Master of Business Administration
AWARDED BY NOTTINGHAM TRENT UNIVERSITY, UK
Thinking & Managing Ethically
Assignment
March 2012
Assignment
(100 marks)
Completed assignments must be submitted by the student
through email to mbaassignments@wecouncil.com on or
before the given deadline. Late assignments will not be
accepted.
Awarded by Nottingham Trent University, UK
Assignment
MODULE
:
Thinking and Managing Ethically
SUBMISSION DATE
:
WEEK 6 – 15th April, 2012 [Before 12.00 midnight Malaysia
Singapore time]
LENGTH
:
3000 TO 3500 WORDS
BECTON DICKINSON AND NEEDLE STICKS
During the 1990s, the AIDS epidemic posed peculiarly acute dilemmas for health
workers. After routinely removing an intravenous system, drawing blood, or delivering
an injection to an AIDS patient, nurses could easily stick them with the needle they were
using. “Rarely a day goes by in any large hospital where a needle stick incident is not
reported.” In fact, needlestick injuries accounted for about 80 percent of reported
occupational exposures to the AIDS virus among health care workers. It was
conservatively estimated in 1991 that about 64 health care workers were infected with the
AIDS virus each year as a result of needlestick injuries.
AIDS was not the only risk posed by needlestick injuries. Hepatitis B, Hepatitis C, and
other lethal diseases were also being contracted through accidental needlesticks. In 1990,
the Center for Disease Control (CDC) estimated that at least 12,000 health care workers
were annually exposed to blood contaminated with the Hepatitis B virus, and of these 250
died as a consequence. Because the Hepatitis C virus had been identified only in 1988,
estimates for infection rates of health care workers were still guesswork but were
estimated by some observers to be around 9,600 per year. In addition to AIDS, Hepatitis
B, and Hepatitis C, needlestick injuries can also transmit numerous viral, bacterial,
fungal, and parasitic infections, as well as toxic drugs or other agents that are delivered
through a syringe and needle. The cost of all such injuries was estimated at $400 million
to $1 billion a year.
Several agencies stepped in to set guidelines for nurses, including the Occupational
Safety and Health Administration (OSHA). On December, 1991, OSHA required
hospitals and other employers of health workers to (a) make sharps containers (safe
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Assignment
needle containers) available to workers, (b) prohibit the practice of recapping needles by
holding the cap in one hand and inserting the needle with the other, and (c) provide
information and training on needlestick prevention to employees.
The usefulness of these guidelines was disputed. Nurses worked in high-stress emergency
situations requiring quick action, and they were often pressed for time both because of
the large number of patients they cared for and the highly variable needs and demands of
these patients. In such workplace environments, it was difficult to adhere to the
guidelines recommended by the agencies. For example, a high-risk source of needlesticks
is the technique of replacing the cap on a needle (after it has been used) by holding the
cap in one hand and inserting the needle into the cap with the other hand. OSHA
guidelines warned against this two-handed technique of recapping and recommended
instead that the cap be placed on a surface and the nurse use a one-handed “spearing”
technique to replace the cap. However, nurses were often pressed for time and, knowing
that carrying an exposed contaminated needle is extremely dangerous, yet seeing no
ready surface on which to place the needle cap, they would recap the needle using the
two-handed technique.
Several analysts suggested that the nurse’s work environment made it unlikely that
needlesticks would be prevented through mere guidelines. Dr. Janine Jaegger, an expert
on needlestick injuries, argued that “trying to teach health care workers to use a
hazardous device safety is the equivalent of trying to teach someone how to drive a
defective automobile safely…. Until now the focus has been on the health care worker,
with finger wagging at mistakes, rather than focusing on the hazardous product design….
We need a whole new array of devices in which safety is an integral part of the design.”
The Department of Labor and Department of Health and Human Services in a joint
advisory agreed that “engineering controls should be used as the primary method to
reduce worker exposure to harmful substances.”
The risk of contracting life-threatening diseases by the use of needles and syringes in
health care settings had been well documented since the early 1980 and 1981, for
example, reported on the “problem” of “needle stick and puncture wounds” among health
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Assignment
care workers. Several articles in 1983 reported on the growing risk of injuries hospital
workers were sustaining from needles and sharp objects. Articles in 1984 and 1985 were
sounding higher-pitched alarms on the growing number of Hepatitis B and AIDS cases
resulting from needlesticks.
About 70 percent of all needles and syringes used by U.S. health care workers were
manufactured by Becton Dickinson. Despite the emerging crisis, Becton Dickinson
decided not to change the design of its needles and syringes during the early 1980s. To
offer a new design would not only require major engineering, retooling, and marketing
investments but would mean offering a new product that would compete with its flagship
product, the standard syringe. According to Robert Stathopulos, who was an engineer at
Becton Dickinson from 1972 to 1986, the company wanted “to minimize the capital
outlay” on any new device. During most of the 1980s, therefore, Becton Dickinson opted
to do no more than include in each box of needled syringes an insert warning of the
danger of needlesticks and of the dangers of two-handed recapping.
On December 23, 1986, the U.S. Patent office issued patent number 4,631,057 to Norma
Sampson, a nurse, and Charles B. Mitchell, an engineer, for a syringe with a tube
surrounding the body of the syringe that could be pulled down to cover and protect the
needle on the syringe. It was Sampson and Mitchell’s assessment that their invention was
the most effective, easily usable, and easily manufactured device capable of protecting
users from needlesticks, particularly in “emergency periods or other times of high stress.”
Unlike other syringe designs, theirs was shaped and sized like a standard syringe so
nurses already familiar with standard syringe design would have little difficulty adapting
to it.
The year after Sampson and Mitchell patented their syringe, Becton Dickinson purchased
from them an exclusive license to manufacture it. A few months later, Becton Dickinson
began field tests of early models of the syringe using 3-cc model. Nurses and hospital
personnel were enthusiastic when shown the product. However, they warned that if the
company priced the product too high, hospitals, with pressures on their budgets rising,
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could not buy safety syringes. With concerns about AIDS rising the company decided to
market the product.
In 1988, with the field tests completed, Becton Dickinson had to decide which syringe
would be marketed with the protective sleeves. Sleeves could be put on all of the major
syringe sizes, including 1-cc, 3-cc, 5-cc and 10-cc syringes. However, the company
decided to market only a 3-cc version of the protective sleeve. The 3-cc syringes
accounted for about half of all syringes used, although the larger sizes—5-cc and 10-cc
syringes—were preferred by nurses when drawing blood.
This 3-cc syringe was marketed in 1988 under the trademarked name Safety-Lok Syringe
and sold to hospitals and doctors’ offices between 50 and 75 cents, a price that Becton
Dickinson characterized as a “premium’ price. By 1991, the company had dropped the
price to 26 cents a unit. At the time, a regular syringe without any protective device was
priced at 8 cents a unit and cost 4 cents to make. Information about the cost of
manufacturing the new safety syringe was proprietary, but an educated estimate would
put the costs of manufacturing each Safety-Lok syringe in 1991 at 13 to 20 cents.
The difference between the price of a standard syringe and the “premium” price of the
safety syringe was an obstacle for hospital buyers. To switch to the new safety syringe
would increase the hospital’s costs for 3-cc syringes by a factor of 3 to 7. An equally
important impediment to adoption was the fact that the syringe was available in only one
3-cc size, and so, as one study suggested, it had “limited applications.” Hospitals are
reluctant to adopt, and adapt to a product that is not available for the whole range of
applications the hospital must confront. In particular, hospitals often needed the larger 5cc and 10-cc sizes to draw blood, and Becton Dickinson had not made these available
with a sleeve.
In 1992, a nurse, Maryann Rockwood (her name is disguised to protect her privacy), was
working in a San Diego, California, clinic that served AIDS patients. That day she used a
Becton Dickinson standard 5-cc syringe and needle to draw blood from a patient known
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to be infected with AIDS. After drawing the blood, she transferred the AIDScontaminated blood to a sterile test tube called a Vacutainer tube by sticking the needle
through the rubber stopper of the test tube, which she was holding with her other hand.
She accidently pricked her finger with the contaminated needle. A short time later, she
was diagnosed as HIV positive.
Maryann Rockwood sued Becton Dickinson, alleging that, because it alone had an
exclusive right to Sampson and Mitchell’s patented design, the company had a duty to
provide the safety syringe in all its sizes and that by withholding other sizes from the
market it had contributed to her injury. Another contributing factor, she claimed, was the
premium price Becton Dickinson had put on its products, which prevented employers like
hers form purchasing even those sizes that Becton Dickinson did make. Becton
Dickinson quietly settled this and several other, similar cases out of court for undisclosed
sums.
By 1992, OSHA had finally required that hospitals and clinics give their workers free
Hepatitis B vaccines and provide safe needle disposal boxes, protective clothing, gloves,
and masks. The Food and Drug Administration (FDA) also was considering requiring
that employers phase in the use of safety needles to prevent needlesticks, such as the new
self-sheathing syringes that Becton Dickinson was now providing. If the FDA or OSHA
required safety syringes and needles, however, this would hurt the U.S. market for
Becton Dickinson’s standard syringe and needles, forcing it to invest heavily in new
manufacturing equipment and a new technology. Becton Dickinson, therefore, sent its
marketing director, Gary Cohen, and two other top executives to Washington, D.C., to
convey privately to government officials that the company strongly opposed a safety
needle requirement and that the matter should be left to “the market.” The FDA
subsequently decided not to require hospitals to buy safety needles.
The following year, a major competitor of Becton Dickinson announced that it was
planning to market a safety syringe based on a new patent that was remarkably like
Becton Dickinson’s. Unlike Becton Dickinson, however, the competitor indicated that it
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Assignment
would market its safety device in all sizes and that it would be priced well below what
Becton Dickinson had been charging. Shortly after the announcement, Becton Dickinson
declared that it, too, had decided to provide its Safety-Lok syringe in the full range of
common syringe sizes. Becton Dickinson now proclaimed itself the “leader” in the safety
syringe market.
However, in 1994, the most trusted evaluator of medical devices, a nonprofit group
named ECRI, issued a report stating that after testing it had determined that although
Becton Dickinson’s Safety-Lok Syringe was safer than Becton Dickson’s own standard
syringe, nevertheless the Safety-Lok “offer poor needlestick protection.” The following
year this low evaluation of the Safety-Lok Syringe was reinforced by the U.S. Veteran’s
Administration, which ranked the Safety-Lok Syringe below the safety products of other
manufacturers.
The technology for safety needles took a giant step forward in 1998 when Retractable
Technologies, Inc., unveiled a new safety syringe that rendered needlesticks a virtual
impossibility. The new safety syringe, invented by Thomas Shaw, a passionate engineer
and founder of Retractable Technologies, featured a syringe with a needle attached to an
internal spring that automatically pulled that needle snapped back into the syringe faster
than the eye could see. Called the Vanishpoint syringe, the new safety syringe required
only one hand to operate and was acclaimed by nursing groups and doctors.
Unfortunately, it was difficult for Retractable to sell its new automatic syringe because of
a new phenomenon that had emerged in the medical industry.
During the 1990s, hospitals and clinics had attempted to cut costs by reorganizing
themselves around a few large distributors called Group Purchasing Organizations or
GPOs. A GPO is an agent that negotiates prices for medical supplies on behalf of its
member hospitals. Hospitals became members of the GPO by agreeing to buy 85 percent
to 95 percent of their medical supplies from the manufacturers designated by the GPO,
and their pooled buying power then enabled the GPO to negotiate lower prices for them.
The two largest GPOs were Premier, a GPO with 1,700 member hospitals, and Novation,
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a GPO with 650 member hospitals. GPOs were accused, however, of being prey to
“conflict of interest” because they were paid not by the hospitals for whom they worked,
but by the manufacturers with whom they negotiated prices (the GPO received from each
manufacturer a negotiated percentage of the total purchases its member companies made
from that manufacturer). Critics claimed that manufacturers of medical products in effect
were paying off GPOs to get access to the GPO member hospitals. In fact, critics alleged,
GPOs such as Premier and Novation no longer tried to bring their member hospital the
best medical products nor the lowest-priced products. Instead, critics alleged, GPOs
chose manufacturers for their members based on how much a manufacturer was willing
to pay the GPO. The more money (the highest percentage of sales) a manufacturer gave
the GPO, the more willing the GPO was to put that manufacturer on the list of
manufacturers from which its member hospitals had to buy their medical supplies.
When Retractable tried to sell its new syringe, which was recognized as the best safety
syringe on the market and as the only safety syringe capable of completely eliminating all
needlesticks in a nursing environment, it found itself blocked from doing so. In 1996,
Becton Dickinson had gotten Premier GPO to sign an exclusive, 7 ½ year, $1.8 billion
deal that required Premier’s member hospitals to buy at least 90 percent of their syringe
and needles from Becton Dickinson. Around the same time, Becton Dickinson had signed
a similar deal with Novation that required its member hospitals to buy at least 95 percent
of their syringe needles from Becton Dickinson, or suffer substantial financial penalties,
they turned away Retractable’s salespeople, even when their own nursing staffs
recommended Retractable’s safety product as better and more cost-effective than Becton
Dickinson’s.
Although Retractable’s safety syringe was almost double the cost of Becton Dickinson’s,
hospitals that adopted Retractable’s syringe would save money over the long run because
they would not have to pay any of the substantial costs associated with having their
workers suffer frequent needlesticks and needlestick infections. The Center for Disease
Control (CDC) estimated that each needlestick in which the worker was not infected by
any disease cost a hospital as much as $2,000 for testing, treatment, counseling, medical
costs, and lost wages, plus unmeasurable emotional trauma, anxiety, and abstention from
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sexual intercourse for up to a year. Those needlesticks in which the victim was infected
by HIV, Hepatitis B or C or some other potentially lethal infection, cost a hospital
between $500,000 to more than $1 million and cost the victim anxiety, sickness from
drug therapy, and, potentially, life itself. Retractable’s syringe completely eliminated all
of these cost. Because all of the other syringes then on the market, including Becton
Dickinson’s Safety-Lok, still allowed some needlesticks to occur, they could not
completely eliminate all the costs associated with the needlesticks and so were not as
cost-effective. (A CDC study found that Becton Dickinson’s Safety-Lok, when tested by
hospital health workers in three cities from 1993 to 1995, had cut needle-stick injuries
only from 4 per 100,000 injections down to 3.1 per 100,000 injections, a reduction of
only 23 percent, the worst performance of all the safety devices tested.) An econometric
study commissioned by Retractable proved that its safety syringe was the most costeffective syringe on the market.
In October 1999, ECRI, the nation’s most respected laboratory for testing medical
products, rated Becton Dickinson’s Safety-Lok syringe “unacceptable” as a safety
syringe, saying it might actually cause an increase in needlesticks because it required two
hands to use it and one hand might accidentally touch the needle. It simultaneously gave
Retractable’s Vanishpoint syringe its highest rating as a safety syringe, the only safety
syringe to achieve this highest level. Becton Dickinson objected strenuously to the low
rating of its own syringe, and in 2001, the testing lab raised the rating for the Safety-Lok
a notch to “not recommended.” Retractable’s Vanishpoint syringe, however, continued to
receive the highest rating. In spite of being recognized as the best and most cost-effective
technology for protecting health care workers from being infected through needlesticks,
Retractable still found itself blocked out of the market by the long-term deals that Becton
Dickinson had negotiated with the major GPOs.
In 1999, California became the first state to require its hospitals to provide safety
syringes to its workers. Then, in November 2000, the Needlestick Safety and Prevention
Act was signed into law. The act required the use of safety syringe in hospitals and
doctor’s offices. In 2001, OSHA incorporated the provisions of the Needlestick Safety
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Assignment
and Prevention Act, finally requiring hospitals and employers to use safety syringes, a
development that is expected to bring lower prices. None of this legislation required a
specific type of brand of syringe and Becton Dickinson’s safety devices were stocked to
most GPO member hospitals.
Continuing to find itself locked out of the market by Becton Dickinson’s contracts with
Premier and Novation, Retractable sued Premier, Novation, and Becton Dickinson in
federal court alleging that they violated antitrust laws and harmed consumers and
numerous health care workers by using the GPO system to monopolize the safety needle
market. In 2003, Premier and Novation settled with Retractable out of court, agreeing to
henceforth allow its member hospitals to purchase Retractable’s safety syringes when
they wanted. In 2004, Becton Dickinson also settled out of court, agreeing to pay
Retractable $100 million in compensation for the damage Becton Dickinson inflicted on
Retractable. During the 6 years that Becton Dickinson’s contracts prevented Retractable
and other manufacturers from selling their safety needles to hospitals and clinics,
thousands of health workers continued to be infected by needlesticks each year.
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Assignment
ASSIGNMENT QUESTIONS
1. In your judgment, did Becton Dickinson have an obligation to provide the safety
syringe in all its sizes in 1991? Explain your position, based on the ethics of
consumer production and marketing and the principles of utilitarianism, rights,
justice, and caring.
(30 Marks)
2. Should manufacturers be held liable for failing to market all the products for
which they hold exclusive patents when someone’s injury would have been
avoided if they had marketed those products? Explain your answer.
(30 Marks)
3. In your judgment, who was morally responsible for Maryann Rockwood’s
accidental needlestick: Maryann Rockwood? The clinic that employed her? The
government agencies that merely issued guidelines? Becton Dickinson?
(20 Marks)
4. Evaluate the ethics of Becton Dickinson’s use of the GPO system in the late
1990s. Are the GPO’s monopolies? Are they ethical? Explain.
(20 Marks)
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Assignment
Instructions
1.
2.
The assignment MUST be submitted on-line on or before the due date.
Assignment has to be submitted on or before 15th April, 2012 before 12.00 midnight
Malaysia & Singapore Time Zone.
3. Assignments should be word processed.
4. Your assignment should be organized under suitable headings. An analytical piece of work
is required. The use of ‘cut and paste’ approach will be penalized. It must be presented in a
structured manner, with appropriate cover page, content page, abstract page, introduction,
body (with appropriate heading / sub-headings), conclusion, references and any required
appendices.
5. The assignments shall contain a minimum of 3000 to a maximum 3500 words, presented
in text of font size 12 with 1.5 line spacing.
6. Your assignment shall reflect the depth and breadth of your original analyses in a clear and
coherent manner. Due credit shall be given for excellent illustration of points using
diagrammatic mode.
7. Any reference to authors and other writers shall be quoted with due acknowledgement in
your assignment report using the Harvard Referencing System or APA.
8. The cover page should be attached with the assignment and uploaded through SERF online. Name of the student, The Programme, Module Title, Assignment Title and the
selected Topic along with on-line Signature of student and number of words must be
reflected on the cover sheet.
9. All assignments must be adhered strictly to the deadlines specified by WEC. Failure to
hand in the assignment for any reason and without prior approval of the Course Leader will
result in the participant’s work being penalized in accordance with the Academic &
Assessment Regulations governing the conduct of the Master of Business Administration
programme as follows:
• Five days late - the assessed mark will be reduced by five percentage points
• Ten days late - the assessed mark will be reduced by ten percentage points
• Over 10 days late - the module assessor can refuse to mark the piece of work and will
record a zero mark.
10. Unacknowledged use of work of others (plagiarism) is regarded as a dishonest practice and
will be dealt with severely as follows:
11. In a case of suspected plagiarism it is the right and duty of the Board of Examiners to:
a)
receive all information pertinent to the case in written form or verbal evidence
including the submitted work itself;
b) seek further advice where appropriate;
c)
12.
confirm or reject the accusation of plagiarism; determine its recommendation where it
confirms the case according to the circumstances and severity of the case.
It may recommend that
a)
the case constitutes plagiarism and that the participant fails with or without the right of
resubmission;
b) the submitted work fail. It will then be the responsibility of the Board of Examiners to
determine whether or not this failure in assessment can be compensated for in the light
of the participant's overall performance or whether or not the participant will be
required to retake part or all of the elements for progression towards or the conferment
of the award;
c)
the participant be penalized by a reduction in the mark for this assessment and/or
classification of the award. The Board of Examiners shall then agree a mark and/or
classification;
d) the participant be issued with a formal reprimand in writing and a copy of this lodged in
the participant’s file.
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Assignment
MARKS ALLOCATION BREAKDOWN
Part 1: Technical component
Level
1.1 Setting the scene /introduction/problem statement/background analysis
1.2 Structure and presentation
1.2.1
Logic sequence with section well linked and well organized
1.2.2
Good flow and clarity of presentation
1.2.3
Balance between text and use of charts, diagrams, headings
1.2.4
Use of appropriate terminology and style for professional and technical
7.5 %
7.5 %
writing
1.2.5
Proper referencing method
1.2.6
Compliance word count
Subtotal
15.0 %
Part 2: Understanding of existing body of knowledge
2.1 Use of wide range of information from a variety of sources, with appropriate
10.0 %
referencing and own style of presentation to address the issue/Literature review
2.2 Using appropriate example, case study, data and sample to clarify and support
10.0 %
exposition
2.3 Completeness, relevancy, accuracy and correctness of material use to support exposition
Subtotal
10.0 %
30.0 %
Part 3: Application of the knowledge learned
3.1 Contextualize the learning to the work place by providing and discussing real-world
situation where the concepts can be applied.
15.0 %
3.2 Making quality recommendations and conclusions with supporting ideas of why the
conclusions and recommendations are relevant and important to the situation, and how
15.0 %
the recommendations can improve the current situation. Recommendations should also
include possible implementation obstacles and problems.
3.3 Balanced discussion of issues where pro’s and con’s, costs and benefits, strength and
15.0 %
weaknesses are well considered.
3.4 Originality and creativity: proposing new and innovative ideas, creative use of existing
approach to new area of applications, critical analysis of existing ideas and approaches,
10.0 %
new insights into existing problems, improvement of existing methods,…
Subtotal
55.0 %
TOTAL MARKS FOR 100%
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