Discuss why GJPL should attempt to address the issue of untoward clinical outcomes of Healbeat in patients, the patent of which it has licensed out…

(a) Answers to Descriptive Questions 1.8 (i) GJPL is the original patent holder of Healbeat. However, since it has chosen to focus on its core product portfolio, the company licensed out the patent to YLL for the manufacture, marketing, and sale of Healbeat. GJPL does not exercise any control over YLL's activities and only earns substantial royalty income from the sales of Healbeat. Although GJPL does not bear direct responsibility for the tragic loss of lives of patients caused by YLL's substandard production practices, modern organizations are expected to uphold a broader moral duty of care toward stakeholders, including those not directly connected to the company. In this case, GJPL owes a duty of care to the end-user patients consuming Healbeat, the patent of which it owns. Due to inadequate quality control measures, YLL produced substandard medicines, resulting in patient deaths. End users have a right to safe and effective medicines for the treatment of their ailments. Since these fatalities are directly linked to the consumption of a drug patented by GJPL, the company should make efforts to address the issue. From a corporate perspective, such incidents can severely damage the company's brand image and reputation. (ii) Some of the actions that GJPL can take are: (a) GJPL can develop a comprehensive Code of Conduct outlining acceptable business standards. These standards should clearly specify the criteria that licensed manufacturers must follow, particularly in the selection of raw material suppliers, to ensure the quality of inputs. GJPL should mandate that manufacturers like YLL implement this Code of Conduct along with other compliance measures, and also require them to submit to periodic inspections by GJPL to verify adherence to these standards. (b) GJPL should establish an independent audit team to periodically review the operations of contract manufacturers such as YLL. These audits should be conducted both at the pre-sourcing stage (before entering into any agreement) and at regular follow-up stages. GJPL should engage only with manufacturers willing to comply with its Code of Conduct, and contract manufacturing agreements should incorporate provisions for penalties or termination of contracts in the event of serious violations. (c) As a leading player in the pharmaceutical industry, GJPL should work to build transparency and agility within its supply chain. This would involve having complete visibility over suppliers of critical raw materials such as APIs, potential alternative manufacturers for producing the patented drug, and the distribution channels used for its sale. Greater transparency fosters accountability across the supply chain. Moreover, in cases of repeated violations of the Code of Conduct, GJPL should retain the flexibility to shift production to alternate manufacturers who can ensure safety and efficacy. This approach will not only safeguard the continued production of important patented medicines—crucial for recovering the heavy investments made in research and development—but will also reinforce GJPL's commitment to ethical practices, thereby helping it maintain its reputation as a responsible corporate citizen.