaceutical Research and Manufacturers of America (PhRMA), which has allowed for a focused effort to analyse and tackle health equity issues within the United States (US).
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By GlobalDataIn recent years, there has been an increasing awareness of how racial disparities affect several sectors including the pharmaceutical industry. Major inequities are seen in drug development, hospital treatment, and insurance coverage. In 2020, PhRMA announced its industry-wide Racial Justice Principles on clinical trial diversity to help Black and brown communities by reducing barriers to clinical trial access, incorporating real-world data, and enhancing information about diversity and inclusion in clinical trial populations. These principles also aim to allow an acknowledgement of Black and brown mistrust of clinical trials.
Such work and initiatives are meant to meet the Centers for Disease Control and Prevention’s (CDC) national goals to “achieve health equity by eliminating health disparities and achieving optimal health for all Americans.” Data presented at the ESG webinar suggested that Americans could benefit from significant financial gain if health equity were prioritized. Discussing the possible ease of a pivot towards health equity Dall said, “There are existing policy changes that could be made easily without major legislations to improve access to medication and adherence”.
Health disparities today
US health disparities have been analysed annually by the US Agency for Healthcare Research and Quality for the last 19 years. In the most recent 2021 report, data showed that 43% of Black people and 36% of Hispanic people received worse quality of care compared to white people in the US. Research presented at GlobalData’s webinar supported this data.
An area of focus in the webinar was medication adherence which remained significantly below 100% across all ethnic groups. However, Dall highlighted disparities between the groups saying, “The white and Asian population tended to do much better in terms of medication adherence, compared to the Black and Hispanic populations.” This trend continued in data presented surrounding the control of chronic diseases. For example, 37% of Black patients’ high blood pressure was “not well managed” with the Hispanic population following closely behind at 34%, compared to 30% of white patients falling under this category.
An analysis from GlobalData showed that achieving health outcomes for chronic diseases for all ethnic backgrounds would be massively beneficial, potentially saving Americans over $3.8 trillion in savings over the next decade. This is due to the $1 trillion in savings from reduced absenteeism and $2.7 trillion saved in medical spending on different treatments and therapies. “There’s an important role for the pharma industry and pharmaceuticals in closing health gaps, but it’s not just in helping minority populations have outcomes that are more similar to the non-Hispanic white population, but rather raising the outcomes for all populations because all populations are performing at less-than-optimal conditions,” said Dall.
PhrMA’s health equity initiative
As of April 2021, PhrMA’s Racial Justice principles were put into effect to reduce health disparities. Courtney Christian, senior director of Policy and Research at PhRMA, explains that in 2020, the murder of George Floyd acted as a turning point for the trade organisation to take further action about reducing healthcare disparities and supporting Black and brown communities. “All of our over 30 companies have committed to doing something over health equity for some time,” said Christian.
“We’ve been learning from communities and having our ear to the ground to really be messengers around the different policies we can promote around health equity, but also support the community-based organisations that are already doing this work,” said Dr. Jackie McRae, director of Policy, Research and Membership at PhRMA.
Click here to watch the full webinar.
