Due Fr Chapter 01 Discussion After reading the Case Study on Merck & Co., Inc., discuss your opinion on whether or not management made the right decision to use stakeholder funds on a product that would not have a positive return on investment, Write a full detailed response to the question listed above, Make sure you take the time to answer completely business ethics and some of the issues it raises and con- tinue by examining moral reasoning, moral decision mak- Ing, and moral responsibility 1.1: The Nature of Business Ethics OBJECTIVE: Analyze the basic nature of business ethics The best way to introduce a discussion of business ethics is by looking at how real companies have or have not- incorporated ethics into operations. Consider how Merck & Co., Inc., a U.S. drug company, dealt with the issue of river blindness. 1.1.1: Merck & Co., Inc. River blindness, or onchocerciasis, is a debilitating para- sitic disease. It affects about 17 million impoverished peo ple living in remote villages along the banks of rivers in tropical regions of Africa and Latin America. The discase is endemic in 30 African countries, 6 Latin American countries, and Yemen. River blindness is caused by a tiny parasitic worm that is passed from person to person by the bite of the black fly, which breeds in fast-flowing river waters. The tiny worms burrow under a person's skin, where they grow as long as 2 feet curled up in colonies inside ugly round nodules half an inch to an inch in diam- eter. Male worms move between the colonies to mate with the females. After mating, the female worms each day release thousands of microscopic offspring called microfi- larine. These tiny worms wriggle their way throughout the body moving beneath the skin, discoloring it as they migrate. The worms cause lesions on the skin and such intense itching that victims sometimes commit suicide. Eventually, the microfilariae invade the eyes and blind the victim. Toward the end of the twentieth century, in some West African villages, the parasite had blinded more than 60 percent of adults older than 55. The World Health Organization (WHO) reported that the disease had blinded 270,000 people and left another 800,000 with impaired vision. It is estimated that worldwide more than 100 million people were at risk of infection and 37 million people had been infected. Pesticides no longer stop the black fly because it has developed immunity to them. Moreover, until the events described below, the only drugs available to treat the para- site in humans were impractical for the destitute victims who lived in isolated rural villages. The drugs were accepted the nodules, the torturous itching, and eventual blindness as an inescapable part of life. Having looked at how Merck dealt with its discovery of a cure for river blindness, let us now turn to the relation ship between ethics and business. Pundits sometimes quip that the phrase business ethics is a contradiction in terms because there is an inherent conflict between ethics and the pursuit of profit. When ethics conflicts with profits, they imply, businesses always choose profits over ethics. Yet, the case of Merck suggests a different perspective-aper- spective that many companies are increasingly taking Merck's managers spent $200 million developing a prod- uct they knew had little chance of ever being profitable. They did so because they felt they had an ethical obligation to make its potentially great benefits available to people. In this case, at least, a large and very successful business seems to have chosen ethics over profits. Moreover, the comments of Dr. Vagelos at the end of the case suggest that, in the long run, there may be no inherent conflict between ethical behavior and the pursuit of profit. His comments suggest that ethical behavior creates the kind of goodwill and reputation that expand a company's oppor tunities for profit LONG-TERM BUSINESS STRATEGY Not all companies operate like Merck, and Merck itself has made decisions that were not ethical. Many--perhaps most-companies will not invest in a project that will probably be unprofit- able even if it will benefit humanity. Every day newspapers announce the names of companies that choose profits over ethics or that, at least for a time, profited through unethical behavior: Enron, World Com, Global Crossing, Rite Aid, Oracle, Parmor, Adelphia, Arthur Andersen, Louisiana- Pacific, and Owest are but a few of these. In 2004, even Merck was accused of failing to disclose heart problems associated with its drug Vioxx, and in 2010 the company put $4.85 billion into a fund to compensate patients who said they had suffered heart attacks or strokes because they had used Vioxx. In spite of its significant lapse in regard to Vioxx, Merck has remained committed to operate ethically. It has continued to win dozens of awards for its ethically responsible operations. Although many companies engage in unethical behavior, habitually unethical behavior is not necessarily a good long-term business strategy. Ask yourself whether, as a customer, you prefer buying from a business that you know is honest and trustworthy or one with a repu- tation for being dishonest and crooked. As an employee, are you more likely to loyally serve a company that treats you with fairness and respect or one that habitually treats th e cure for over Blindness 10. 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