Whistle-Blowers

Frank Honigsbaum

  • Roche versus Adams by Stanley Adams
    Cape, 236 pp, £8.95, January 1984, ISBN 0 224 02180 X
  • Prescriptions for Death: The Drugging of the Third World by Milton Silverman, Philip Lee and Mia Lydecker
    California, 186 pp, £13.55, November 1982, ISBN 0 520 04721 4
  • The Pharmaceutical Industry and Dependency in the Third World by Gary Gereffi
    Princeton, 291 pp, £21.60, November 1983, ISBN 0 691 07645 6
  • Corporate Crime in the Pharmaceutical Industry by John Braithwaite
    Routledge, 440 pp, £25.00, March 1984, ISBN 0 7102 0049 8

The pharmaceutical industry arouses conflicting emotions. Anti-vivisectionists, fringe medical practitioners and food faddists all tend to hate it, while the rest of us are periodically alarmed by the drug disasters that occur and the extent of drug-induced disease. The commercial practices of the industry also provoke concern: complaints arise continuously about price-gouging, market-rigging, profiteering, tax avoidance, misleading advertising claims and a whole host of unsavoury promotional techniques. Against these charges must be set the immense benefits wrought by the succession of wonder drugs that have appeared since prontosil (the forerunner of penicillin) ushered in the antibiotic revolution in 1935. The world would be a sicker and more dangerous place if the industry did not exist. Life expectancy would everywhere be shorter and far more people would be in pain. There is no doubt that on balance drug firms do more good – indeed, far more good – than harm. It is important to keep this in mind when considering these four books, all of which show the industry in dire need of reform.

Stanley Adams is an Oxford graduate of Maltese descent who, following sudden imprisonment, lost his wife, his earning power and nearly all his material possessions. He now lives on supplementary benefit in a small London flat, with the rent paid by the Borough of Camden. His downfall began in Basle in 1973. Adams was then working for Hoffmann-La Roche, the giant multinational drug firm which dominates the vitamin trade and is best known for the two most widely prescribed tranquillisers, Valium and Librium. Adams had been with the firm for ten years and had always been treated well, but he had become alarmed by Roche’s trading practices and reported them to the European Commission. Switzerland had just concluded a Free Trade Agreement with the Common Market, and this meant that the country would henceforth be bound by the EEC’s rules of competition. Although Switzerland itself had competition laws, Adams felt it was pointless to resort to them because of Roche’s immense influence in the country.

The Article in the Treaty of Rome which dealt with this subject was vaguely worded – it merely forbade any firm to ‘abuse a dominant position’ in the market – and had never been tested. Adams was the guinea pig that enabled the Commission to see how far it could go. Clearly, it did not think it could go very far, given that the most important charges made by Adams were not taken up at all. These dealt with price-fixing and production agreements which, Adams alleged, Roche had made with other firms in order to secure its domination of the vitamin market. Though Adams was able to provide inside knowledge, the Commission did not feel his evidence was sufficient to make the charges stick. All it did was proceed with the lesser charge which Adams had added almost as an after-thought. This dealt with fidelity contracts – an arrangement designed to ensure that Roche’s principal customers did not trade elsewhere. Eventually, after three years of investigation, the Commission ordered Roche to terminate these contracts, but it imposed only a £240,000 fine, an amount which represented less than 1 per cent of Roche’s turnover when a 10 per cent penalty could have been applied. And even that derisory sum was reduced to £150,000 three years later when the European Court of Justice upheld the Commission’s action.

For Roche, the affair was over: Adams’s difficulties had only just begun. Without knowing it, he had violated the Swiss secrecy law by disclosing Roche’s practices to the EEC, and he was arrested on 1 January 1975, as he crossed the Swiss border. (He had by then left Roche and moved to Italy to start a pig farm.) The events that follow almost defy belief. Shocked by his arrest and fearing that her husband faced prolonged imprisonment, Adams’s wife committed suicide, leaving him with three young daughters to raise. Since the right of habeas corpus does not exist in Switzerland, Adams was held for three months before trial and was not even allowed to attend his wife’s funeral. Though subsequently convicted and ordered to pay costs, he received a suspended sentence and was thus able to return to Italy. There, however, he found himself embroiled in a Kafkaesque duel with the Italian bureaucracy in an attempt to rescue the funds he had been promised to start his industrial pig farm. The effort failed, and by 1980, Adams was faced with a crushing burden of debt which threatened to expose him to further imprisonment. To escape that, he fled to Britain. He has remained here ever since, trying, with the assistance of a widely-based appeal committee, to clear his name and secure just compensation.

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