The deceptive marketing practices of Purdue and Johnson & Johnson destroyed thousands and thousands of lives via their complicity in the opioid crisis. Pfizer was forced to settle at $2.3 billion for illegal marketing and skirting safety regulations involving the painkiller Bextra. Big pharma is notorious for its nefarious practices — and of course, they are often therefore involved in health settlements for their victims. The question becomes, what is the optimal mechanism by which to ameliorate the harms they have incurred upon consumers? Direct payouts? Or structural adjustment policies?
The best example of immediate compensation paid to victims is that of the Vioxx settlement. The increased propensity of heart attacks and strokes caused by the painkiller saw upwards of $4 billion given to victims themselves. There are a variety of very intuitive reasons why this is considered a good solution to the symptoms of a health crisis. First and foremost, it is argued to be the most morally correct means of correcting the past wrong. The people who most directly experienced the effects of the health crisis are those who were misled and consumed from pharmaceutical companies, and they are deserving of some form of redress. Cash is also said to be the method of compensation that gives direct victims the most freedom — they may spend it however they see fit. Given that health companies stole autonomy away from them — through misleading advertising, drug addiction, etc. — they, in turn, deserve a payout which will restore that missing agency. It is only fair.
Furthermore, in comparison to structural adjustment (policies that seek to help protect everyone in society from health crises into the future), money may be better at mitigating the effects of the situation. The nature of structural adjustment is that it is broad based; it seeks to maximize utility for everybody with what is most generally agreeable. It does not, however, do a good job at accommodating individual circumstances. Not everyone’s most proximate need after an opioid addiction is access to a rehabilitation center. Many may be hurt more by the economic consequences of losing your job in face of drug addiction, and require money to buy food and basic necessities. Money has the power to tailor to each and every one of those individual necessities, while structural adjustment inevitably will not fit the problems of all.
However, that is only one side of the discussion. The primary concern with individual payout is that it only ever benefits the most direct of victims in a health crisis. Most certainly, these are individuals that deserve some form of justice, but why should indirect and future victims be excluded? The nature of structural adjustment is that it is more accommodating to the necessities of those who were perhaps not direct consumers from nasty big pharma, but nonetheless experienced the effects of the crisis. When your community is hit with an opioid crisis, investment dries up, business tanks, and everyone else around those who are afflicted by addiction also suffer. Why should these people not benefit from the conclusion of a settlement? Funding more medical research helps everybody, as does building health facilities which double as rehabilitation centers. Moreover, these solutions are much more long term. When cash is spent by victims, it cannot be spent again by victims into the future, or by indirect victims. A rehabilitation center, however, is not going anywhere. These are still goods that can be enjoyed by direct victims, but they have the added utility of helping everyone else in the process.
Of course, there is a tradeoff to be made. Rehabilitation centers for an entire community will not help an opioid addict as much as money which allows them to buy private therapy. How do we weigh up utility and groups in this way?
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