In December 2006, Pfizer announced the halt of the Torcetrapib clinical trial, a once very
promising drug in the fight against coronary artery and heart disease. At the same time, Pfizer
announced its initial plans of layoffs and cost reductions would be expedited as a result of the
trials. With the loss of patent protections for a series of drugs including Lipitor, the cancellation
of Bextra, and the black label warning on Celebrex tablets, how does Pfizer seek continued
success while appeasing shareholders? 9 pp. Case #07-01. (2007)

As the United States reeled from terrorist attacks in the days following September 11, 2001, the
threat of bio-terrorism emerged in the form of Anthrax. Envelopes containing the biological
weapon began to appear in Washington, New York, and Florida. Bayer CEO Manfred Schneider
soon found his company in an unusual position. The company’s drug, Cipro, was the only
FDA-approved medication for the treatment of Anthrax. Bayer was in the international spotlight
as the press, public, and politicians began to debate whether Bayer could provide enough of the
drug to keep the U.S. population safe, and whether the company’s patent should be rescinded to
allow for generic production. Dr. Schneider must decide how to extinguish doubts without losing
his most profitable product. 12 pp. Case #02-03. (2002)

Bayer responds to concerns about Phenlypropanolamine (PPA) found in its key brand,
Alka-Seltzer Plus, by co-sponsoring a study to assess the safety of the ingredient. The study finds
that PPA does carry a risk, and the Federal Drug Administration requests a voluntary recall.
Bayer must confront the media’s distorted interpretation of the recall before it taints the
reputation of Alka-Seltzer Plus and other important Bayer brands. As it enters the peak season
for flu and cold medications, Bayer must also decide how to respond to a recall as it faces losses
from promotional campaigns and sales, as well as a loss in consumer confidence. 14 pp. Case
#01-13. (2001)

On March 3, 2006, Bausch & Lomb received a phone call from New Jersey ophthalmologist Dr. David S.
Chu regarding three patients afflicted with a serious fungal condition known as fusarium keratitus. These
patients all were contact-lens wearers, and had used Bausch & Lomb’s ReNu with MoistureLoc lens
solution. This telephone call started a chain of events, accusations, and CDC investigations that
eventually led to a recall by Bausch & Lomb in the U.S. and overseas, but not before the crisis had
threatened to damage not only sales of its popular lens solution, but also Bausch & Lomb’s reputation.
18 pp. Case #06-16. (2006)

In September 2006, Bristol-Myers Squibb announced that it had fired CEO Jim Dolan, who had led the
company since 2001. Dolan’s termination was the result of a failed patent protection agreement with
Canadian generic pharmaceutical company, Apotex. The agreement was designed to prevent Apotex
from releasing a generic version of Plavix, Bristol-Myers Squibb’s blockbuster blood thinner medication
that had revenues of $5.9 billion and accounted for 30% of Bristol-Myers’ total sales. Federal regulators
refused to sign off on the deal and started an investigation into the agreement. Meanwhile, Apotex
released its generic Plavix and quickly gained 75% market share of new prescriptions. The failed
agreement was the second major problem that occurred during the tenure of Dolan: due to an accounting
scandal, Bristol-Myers was forced to restate earnings for 2001, 2000 and 1999, which caused the
company to pay fines of over $800 million. During Dolan’s time as CEO, Bristol-Myers’ stock price
declined by 60%. After the failed patent agreement and accounting scandals, Bristol-Myers was faced
with an upcoming Plavix patent protection trial. The company must find a way to regain stockholder
trust. 10 pp. Case #06-17. (2006)

Gilead Sciences’ hepatitis C drug, Sovaldi, proved more effective than the competition and was priced in line with market conditions. However, extremely high cost and large patient population captured the attention of the media, the public, NGOs, and even the government. The controversy deepened when the company revealed the cost in developing countries would be roughly 1% of the cost in the U.S. Case #14-10 (A)12 pp (B) 4 pp. Case # 14-10 (2014)

A series of controversies and market reversals begin to affect one of the world’s largest
pharmaceutical firms. As share price tumbles and market share erodes, CEO J. P. Garnier is
awarded a very large compensation package early in 2003. Shareholders revolt, voting down the
executive compensation package, and threaten to take down the management team. GSK
Chairman Lord Christopher Hogg and Communications VP Jennie Younger must decide how to
proceed in the face of mounting criticism and public outrage. 13 pp. Case #04-02. (2004)

On September 16, 2010, amidst a congressional inquiry into numerous product recalls over the
past 15 months, Johnson & Johnson’s Chairman of the Consumer Group, Colleen Goggins,
announced her retirement. With the bulk of the recall focused on their flagship product, Tylenol,
the tendency was to compare these with the famous recall in 1982, which cemented the public’s
trust in the company. Unfortunately, that trust has eroded because of their reaction to the
numerous current product issues. When it was revealed that subcontractors had secretly bought
back Motrin off the shelves without notifying the public that something was wrong with it, J&J
found itself with a much larger issue than just public dismay. This phantom recall had compelled
FDA regulators to call upon its crime unit to investigate whether or not these actions by Johnson
& Johnson constitute criminal behavior. 15 pp. Case #10-11

Domestic advice and home products maven Martha Stewart is accused of selling nearly 4,000
shares of ImClone Systems, Inc. stock shares, just ahead of a public announcement that the
company’s promising new drug, Erbitux, has failed FDA clinical testing. Accusations of insider
trading, based on her special relationships with ImClone CEO Samuel Waksal and Merrill Lynch
broker Peter Bacanovic, threaten her own company’s reputation, share price, and market position.
Can Martha Stewart Living Omnimedia survive accusations of misconduct or the downfall of its
namesake? (A) Case, 16 pp. (B) Case, 5 pp. Case #02-15. (2002 & 2004)

Influenced by the preliminary results of an internal clinical trial, Raymond Gilmartin, CEO of Merck,announced that the company was pulling its blockbuster arthritis drug Vioxx® from the worldwide marketon September 30, 2004. Merck & Company, Inc., once the world’s largest pharmaceutical company, sawits stock price plummet 27% after the recall announcement. Facing recent sales declines, a barrage oflawsuits, and two separate government investigations, Merck is losing its once-stellar reputation in thepharmaceutical industry. (A) Case, 10 pp. (B) Case, 5 pp. Case #05-01. (2005)

In August of 2016, Mylan Pharmaceutical came under public scrutiny for its highly priced EpiPen, a drug used to treat life threatening allergic reactions. “EpiGate” erupted almost overnight, as EpiPen customers took to social media to voice their frustrations. Mylan was accused of using “greedy robber baron” tactics against a helpless customer base. Mylan issued several price-related reparations to its customers (increased rebates, generic product offerings). A month later, Mylan was still struggling to silence its critics. Why did Mylan’s responses fail to address their concerns? What was missing in Mylan’s strategy? This case illustrates (a) the influence of social media on corporate reputation (b) the difficulties of balancing business strategy and public approval and (c) the principles of successfully responding to negative news media. (A) Case, 7 pp. Case #17-04. (2017)

Bhagwangar Dhanishtha Kika; Smith, Matthew R.; and O’Rourke, J. S. (Editor)
Clinical tests showed cholesterol drug Vytorin® was not living up to the claims of the producers,
Schering-Plough and Merck. Consumers could receive a virtually equivalent drug for one-third
of the cost. The problem facing Schering-Plough was to find the best methods to reach its
stakeholders and ensure them that their concerns will be addressed in a timely and effective
manner. This case has health, financial, and legal ramifications for stakeholders. 11 pp. Case
#08-11. (2008)

In September 2005, Rachel Pourchot entered a Target store in Fenton, Missouri, intending to fill
prescriptions for Ortho TriCyclen, a common hormonal contraceptive, and for Levonorgestrel, an
emergency contraceptive known as the “Plan B” pill. Target’s pharmacist, however, told her that
he would not fill the prescription for Levonorgestrel on moral and religious grounds. As
competitors Walgreen’s and Wal-Mart made their positions clear on the issue of pharmacists’
acts of conscience, Target Corporation struggled with an appropriate response that would satisfy
the needs of its customers and its employees, while protecting the reputation of the firm at the
same time. 6 pp. Case #06-11. (2006)

In spite of similar formulation, Swiss pharmaceuticals giant Roche has always positioned its two products Avastin and Lucentis separately, as treatments for cancer and for age-related macular degeneration (AMD) respectively. However, doctors have been prescribing Avastin for AMD treatments because of the huge price differential between the two drugs. With contamination of Avastin due to repackaging by a Florida pharmacy leading to 21 cases of patient blindness in Q3 2011, Roche faces a serious threat to its reputation and finances.

Millions of women worldwide between the ages of 45 and 55 experience the effects of
menopause and have sought both treatment and relief in the form of hormone replacement
therapy. Wyeth Pharmaceuticals, a division of Wyeth, Inc., is the market leader in prescription
drug treatment for menopause with Premarin®, a blend of natural estrogens (for women who
have had a hysterectomy), and Prempro®, a one-tablet hormone replacement therapy consisting
of natural estrogens plus progestin. A stunning set of results from the Women’s Health Initiative,
released in the summer of 2002, however, challenges conventional approaches to treatment and
poses a significant threat to Wyeth share price and market leadership. (A) Case, 12 pp. (B) Case,
4 pp. Case #03-05. (2003)