Monday, June 5, 2017

For the public, a fake apology for price-gouging. Behind closed doors, a much more interesting conversation.

The conventional wisdom in public relations says that when a company is faced with a crisis, it should apologize profusely and take decisive action to fix the problem. But here's a more effective idea. How about issue a fake apology, do nothing, and laugh all the way to the bank?

That's what Mylan did in response to public outrage last year over the price of the EpiPen. You remember the story: the epinephrine in the pen cost a buck, but Mylan had jacked the price up to $609 a box. When the story went public and legislators started asking hard questions, Mylan apologized and promised to fix the problem. Then it did nothing. Now the company is in trouble again for overcharging Medicaid.

All this is laid out in a long piece by Charles Duhigg on the business page of the New York Times. It's a sordid tale with lots of grimy details, but one of the most telling stories comes early on, when middle managers at Mylan started raising questions about the price of the EpiPen with Robert Coury, Mylan's chairman.

Mr. Coury replied that he was untroubled. He raised both his middle fingers and explained, using colorful language, that anyone criticizing Mylan, including its employees, ought to go copulate with themselves. Critics in Congress and on Wall Street, he said, should do the same. And regulators at the Food and Drug Administration? They, too, deserved a round of anatomically challenging self-fulfillment.

Later comes this gem.

Then there are situations that, at other firms, might have set off firings or corporate soul-searching, but that at Mylan caused neither. In 2007, reporters discovered that Ms. Bresch had not received the M.B.A. degree she claimed on her résumé. In 2012, Mr. Coury was criticized by investors and the media for repeatedly using the company plane to fly his son to music concerts. (And then there was the time, in 2013, when Mr. Coury, at a Goldman Sachs conference, indicated his dislike for hypothetical questions by saying that “if your aunt had balls, she’d be your uncle.”)

When asked, Ms. Bresch told the reporter there was nothing about the culture at Mylan that she would change

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