(As first published in the Stanford Social Innovation Review on November 16, 2012)
The New England Compounding Center meningitis case spotlights the tragic consequences of failed organizational ethics. The news is rife with stories of natural disasters (the tsunami, Haiti, Hurricane Sandy) and human tragedy (cancer, poverty). These problems are beyond our control despite best practices and best efforts. The news is also rife with silence. Silent rapes in India, decades of hidden abuse by knighted BBC star Jimmy Savile, and the surreptitious collection of user data by the ubiquitous Angry Birds app all demonstrate this. But the 32 deaths from meningitis that were recently traced to the New England Compounding Center (NECC, a pharmacy producing contaminated vaccines) reflect neither disaster beyond human control nor silence. This tragedy reflects blatant disregard for best practices—ones well within the NECC’s control—and a shocking, on-going failure to react to clear danger. It is a tragedy of failed organizational ethics. At the early stages of investigation, and without pre-judging any relevant parties or delving into medical matters, already several organizational ethics lessons surface.
The list of “loud” indicators pointing to trouble, according to a recent New York Times article, is staggering: Bacteria “exceeded the company’s own environmental health limits”; the NECC failed to maintain lab air-conditioning during night hours, despite clear temperature and humidity indicators for safety; a nearby recycling plant owned by one of the owners of the pharmacy failed to comply with regulations (it recycled 16,000 tons of mattress, plastics, and other materials annually); rooms were contaminated with amounts of bacteria and mold exceeding remedial action thresholds (from the company’s own 2012 testing) with “no evidence of remedial action”; neighbors complained of odors and debris; and medical equipment underwent insufficient testing (only one sample allegedly compared to the FDA’s finding of 50 out of 50 contaminated vials from the same lot). The NECC allegedly ignored all of these straightforward matters. How difficult is it to leave the air-conditioner on? Shouldn’t the public expect a pharmaceutical lab to test appropriate samples? Why wasn’t the blatant financial and cross-ownership conflict of interest scrutinized? There is certainly nothing in this mix of failed oversight that falls into the category of uncontrollable natural disaster or silence. The ethical lessons here are relevant to all for-profit and nonprofit organizations, irrespective of their core business or activity. Whether or not they produce human health related products, all organizations affect health and well-being through ethics oversight. First, comprehensive, dynamic risk management is essential. Any one of the issues mentioned in the meningitis case should be an ordinary course risk analysis item for responsible organizations, and should require continuing oversight and transparency. Any one of the issues listed above should trigger immediate investigation and perhaps temporary plant closure. The combination—most egregiously, the culture of repeated disregard for the most basic safety procedures and complaints—has resulted in avoidable tragedy. Second, reliance on regulation is insufficient. The same New York Times article mentioned above cites one senior hospital official (a customer of the NECC) as relying on regulation to indicate whether the company was following best practices. But regulation is always the lowest common denominator and never best practice in all areas, including ethics and safety. Even when regulation functions at its best—that is, when there is full regulatory coverage of all relevant matters, diligent application of regulations, and timely enforcement—organizations cannot assume optimal regulatory context. There are many reasons why regulation may not adequately protect (for example, due to resource limitations, good faith human error, an inability to keep pace with scientific and technological developments, or a lack of clarity in the definition of a key term such as “compounding,” which is possibly the case here). Proper ethics oversight requires that organizations adopt a paradigm of proactive safety and ethics above and beyond the law. Irrespective of potential regulatory weakness, experts cited in this case insist that “the pharmacy knew about the contamination and did nothing.” Third, and perhaps most importantly the NECC’s limited response of following the “existing regulatory process … after adequate time for review” isn’t good enough. It is appalling. The NECC “voluntarily surrendered their license to operate” “at the request of the Massachusetts Department of Public Health,” pending investigation. However, even after tragedy struck, the NECC failed to act independently, swiftly, decisively, and self-critically with one key objective in mind: prevention of further disaster. There is tremendous on-going risk to human life: Approximately 14,000 people have been exposed to contaminants, 461 are ill, and 32 have died. These victims don’t have “adequate time” for a review. This week, further press updates emphasize that the full range of tragic health consequences is still unravelling, many potentially long-term and unexpected. Whatever the outcome of the investigation, the company’s lack of responsiveness and compassion is a failure of organizational ethics. Fourth, reputation is a dynamic process that must be earned every day; it is not a static state of success. Accordingly, reliance on reputation never suffices. In-depth, on-going due diligence is essential. A few highly reputable hospitals purchasing vaccines from the NECC apparently did run occasional checks. My objective is not to judge those institutions or tread into medical/pharmaceutical areas beyond my expertise, but rather to highlight the responsibility of intermediaries in all industries for continuing, independent verification. Supply checks should factor into risk management irrespective of supplier reputation, especially when the nonexpert end user (in this case, the patient) relies so heavily on the intermediary. Finally, ignoring complaints is never justifiable. The NECC should learn from the Savile victims and Angry Birds users. Organizations must listen to neighbors, employees, and anyone else who has potentially pertinent information. In this case, the very existence of a recycling plant with alleged past compliance violations within approximately 100 feet of the pharmacy’s air-conditioner system needs no words. There is no silence here. But the NECC’s effort to remain silent continues at the time of publication of this blog. Congressional hearings are now underway to investigate potential regulatory weaknesses in overseeing compounders such as the NECC. This week’s New York Times states that the Chief Pharmacist and one of the “principal owners“ invoked his Fifth Amendment right to remain silent in response to every question posed to him during the hearing, notwithstanding the aforementioned on-going tragic health developments. We often feel overwhelmed by tragedy beyond human control and institutional silence. This case reminds us of the potentially tragic consequences of failed organizational ethics when the problem falls squarely within human control, and when verbal and nonverbal alarms are ignored.
© Copyright 2012 Susan Liautaud & Associates Limited. All rights reserved.