 Fraser Seitel |
It’s pretty hard to top Wells Fargo as winner of the award for “worst corporate public relations of the month,” but Mylan, maker of the infamous epinephrine autoinjector EpiPen, has managed to do just that.
While Wells Fargo’s hapless CEO John Stumpf bumbles his way through another brow-beating by another holier-than-thou congressional committee, Mylan CEO Heather Bresch remains sequestered in her West Virginia bunker as her company’s value disintegrates. (Full disclosure: I’m a Mylan shareholder, and I’m mad!)
Mylan, of course, is under fire for jacking up the cost of life-saving EpiPens from $100 for a two-pack in 2009 to $608 today.
To its credit, after Mylan endured furious public pushback, the company quickly back-pedaled to introduce a less-expensive but identical generic product. Further, it moved to subsidize branded EpiPen insurance payments for both commercially insured and uninsured patients.
Such decisive public relations actions to mollify critics and mitigate the crisis should have sufficed to calm the Mylan waters. But then CEO Bresch took the stage and snatched defeat from the jaws of victory.
In other words, she performed horribly.
Her testimony before the House Oversight Committee was an unmitigated disaster. Rather than arriving with the confidence that her company had learned a lesson and righted a wrong, Bresch — the daughter of a U.S. Senator — showed up like a scared rabbit, caught in the cross hairs.
She tied herself up in knots attempting to explain the company’s profit on the EpiPen.
She failed to produce the revenue information Congress had requested.
She insisted the company had saved U.S. taxpayers billions in medical expenses, but couldn’t explain why.
Her only defense of her $18 million compensation was that it was “in the middle” of her industry peer group.
And she kept referring to unwieldy and incomprehensible charts she had brought with her to the hearing.
The coup de grace came when Bresch admitted she had flown by private jet to her Congressional engagement. (Not even Wells Fargo’s sputtering Stumpf made that mistake!)
Predictably, when the rabid Congressional attack dogs encountered Bresch’s unpreparedness, they pounced for the kill, and the CEO staggered from the hearing room.
Which actually would have been okay had not Mylan announced, three days after testifying, that EpiPen profits were really 60 percent higher than Bresch had reported to Congress. The cause of the error: Applying faulty U.S. tax rates.
In Japan, when a company messes up or deceives its investors or cheats its customers, the individuals who run the company immediately resign in disgrace.
Likewise at Mylan, as its stock descends in free fall, there appears only one action the company must take to restore its credibility: Heather Bresch must fire herself.
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Fraser P. Seitel has been a communications consultant, author and teacher for 40 years. He may be reached directly at [email protected]. He is the author of the Prentice-Hall text The Practice of Public Relations, now in its 12th edition, and co-author of Rethinking Reputation and Idea Wise.
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