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Public Relations

Maker’s Mark reverses decision to dilute, misses the mark

Maker’s Mark recently announced they would be altering their formula, but fans protested, and they reversed their decision, treating it like a crisis rather than a mistake, and all with little explanation.

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Maker’s Mark announces new diluted formula

Sometimes you can get in the way of your own business and create a crisis where none had been likely to arise. Maker’s Mark recently announced they would be diluting their original formula, but failed to explain why, and while it may have been to expand to geographical markets that legally require lower alcohol levels, or to simply save money and keep their product pricing from adjusting, they said nothing.

It came across as them saying, “people love our product so much, I bet that if we make a slightly inferior product we can sell even more!” Is that what Maker’s Mark was really thinking?

Now, inferiority is in the intoxication of the beverage drinker. Slightly less alcohol in a beverage you were likely going to water down or mix with something anyway, is not such an egregious offense to me, but from a business standpoint, the decision is a little perplexing.

Maker’s Mark backpedals

Based upon overwhelming feedback from consumers of their product Maker’s Mark has decided to return to the original formula instead of diluting their mix further to be able to better meet the demand they say exceeds their capacity to produce. Why didn’t they just create a “Maker’s Mark Light” or something to cater to those customers who didn’t (or couldn’t legally) buy the liquor for its strength, and leave their highly successful formula alone for those who do?

None of this may sound like a crisis, but Maker’s Mark is very much responding to it as one. They issued an apology declaring, “we’re sincerely sorry we let you down.” How did they mess up like this, and is that apology enough to fix the problem they created? Probably not.

The new Maker’s Mark myth will live on

Until I was sent a note from a colleague pointing out that the company had reversed its decision, I had only heard about the plan to dilute the mixture. I am confident that even years from now you will still run across people in bars who cite the watered-down mixture of Maker’s Mark as the reason they don’t want it – long after those diluted bottles have disappeared.

As I have mentioned before, considering your business’s actions from the perspective of your consumer is critical. If you have spent years of time, energy and creativity in creating your brand, don’t pull a “New Coke” and screw everything up.

David Holmes, owner of Intrepid Solutions, has over 20 years experience planning for, avoiding, and solving crises in the public policy, political, and private sectors. David is also a professional mediator and has worked in the Texas music scene.

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3 Comments

3 Comments

  1. Bob LeDrew

    February 19, 2013 at 5:59 pm

    Interesting post. Whisky (or whiskey) is one of those products with difficulties in production & supply that can be very problematic — how many other businesses must wait years to sell a drop of their product, and the regulatory and taxation burdens on distillers are cumbersome and immense.

    But Maker’s Mark did bobble the ball here. Whiskies like theirs are based on quality and taste. Better to have increased the price to reduce demand rather than to put the brand in jeopardy by seeming cavalier about quality.

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Public Relations

If a terrorist group adopts your brand’s name, what do you do?

(Public Relations) Isis mobile payments are having quite a time of their name as a terrorist group adopts the same name for their brand. Let’s discuss the conundrum.

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Reputation management and your brand

Is your company having a reputation management problem; a little social media crisis? Whatever is going on, it’s unlikely you have it as bad as the Betamax of mobile payments has it lately.

Isis, as I had known it before a few weeks ago, is a mobile payment application that utilizes the NFC chip in many smartphones to make retail purchases once you tie your account to credit cards you already have. Probably the only reason I had ever heard of Isis is that Austin, Texas was one of the early places it rolled out and presumably because Verizon (my carrier) owns part of Isis, Verizon preloaded the app on my phone and for a long time blocked its users’ ability to use competing Google Wallet. Although Verizon always denied it was “blocking” Google Wallet.

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On vacation with my family last week, however, and out to dinner with friends, all around me had to endure my geeky ponderings on how the company with that purple decal on the window of the restaurant next to the credit card decals must be feeling about the violent militant group currently occupying parts of Iraq and Syria – also named ISIS, or the Islamic State of Iraq and Syria. Well, today we found out how they’re feeling when Isis announced they’ll be changing their name; not to be confused with the news last week that ISIS in Iraq was also changing its name.

Some have reasoned that because relatively few Americans are paying attention to the crisis in Iraq and because of the obscurity of the mobile payment system at this point, changing the name and all of the costs associated with rebranding might be overkill. However, for a company still trying to grow and gain brand awareness, the uncertainty of the duration and severity of the crisis in Iraq and Syria does pose a real problem.

A cause for pause

Media outlets are still almost universally using the name ISIS to describe the militant group despite their own rebranding efforts, and the mobile payment company has to be asking itself what the value of the name Isis was anyway. It certainly doesn’t describe the service in any way, and it is likely they initially chose the name because it wasn’t associated with much of anything other than an Egyptian Goddess who was basically the Mother Teresa of Egyptian Goddesses. But now they cannot as easily define the word “Isis” in consumer’s minds while competing with a violent movement in the news.

It is unlikely that your company’s name will be adopted by a terrorist group, of course. But the whole scenario might cause you to pause and consider the value and identity of your own brand. What would have to happen for you to decide you had to completely rebrand? And if you are considering the creation of a new product or brand, it is worth taking the time to imagine the most likely potential threats to that brand and what your reaction would be to those threats.

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Opinion Editorials

BioMarin CEO calls terminal cancer patient a “spoiled petulant brat”

BioMarin pharmaceutical continues to astonish, not by their move to refuse a dying cancer patient life-saving treatment, despite the FDA’s direct approval to do so, but by their CEO writing aggressive emails laced with insults and condescension. Not advisable to any company, whether in a moment of crisis or not.

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biomarin ceo

Jean-Jacques Bienaimé, Chief Executive Officer, BioMarin Pharmaceutical

Great occasions do not make heroes or cowards; they simply unveil them to the eyes. Silently and imperceptibly, as we wake or sleep, we grow strong or we grow weak, and at last some crisis shows us what we have become. – Brooke Foss Westcott, British Theologian, 1825-1901

BioMarin Pharmaceutical continues on the war path

Two weeks ago, I forewarned that BioMarin Pharmaceutical was headed toward a crisis and last week we discussed the accidental “reply-all” email the CEO sent out revealing the company’s crisis strategy.  I could never have predicted this week’s developments.

I have witnessed and studied crises of one sort or another over the last two decades and I have difficulty recalling too many examples of companies handling issues they face as poorly as BioMarin has.

Oh, we had Kenneth Cole tweet a few months ago that the uprisings in Egypt were caused by his Spring collection; and Abercrombie & Fitch has endured several years of criticism after their CEO said that the company only markets to good looking people.  But even in tasteless fashion empires, we do not frequently see CEOs go on email rampages in response to public outcry about their company’s behavior.

Supporters of Andrea Sloan have forwarded emails I will share below, and in conversation with Andrea, she discussed with me her feeling of having been mislead by the company’s Chief Medical Officer, who is no longer a licensed doctor.

To catch you up if you have not read previous articles on the situation, Andrea Sloan is an ovarian cancer patient.  Her doctors at MD Anderson say that due to her treatment history, traditional, available therapies will no longer be tolerable by her body.  BioMarin pharmaceutical has had a drug in trials that the FDA has indicated it will permit Andrea to use if the company will give it to her.  BioMarin has promoted this particular drug, BMN673, to investors as the safest and most effective drug of its type.  But to Andrea and her doctors, the company says they just don’t know if it is safe enough.  Over the last few years, the FDA has allowed over 3,000 patients to use drugs that are not yet approved as, basically, a last resort; while denying only a handful of such requests.

What Not To Do if You Are a CEO

Supporters of Andrea Sloan have used social media and letter writing campaigns to appeal to the company in hope they will allow her and others who face her circumstances a last hope.  The letters that I have seen range from heartfelt appeals for moral and ethical behavior, to logic and business reasons it would make sense for the company to grant Andrea compassionate use of their drug.

For a couple weeks, most of the emailed letters Andrea’s supporters sent to the company went unanswered.  Over the last few days, though, that changed; and in a somewhat dramatic manner.

BioMarin’s CEO, Jean-Jacques Bienaime, suddenly started replying to the emailed letters. Far from the measured, careful responses one would expect to come from the CEO of a company, Bienaime resorted to insulting language and at times, unable to come up with his own words describing his perspective, forwarded someone else’s email calling Andrea Sloan “petulant” and “spoiled” as his response.

In Bienaime’s “reply-all” email discussed last week, he laid out two strategies for fighting Andrea:  1. Contradict her doctor’s conclusion that BMN673 is the only drug that has a potential of helping, and 2. Hire a PR firm.  Bienaime made good on the aim to contradict Andrea’s doctors in a national media appearance, but BioMarin is apparently still in need of a PR firm; and one which specializes in crisis management at that.

The email exchanges:

What follows is an email exchange; the first from a supporter of Andrea to Bienaime, the second, his reply to that email:

email1


email2

Beyond it being difficult to understand why his reply is about insurance coverage, which has nothing to do with the situation at hand, his tone is entirely inappropriate.  Does BioMarin’s Board of Directors support their CEO’s statements?  How do his investors feel?  If the company had any type of crisis management plan in place, Bienaime’s responses would not have fit within it.

To another supporter of Andrea, instead of writing his own reply, Bienaime simply forwarded someone else’s words as his response.  The email is far too long to paste here in its entirety, but toward its conclusion, it reads:

email3

On social media, supporters of Andrea were livid and a number of them wrote the CEO in complaint of his having endorsed that perspective of Andrea.  Here is an excerpt of Bienaime’s reply relevant to those complaints:

email

No matter what kind of email the CEO of a company gets, this kind of response is never the correct reaction. How does the CEO of a public company think these replies will help his company in any way? And surely he understands that by writing no words of his own in response and simply forwarding someone else’s words instead; those words become his own.

Also of concern: licensing

Given that BioMarin’s primary strategy to deny Andrea the drug is to disagree with her doctors at MD Anderson regarding the availability of other options, it came to a surprise to Andrea Sloan that the Chief Medical Officer of the company let his license lapse a few days short of five years ago.  According to The Medical Board of California and referencing the date on the image below, if Dr. Fuchs does not renew his license by the end of this month the license will be canceled entirely.

medical

While it is not illegal for Dr. Fuchs to serve BioMarin as its Chief Medical Officer without an active medical license, there has been controversy in other places where problems have occurred in entities which had a non-licensed doctor as its CMO.  In this situation, Andrea Sloan feels mislead because she was told that she needed to sign a waiver so that her doctor at MD Anderson could talk to their Dr. and Chief Medical Officer.

Because of communications Dr. Fuchs has had regarding Andrea Sloan’s medical condition and the company’s insistence – amounting to medical advice – that she has other options, at least one Texas Legislator has agreed to file a complaint to the Medical Board of California for there to be an investigation into whether or not Dr. Fuchs actions amount to practicing medicine without a license.

How Does This End?

BioMarin, some argue, is justified in deciding to wait until later in the drug’s trial process before dispensing it outside of trials for any reason.  But even setting aside bioethical and moral issues surrounding the ability of a dying patient to have every treatment available that has shown promising results, how can the company justify promoting the safety and efficacy of the drug to investors if they will not stand behind those claims with critically ill patients?

Crisis management can get somewhat complicated at times, but for the most part, common sense dictates the bulk of it.  BioMarin, and its CEO in particular, has gone off the rails in their response to the tens of thousands of people who have called on them to provide compassionate use to Andrea Sloan.  At this point, the source of the damage that is occurring to the reputation of the company is happening not because of the actions of those contacting the company, but because of the actions of the person who is supposed to be capably guiding the company.

In a situation like this, if I were advising the company as a Crisis Management consultant, I would go directly to the other board members running the company and suggest they sideline the CEO for the duration of the crisis and set forth in a new direction that is less damaging to their mission as a company.

Note: as of publication, the BioMarin PR department has not responded to a request for comment regarding the validity of these emails.

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Opinion Editorials

BioMarin reveals crisis strategy in callous “reply-all” as patient nears final days

BioMarin continues to be at the center of a crisis management nightmare as they deny a cancer patient a life-saving drug, but their strategy was unveiled as the CEO accidentally hit “reply-all” on an email, including the patient’s supporters he is seeking to avoid.

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Reply-all happens to the best of us

Everyone has hit “Reply-All” on an email by accident at one time or another. It is not often, though, that the CEO of a public company facing a full-blown media crisis emails his strategy to the people he is trying to avoid.

Last week I discussed the predictable crisis that BioMarin pharmaceutical company is heading toward and its ethical obligation to at least try to avoid that crisis. Since that article was published, BioMarin seems determined to prove me prescient.

It is difficult to imagine a company less prepared for a crisis of its own making as BioMarin circles its wagons to wage a media war against an ovarian cancer patient named Andrea Sloan who has only days to receive treatment.

This week, we will look a little deeper into the company and their CEO’s strategy revealed in his “Reply-All” email on which he included Andrea Sloan’s supporters, and which was subsequently provided to me.

A deeper dive into this CEO’s crisis “strategy”

As any crisis management professional will tell you, the best way to avoid a crisis is to plan ahead. Large companies with potentially dangerous products – like oil companies – regularly have intricate and well developed crisis management plans in place. Unfortunately, most small and medium sized businesses have no active plan. BioMarin is no small company, however, and the current issues they face are not new to the company.

A pharmaceutical company with over 1,000 employees located in offices all around the world, BioMarin has had over $500 million in revenue in the last twelve months. There is no excuse for this company, which focuses on developing drugs for rare diseases, to not have a plan in place for dealing with the problems they are most likely to face.

Earlier this year, BioMarin faced pressure in the UK when a 17 year old named Chloe Drury applied to be part of a trial as a last hope in her battle against cancer. The trial was arbitrarily limited to patients 18 years and older. Chloe was three months shy of turning 18 years old and her doctors and family approved of her use of the drug, but BioMarin forbade her inclusion in the trial.

Soon after her 18th birthday, Chloe passed away. Chloe’s mother is now leading a fight for new legislation to be passed in the UK that will help others in situations like that her daughter endured.

BioMarin faced some scrutiny because of that situation, so one would think that even if they had not had the foresight prior to the efforts by Chloe Drury’s family and friends to focus attention on their behavior, that afterward they would have gotten prepared in case a similar issue ever arose. The simplest solution would have been to develop a compassionate use policy with clear guidelines and a plan to be able to effectively communicate the policy and rules.

Instead, their promotional materials say that they support compassionate use policies – they just seem to very rarely actually implement them for patients. Compassionate use is described in this article in the Washington Times.

BioMarin’s CEO Jean-Jacques Bienaime is not a man of many words if this one email is typical of his normal communication, but his meaning is clear. After receiving an email from some of Andrea’s supporters to the executives in BioMarin imploring the company to establish a compassionate use policy, Bienaime hit “Reply-All” from his iPhone and apparently did not realize he included Andrea’s supporters on the reply. Let’s take a look at the three sentences he aimed at other leaders of the company on September 8, 2013:

reply

Why this reasonable response is unreasonable

While this argument may sound reasonable – the idea that BioMarin should point out that there are other drugs in this class available – in truth, this is a callous and calculated comment. The drug Andrea Sloan is trying to get from BioMarin is a PARP inhibitor that is thought to be her last chance against the precise type of cancer she has. BioMarin’s BMN673 is a PARP inhibitor that the company has been excitedly telling investors is a drug that is far more effective than other drugs in its category and safer for patients because it can be given in dramatically lower doses.

Because of the extensive, traditional treatment Andrea has faced in her battle against cancer since 2007, her body simply cannot tolerate other drugs on the market. Due to the results of trials BioMarin has touted to investors and scientific journals, Andrea’s doctor has indicated that BMN673 is Andrea’s best and possibly last chance. In extensive communication Andrea has had with the company, this set of parameters has been made clear.

The “Hank” to whom Bienaime addresses the first portion of the email is presumably Henry Fuchs, M.D, BioMarin’s Chief Medical Officer who is included on the email and who is well aware of the unique value of BMN673 to Andrea and that other drugs will not work. It is clear from the sentence, though, that Fuchs actually came up with the idea to spin the company’s response by telling others that Andrea can go find other drugs even though, as a doctor, he knows this is not the truth.

parp

The databases of ongoing trials are easily searchable and this statement either shows neglectful ignorance or a disregard of BioMarin’s own promotion of the results of trials of the drug and the unique way the drug could help Andrea Sloan. And while it is possible that the CEO of the company was simply unsure of the answer to this question, Dr. Fuchs could not be uncertain.

Enter the PR folks

The previous comment did seem to offer an optimist a glimmer of hope, though, until:

pr

Debra Charlesworth handles BioMarin’s public relations, but those relations are normally only aimed at potential investors and so far, the company’s efforts at dealing with local and national media on the issue of Andrea Sloan have proven horribly clunky and cold. Precisely the same, stock wording is used in canned responses BioMarin made to media inquiries during both Chloe’s and Andrea’s ordeals.

BioMarin recognizes that the intense media spotlight on their response to Andrea Sloan and the over 125,000 supporters she has amassed online is outside their current capacity of response and they had no plan for this event, which given their pattern of behavior, was entirely predictable. BioMarin has not spoken directly with Andrea, and instead of having their doctors talk to her doctor at MD Anderson, they had their lawyers talk to him. They have no apparent interest in resolving the issue in an ethical or practical manner, but instead have focused on spreading misinformation and spinning their position through an outside PR agency.

The answer is not hiring an agency

The fix to this problem does not lie in hiring a PR agency, but in fixing the problem which is causing the need to engage in public relations; and other companies should take note of that. And remember, public relations and crisis management are not the same. Besides, I have a hunch that there is a PR agency of about 125,000 people and growing who would be happy to go to work on repairing BioMarin’s image if they were to shift to an ethical behavior by developing a reasonable and functional compassionate use policy.

A KXAN News open records request showed that the FDA has approved 3,149 compassionate use requests over the last several years. The FDA only approves the drug once the pharmaceutical company has agreed to give it to the patient. So, in 3,149 recent cases, drug companies have said yes to patients in this situation. It is clear to no one why BioMarin has not.

Below: petition on Change.org calling for BioMarin to grant access to this life-saving drug that the FDA has approved for Sloan’s case
biomarin refusing care

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