Ethical Dilemma with Stakeholders

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Hour 0–4 (Immediate Actions)

1. Secure all data

   • Direct the research team to compile the complete dataset, methodology, and evidence into a confidential briefing document.
   • Ensure legal counsel reviews it for attorney-client privilege where applicable.
   • Reasoning: Need an accurate, uncontestable factual basis for all decisions.

2. Convene crisis leadership team

   • Invite Chief Medical Officer, General Counsel, Head of Regulatory Affairs, CFO, Head of Communications, and Head of Patient Safety.
   • Meeting purpose: confirm findings, assess immediate risks, outline legal obligations, and prepare initial steps.
   • Reasoning: Must align key leaders before broader communication.

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Hours 4–12

3. Contact regulators immediately (within 12 hours)

   • Despite legal team’s 6-month formal report timeline, initiate high-priority informal notification to FDA/EMA etc., signaling urgent safety concern and intent to formally report ASAP.
   • Reasoning: Ethical and legal duty to warn regulators promptly; delaying could be seen as concealment if later discovered.

4. Prepare preliminary patient communication plan

   • Work with medical and communications teams to draft a clear, compassionate notice to healthcare providers and patients about potential risk, pending final regulatory review.
   • Reasoning: Patient safety must come first; planning communication now ensures readiness.

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Hours 12–24

5. Engage independent external experts

   • Hire an independent hepatologist and pharmacovigilance expert to review the data and validate the risk.
   • Reasoning: Bolsters credibility, shows due diligence, and prepares for scrutiny.

6. Board pre-brief

   • Send confidential advance materials to all board members detailing findings, regulatory obligations, ethical considerations, and potential financial/legal impacts.
   • Reasoning: Ensures board is informed before meeting; counters the “wait for more data” argument with facts and legal risks.

7. Scenario planning with CFO & legal

   • Model financial impact of immediate disclosure vs. delayed disclosure (including litigation risks, fines, and reputational damage).
   • Reasoning: Need hard numbers to show board that hiding could be more costly long-term.

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Hours 24–36

8. Draft urgent label update proposal

   • Regulatory team begins preparing a supplemental application to add liver failure warning to prescribing information.
   • Reasoning: Demonstrates proactive commitment to safety; can be submitted shortly after formal analysis.

9. PR strategy development

   • Communications team prepares:
     • Internal memo for employees.
     • Press statement for disclosure.
     • Q&A for earnings call.
     • Script for customer service.
   • Reasoning: Coordinated messaging minimizes chaos and rumors.

10. Legal liability assessment

    • Outside counsel briefed to evaluate litigation exposure, especially if delay occurs.
    • Reasoning: Board needs to understand that covering up could lead to punitive damages and criminal charges.

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Hours 36–48 (Board Meeting)

11. Board meeting agenda

    • Present validated data, regulatory obligations, ethical imperative, and patient safety plan.
    • Present analysis: stock drop now vs. catastrophic fallout later if hidden.
    • Call for vote to:
      • Immediately notify regulators formally.
      • Update label ASAP.
      • Notify healthcare providers within 7 days.
      • Disclose publicly before earnings call.
    • Reasoning: Full transparency is legally safest and morally required; waiting risks lives and company survival.

12. Final decision & empower teams

    • Assuming board approves disclosure:
      • Authorize communications team to finalize materials.
      • Regulatory team submits initial formal report.
      • CEO prepares to address employees.
    • Reasoning: Swift execution after decision maintains trust and control of narrative.

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Post 48-Hour Plan (Before Earnings Call)

• Public disclosure before markets open ahead of earnings call.
• Earnings call: Begin with safety update, express commitment to patients, outline financial impact transparently.
• Launch patient safety program offering liver monitoring for high-risk users.
• Employee town hall to ensure staff hear directly from leadership.

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Reasoning Summary

• Ethical/Legal: Concealing a known serious risk could constitute fraud, endanger patients, and destroy the company in lawsuits.
• Financial: A 40% stock drop is severe, but hiding it could lead to total collapse (fines, loss of trust, billions in lawsuits).
• Regulatory: Early cooperation may mitigate regulatory penalties.
• Reputation: Being first to disclose, with a patient safety plan, can preserve some trust.
• Leadership: CEO’s duty is to the patients first, then shareholders’ long-term interests, not short-term stock price.