In 2008, pharmaceutical company Genentech withdrew its psoriasis drug Raptiva from the market because it was linked to a rare but often fatal brain disorder (progressive multifocal leukoencephalopathy) in patients who used the medication.
There were about 2,000 patients in the United States taking the drug. Genentech expected to record an approximate $125 million cost of sales increase for the first half of 2009 for the withdrawal. Genentech was acquired in March 2009 by Roche Holding AG.
a. Find information on the Web about problems in the pharmaceutical industry. Be certain to review Genentech's annual report information related to Raptiva. Discuss your findings.
b. Compare Genentech's 2008 profits with those of other firms in the industry.
c. Discuss why a total quality management system would be more important in pharmaceutical companies than in most other companies.