* * 0

The Expanding Circle of Moral

ResponsibilityManuel Velasquez, Santa Clara University

Katie Buck, Affymetrix

* * 0

Moral Responsibility

•Two Meanings:–Obligation or Duty–Culpability: Being to blame for an injury

•Culpability: Agent is morally responsible for an injury when:

–Agent caused it–Agent knew it–Agent could have

prevented it

* * 0 Traditional Extent of Corporate

Moral Responsibility

•Traditionally: –Company is morally responsible for injuries it

inflicts on other parties–Provided:

•it caused the injuries itself, •it knew it was causing

those injuries, and •it could have prevented

the injuries

* * 0 Expansion of Downstream Moral

Responsibility•During Second half of 20th Century

–Company is held responsible for injuries users of its products inflict on themselves while using the company's product (product liability)

•Provided: company knew about it, and could have prevented it.

–Company is also held responsible for injuries users inflict on themselves using defective product

•Even if: company did not know about it, and could not have prevented it (strict liability)

* * 0 Expansion of Upstream Moral

Responsibility•Last 20 years:

–Companies also held responsible for injuries its suppliers inflict on third parties (e.g., employees).

•Most famous: Nike "sweatshops"

–Here: Nike perceived to be an indirect cause, knew or should have known what was going on, and could have prevented it.

* * 0 Expansion of Downstream Moral

Responsibility

•And, Last 20 years:–Companies increasingly held responsible for

injuries their customers inflict on third parties using the companies’ products.

–Examples:•Gun manufacturers•Taverns, Bars

serving alcohol•Manufacturers

of computers

* * 0

Two Main Issues

-To what extent is a company morally responsible for how customers use products, i.e., for injuries customers might inflict on third parties using its products?

-How can company minimize its exposure to this kind of moral responsibility?

–After the fact: publicists, lawyers–Before the fact: monitor customer sales, refuse

to sell if needed.•Gun sales laws•Limiting alcoholic beverage sales

* * 0

Biotech Industry

• Affymetrix is dealing with these

•Products can be used to perform genetic analyses. Information gained by analyses can be used in various ways, some of which have high potential for injury.

•Company uses an “Ethics Advisory Board” to help evaluate and monitor customer uses of its products.

* * 0

Affymetrix

•A spin-off of Affymax –Affymax (founded 1988 by Alejandro

Zaffaroni, sold to Glaxo, sold to private investors in 2001) tested compounds for their potential use as drugs on miniature chips.

•Affymetrix, the spin-off, was founded by Steve Fodor & A. Zaffaroni

–Made miniature chips containing thousands of samples of DNA that allow users to analyze thousands of pieces of genetic information simultaneously

* * 0

AffymetrixHistory

•1989: Affymax Research Institute created as startup inside Affymax, research team led by Steve Fodor

•1991: In February S. Fodor & research team publish report in Science on using photolithography to embed biochemical compounds on silicia-based chips.

•1992: Affymetrix becomes an independent company to pursue this new technology

* * 0

Affymetrix•1993-1995: Raises $21

million from private investors in first round funding, $39 million in second round, and $31 million in government research grants to partner with academic research institutions

•1996: sells first products, (total of 9 systems by end of the year); in June Affymetrix goes public on Nasdaq, raises $90 million.

* * 0

Affymetrix

•2000: Company had secured over 100 patents, sold over 100,000 of its “GeneChip” microarrays

•2001: Affymetrix was leading supplier of genetic diagnosing systems for research

* * 0

Revenues Net Income (loss) 2000 $200,830 ($53,990) 2001 $224,874 ($33,121) 2002 $289,874 ($1,630) 2003 $300,796 $14,285 2004 $345,962 $47,608 2005 $367,602 $57,516

Affymetrix(data in thousands)

* * 0

Affymetrix

•1997: Member of Board of Directors raises question of company's moral responsibility for how its products are/will be used.

•Affymetrix forms Ethics Advisory Board to provide company with advice on its moral responsibilities.

•EAB meets periodically, discusses ethical issues related to customer use of company's products, makes (advisory) recommendations