Kevin Quinley, Contributing Writer05.14.14
In Hollywood’s latest cinematic retelling of the biblical flood (“Noah” starting Russell Crowe), God calls upon Noah and his ark to save selected members of mankind, plus the entire gamut of the animal kingdom. In current times, those who would protect creatures may not build arks but may seek retribution against those they perceive as mistreating animals.
Medical technology firms face risks from animal activists who target such companies. Animals used for testing and trials may include mice, rats, rabbits, dogs or even primates. Activist groups may believe that drug, device or biotech firms use (or abuse) animals in clinical trials and testing. Maybe the “target” firm does not use animals in testing or trials; it is also possible that the firms use animals humanely. Nevertheless, activist animal groups may plan and execute reprisals against medical device firms. Such actions can exact a toll on these organizations, damaging their financial health, reputation and even employee morale.
Here, when we refer to animal activism, we mean an individual or group that opposes use of animals in testing medical devices, vaccines, pharmaceuticals and biologics. Moreover, these individuals or groups go beyond mere opposition. They translate such views into active manifestations, which may range from the legal (boycott) to the illegal (property destruction). Animal activism is not inherently a criminal activity and is not necessarily bad. It exists and is an acknowledged aspect of the “ecosystem” where medical device manufacturers operate. Medical device firms must, however, consider potential risks that their organizations face due to the actions of animal activist individuals or groups.
The U.S. Food and Drug Administration (FDA) website acknowledges that, occasionally, life-sciences firms—including medical device manufacturers—use animals to test drugs, medical devices, vaccines and other biologics. Companies do this for safety purposes. FDA recognizes the use of animals but also supports efforts to reduce animal testing or replace it with alternative methodologies. Where device companies or other firms use animals for testing purposes, the FDA nevertheless mandates that such companies adopt good manufacturing practices.
Nevertheless, some constituencies vehemently oppose using animals in testing medical devices or drugs. Far from viewing animal testing as the gold standard for assessing toxicity, safety, etc., some individuals and organizations see testing as little more than a ritual mass execution of animals. This article’s aim is not to justify or condemn animal testing, either from a scientific, methodological or ethical perspective. Rather, it recognizes the reality that—to bring some medical devices to market—manufacturers may use animals and that such use evokes strong opposition from groups opposed to testing. Further, vehement reactions can threaten medical device firms, perhaps even ones that do not undertake animal testing but are presumed to do so or perceived as engaging in such activity.
Threats to Life-Science Firms
Maybe your company recently has been blamed for a FDA recall or class-action lawsuits tied to alleged device malfunctions, with animal activist groups condemning the CEO personally. There may be no specific threat against executives—no anonymous letters threatening violence—but radical activists may want to confront company leadership, embarrass them or even harm them.
Real or perceived mistreatment of animals in developing drugs and medical devices can evoke strong, even violent reactions. Consider the passions aroused by the dog abuse case involving professional football player Michael Vick.
Here are some examples specific to the life-science sector:
research. Merck had declined to include this proposal in its proxy. PETA alleged that the denial violates federal securities laws and regulations.
Such actions can adversely impact medical device firms in many ways.
These include:
Risk management programs often address more common and expected perils such as workers compensation, fleet auto, product liability, premises slip and falls and fire insurance coverage. Amidst these more garden-variety risks, management teams easily can overlook the need for risk management plans pertaining to threats posed by animal activists and related groups.
Nevertheless, to fix that common blind spot, here are seven risk management tips and strategies:
No one suggests that animal activism risks are at the top of the list perils that medical device companies should address. Nevertheless, proactive management teams should pause to consider their company’s vulnerability to the acts of animal activists and to devise ways to address potential loss.
If the core value of animal activists is empathy for other animals, such groups might consider the compassionate treatment of human animals, including those who make life-saving and life-sustaining medical products.
Kevin Quinley is principal of Quinley Risk Associates, a risk management consulting firm in the Richmond, Va., area. He has more than 25 years of risk management experience with medical device companies. You can reach him at www.kevinquinley.com or at kevin@kevinquinley.com.
Medical technology firms face risks from animal activists who target such companies. Animals used for testing and trials may include mice, rats, rabbits, dogs or even primates. Activist groups may believe that drug, device or biotech firms use (or abuse) animals in clinical trials and testing. Maybe the “target” firm does not use animals in testing or trials; it is also possible that the firms use animals humanely. Nevertheless, activist animal groups may plan and execute reprisals against medical device firms. Such actions can exact a toll on these organizations, damaging their financial health, reputation and even employee morale.
Here, when we refer to animal activism, we mean an individual or group that opposes use of animals in testing medical devices, vaccines, pharmaceuticals and biologics. Moreover, these individuals or groups go beyond mere opposition. They translate such views into active manifestations, which may range from the legal (boycott) to the illegal (property destruction). Animal activism is not inherently a criminal activity and is not necessarily bad. It exists and is an acknowledged aspect of the “ecosystem” where medical device manufacturers operate. Medical device firms must, however, consider potential risks that their organizations face due to the actions of animal activist individuals or groups.
The U.S. Food and Drug Administration (FDA) website acknowledges that, occasionally, life-sciences firms—including medical device manufacturers—use animals to test drugs, medical devices, vaccines and other biologics. Companies do this for safety purposes. FDA recognizes the use of animals but also supports efforts to reduce animal testing or replace it with alternative methodologies. Where device companies or other firms use animals for testing purposes, the FDA nevertheless mandates that such companies adopt good manufacturing practices.
Nevertheless, some constituencies vehemently oppose using animals in testing medical devices or drugs. Far from viewing animal testing as the gold standard for assessing toxicity, safety, etc., some individuals and organizations see testing as little more than a ritual mass execution of animals. This article’s aim is not to justify or condemn animal testing, either from a scientific, methodological or ethical perspective. Rather, it recognizes the reality that—to bring some medical devices to market—manufacturers may use animals and that such use evokes strong opposition from groups opposed to testing. Further, vehement reactions can threaten medical device firms, perhaps even ones that do not undertake animal testing but are presumed to do so or perceived as engaging in such activity.
Threats to Life-Science Firms
Maybe your company recently has been blamed for a FDA recall or class-action lawsuits tied to alleged device malfunctions, with animal activist groups condemning the CEO personally. There may be no specific threat against executives—no anonymous letters threatening violence—but radical activists may want to confront company leadership, embarrass them or even harm them.
Real or perceived mistreatment of animals in developing drugs and medical devices can evoke strong, even violent reactions. Consider the passions aroused by the dog abuse case involving professional football player Michael Vick.
Here are some examples specific to the life-science sector:
- In the United Kingdom, a firebombing was linked to animal activism;
- A spokesman for an organization calling itself the Animal Liberation Front appeared on the TV show “60 Minutes” and said that killing a researcher who “tortures animals for profit” would be morally justified;
- The National Association of Biomedical Research reports 560 occurrences involving animal rights activists since 1981. These include gestures ranging from rabbit theft to vandalism, assault and death threats; and
- The U.S. Federal Bureau of Investigation’s Ten Most Wanted list includes an animal activist who has been indicted for planning to bomb Chiron, a vaccine manufacturer and Shaklee, a manufacturer of vitamins and shampoos.
- Demonstrations at manufacturing or research and development facilities. These can disrupt a firm’s ability to conduct ongoing business. Bad public relations can convey a negative image of the company. Further, employees can become dispirited and suffer low morale from the negativity and stress occasioned by being in the gun sights of an activist group;
- Acts of vandalism against property—both real property and movable property. The cost to replace or repair damaged property can be significant. Plus, adverse economic reverberations flow from loss of use of such property;
- Violent acts against company employees and executives. Company employees are key assets who leave the office at the end of each day. The firm has a vested interest in seeing them return—unharmed—the next morning;
- Boycotts against companies. These can adversely impact a company’s financial health; and
- Off-site demonstrations. These kinds of activities also spawn negative publicity and shape public perceptions about the respective firm.
research. Merck had declined to include this proposal in its proxy. PETA alleged that the denial violates federal securities laws and regulations.
Such actions can adversely impact medical device firms in many ways.
These include:
- Interrupted business operations, including research, development and manufacturing;
- Damaged company reputation from adverse publicity;
- Diminished stock price;
- Lower employee morale;
- Challenges in talent recruitment;
- Interrupted supply chain, if activist groups target firms doing business with the medtech company; and
- Compromised venture capital funding/investment.
Risk management programs often address more common and expected perils such as workers compensation, fleet auto, product liability, premises slip and falls and fire insurance coverage. Amidst these more garden-variety risks, management teams easily can overlook the need for risk management plans pertaining to threats posed by animal activists and related groups.
Nevertheless, to fix that common blind spot, here are seven risk management tips and strategies:
- Beef up your IT. Tune up your corporate security program. Make scenario-planning de rigueur. For example, what will be the company’s response if an animal rights group protests outside the corporate entrance or gate? What is the response if one or more persons from that group breach perimeter security?
- Train employees on responding to such events, such as procedures for exiting an area rapidly.
- Reassess “standard” security procedures and customize them for threat scenarios.
- Conduct periodic simulations to ensure employees are conversant with appropriate responses. Dust off the company’s crisis management plan to see if it addresses scenarios where a crisis erupts due to the actions of animal activists.
- Monitor activities of these groups. Keep an inventory of such organizations. Regularly monitor their websites, which may yield clues about upcoming activities and targets.
- Prepare a cogent media strategy. This can be an ongoing effort, not a one-shot gesture. The strategy should set the record straight about the company’s use of animals in medical development, its steps for humane treatment and the benefits of developing life-saving and life-enriching products and therapies. Medical technology firms cannot afford to ignore the issue, despite the existence of many more pressing problems. The battle for public opinion wages not just in the marketplace and in courtrooms, but also in the media. Companies must dispel any image that they mistreat animals and reinforce the message that using animals in clinical trials serves a greater good of developing therapies that save lives and enhance the quality of life.
- Use insurance to help cushion financial aftershocks of animal activism. Companies can address the threat of damage to real property through property insurance coverage. Check your current insurance policy to see if vandalism is a covered peril. Partner with your insurance agent or broker to discuss this feature and the risk. Also, determine whether the firm has business interruption coverage and if coverage applies even if there has been no physical damage to the insured’s property.
No one suggests that animal activism risks are at the top of the list perils that medical device companies should address. Nevertheless, proactive management teams should pause to consider their company’s vulnerability to the acts of animal activists and to devise ways to address potential loss.
If the core value of animal activists is empathy for other animals, such groups might consider the compassionate treatment of human animals, including those who make life-saving and life-sustaining medical products.
Kevin Quinley is principal of Quinley Risk Associates, a risk management consulting firm in the Richmond, Va., area. He has more than 25 years of risk management experience with medical device companies. You can reach him at www.kevinquinley.com or at kevin@kevinquinley.com.