The impact of sustainable investment in the pharmaceutical industry

The impact of sustainable investment in the pharmaceutical industry

19 November 2019 | 5 min. readingtime

Big Pharma has not been seen in a good light for some time. Their high medicine prices, for example, have made the pharmaceutical industry increasingly unpopular. People hearing only those reports might decide not to invest in this sector. We do invest, as we see also the positive impact.


Health care and the pharmaceutical industry have been making greater strides than ever before with innovations and new medicines. Our ability to cure people is growing every day. The pharmaceutical industry plays a vital role in the development, production and distribution of medicines. At the same time, their high medicine prices, for example, have made pharmaceutical companies increasingly unpopular. Minister Bruins for Medical Care and Sport recently published an article in the Volkskrant newspaper, calling on pharmaceutical companies to take their responsibility in society and be more transparent about their price structure.

“Companies that do not meet our minimum requirements are excluded from our investment universe.”

Raquel Criado Larrea Head of Sustainable Investments

Orphan drugs

At a.s.r. we understand the sensitivity with regard to the high prices for medicines developed for a small group of users. These so-called ‘orphan drugs’ are medicines for rare diseases. We want these – effective – medicines to be available to as many people as possible. At the same time, we recognise that the development and marketing of orphan drugs is very expensive, as the development of new medicines is financed with the proceeds of successful medicines.


Sustainable investor

As an investor, we take responsibility for our investments. We do this in a number of ways. First of all through the selection of our investments. We screen all companies on their ESG (Environmental, Social & Governance) performance. Criteria such as safety, corruption, clear patient information and a responsible production chain are the most important ones, in addition to access to medicine. Companies that do not meet our minimum requirements are excluded from our investment universe. The next step is exercising our role as shareholder by voting at shareholders’ meetings and by ‘engaging’ with companies. And finally, where possible, we explicitly invest in companies and public authorities that have a positive impact on the world: our impact investments.


Engagement with the pharmaceutical industry

We at a.s.r. do not consider pricing and high margins a reason for exclusion, unlike arms, child labour and tobacco, for example. We believe that the discussion on these issues must and can be held with the pharmaceutical companies themselves, through active engagement between investor and management board. One example is our investment in Novartis. This company is accused of corruption in several countries and is under fire for its high medicine prices. However, we have engaged with them with a view to bringing about a change in policy and management that will prevent future controversies, as well as for other reasons. Every six months we report the progress made in these discussions.


Lobbying practices and unethical sales behaviour

In 2018 a.s.r. signed the Access to Medicine Index: an initiative that investigates how the largest pharmaceutical companies perform in making medicines more accessible. Together with Access to Medicine and other affiliated investors, we will engage with the nineteen largest pharmaceutical companies in the coming years to increase the access to medicine. Access to Medicine has been monitoring the progress made by pharmaceutical companies for ten years and the results of this form the basis for engagement. A number of companies are making great strides in making medicines more widely available in low-income countries. At the same time, there is still room for improvement on issues such as bonuses that encourage unethical sales behaviour and transparency on lobbying practices.


a.s.r.: frontrunner in sustainable investments in the pharmaceutical sector

The Dutch Fair Insurance Guide published a new study in 2019, which mentioned a.s.r. as a frontrunner in sustainable investments in the pharmaceutical sector. The study explored whether the pharmaceutical companies receiving investments from Dutch insurance companies charge affordable prices for medicines and whether they pay their due share of taxes. a.s.r. came out on top on all four criteria: the behaviour of the pharmaceutical companies in which we invest, the transparency of our own investments and engagements and the extent to which a.s.r. invests in pharmaceutical companies ranking high on the Access to Medicine Index.


Making good medicines accessible to as many people as possible – that is our goal

The decision whether or not to invest is never taken lightly. The decision whether to invest in the pharmaceutical industry is no exception. Nevertheless, we aim to make a vital contribution to creating a market in which good medicines are accessible to as many people as possible by diligently and meticulously continuing to apply our criteria, being transparent in our choices and results, and engaging with pharmaceutical companies time and time again in our role as a health insurance company and investor.

  • Sustainability


This is an image of Raquel Criado Larrea.

Raquel Criado Larrea

Head of Sustainable Investments

Raquel is responsible for SRI policy and implementation at ASR Nederland.

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