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Abstract

Mylan: Balancing Profitability and Public Approval in the Digital Age

Harris, T., Keddington, T., O’Rourke, J. S. (editor)
January 17, 2018
SKU:
BUS-004044
Region: 
North America
Topic: 
Strategy & General Management, Ethics & Social Justice
Length: 
7 pages
Keywords: 
Brand Management, Corporate Culture, Crisis Management, Customer Communication, Customer Relations, Ethics, Financial, Investor Relations, Media Relations, Pharmaceutical
Student Price: 
$4.00 (€3.63)
Average rating: 
5
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 offering, etc.) A month later, Mylan was still struggling to silence its critics. Why did Mylan’s responses fail to silence the critics? 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. 5 pp. Case # 17-04.

Reviews

Rating: 
5

I like to tie this case to two other price hikes: A competitor to Mylan, Kaleo, sells both an epinepherine auto-injector (AUVI-Q) that gives voice instructions AND a similar concept for Naloxone, called Evzio, which can save people from an opiod overdose (there's an outstanding Leslie Stahl 60 minutes piece from November 2018). Both are insanely overpriced. Students tend to be even more familiar with Martin Shkreli (there's a great episode of the podcast "American Greed" on him) who raised the price of a life-saving drug from under $15 a pill to over $750 a pill. Those additional examples paired with this Mylan case really help probe students' arguments, particularly about the ethics of charging based on what consumers are willing to pay in matters of life and death. The voice-instructions undeniably add value for certain populations who may be anxious or unable to read standard instructions in an emergency. I like to press students on what other ways the firms could seek to add value once their patents run out and generics become available. Overall, the competitive environments in each of these scenarios must be reflected on to understand the product positioning and the perceived value of generic vs. name brand. The underlying ethical themes make this case a keeper.

Rating: 
5

Mylan: Balancing Profitability and Public Approval in the Digital Age is a case that really brings up issues about Corporation's Social Responsibility to provide consumers with products that they need at a reasonable price. This Mylan case makes you think about business from the perspective of a business owner and a person that needs something that they may not be able to afford. This case offers a lot of information and insight about the pharmaceutical industry.