By Steven DiJoseph
No sooner had the ink dried on a Wall Street Journal report that Bausch & Lomb had learned of eye infections linked to its ReNu With Moisture-Loc from Hong Kong health officials in November 2005, than the timeline was moved backward yet again.
While Bausch & Lomb claims that the November time frame was the very earliest it knew of a potential problem, it now seems that, once again, the company may have been guilty of the cardinal sin of product recalls, delay and misinformation by the manufacturer.
The number of suspected or confirmed cases of Fusarium keratitis fungal eye infections in the U.S. has risen to 186 in 29 states according to the Centers for Disease Control and Prevention (CDC).
According to the FDA: Ã¢â‚¬Å“Microbial keratitis is a severe infection of the cornea. Risk factors for infection include trauma (generally with plant material), chronic ocular surface diseases, immunodeficiency, and rarely, contact lens use. There are an estimated 30 million soft contact lens users in the United States; the annual incidence of microbial keratitis is estimated to be 4-21 per 10,000 soft contact lens users, depending on overnight lens use. Fungal keratitis is a condition more prevalent in warm climates; in the southernmost United States, fungal keratitis comprises up to 35% of microbial keratitis cases compared with 1% in New York. The proportion of fungal keratitis due to Fusarium spp. also varies by region, from 25-62%.Ã¢â‚¬Â
Bausch & Lomb first stated February 18, 2006 was the earliest indication that there may be Ã¢â‚¬Å“an unusual occurrence with this infection.Ã¢â‚¬Â That date, however, was somewhat misleading; however, since Hong Kong health officials had admittedly told the company in November 2005, that they had “noted an increase in hospital admissions due to <"http://www.yourlawyer.com/topics/overview/renu_contact_solution">contact-lens-related keratitis from June to September 2005.”
The company claimed that nothing in the November contact with Hong Kong authorities, or the investigation being done at the time, seemed to require further action since no definitive link had been made between its product and the Ã¢â‚¬Å“spikeÃ¢â‚¬Â in Fusarium infections.
Now, however, Reuters is reporting that the Hong Kong government Ã¢â‚¬Å“alerted Bausch & Lomb Inc. to eye infections in users of its contact lens solution in September 2005, way before the company withdrew its product in February this year.Ã¢â‚¬Â (Reuters 4.27.06)
According to this latest report, Hong KongÃ¢â‚¬â„¢s Health Department had detected the spike in Fusarium cases in July and August and, as a result, had conducted tests of the eye solution.
Although no link had yet been made in September, this latest revelation clearly indicates that there was certainly a reason for the manufacturer of an eye-related product to take more than a passive role once and eye-related problem was detected in users of that very product.
Although Bausch & Lomb reported the Hong Kong Ã¢â‚¬Å“incidentÃ¢â‚¬Â to the FDA in December 2005, its report stated that “no causal factors can be determined and no conclusion can be drawn.” That optimistic appraisal of the situation would not have sounded a warning in the U.S. It also may have lulled Bausch & Lomb into a false sense of security regarding the safety of its product thereby delaying its response to the problem when it finally burst onto the scene earlier this month.
In any event, the shifting timeline cannot be a good thing for Bausch & Lomb for a number of reasons. As we have previously reported, when pharmaceutical products are linked to adverse reactions, serious side-effects, or contamination, a manufacturerÃ¢â‚¬â„¢s immediate reaction to the problem is often the most critical factor in assessing whether the Ã¢â‚¬Å“crisisÃ¢â‚¬Â was managed correctly.
Many perceptions, inferences, and consequences are directly related to the effectiveness of the initial steps taken by any company once the safety of one of its products is brought into question.
The old adage Ã¢â‚¬Å“you only get one chance to make a first impressionÃ¢â‚¬Â applies with particular force to these situations for the following reason, among others:
The companyÃ¢â‚¬â„¢s perceived concern (or lack thereof) for the safety of the public in general, and its own customers in particular, will be largely defined by the speed and scope of its reaction to the crisis.
A quick and decisive reaction will usually serve to boost confidence and trust in the company, while slow or evasive actions will only generate mistrust and second-guessing.
Immediate steps to address the crisis will unquestionably save additional injuries or deaths. Thus, immediate voluntary recalls are always seen as responsible gestures. Such actions are expensive, but it is money well spent in terms of damage control. Forced recalls dictated by government agencies or court orders are extremely damaging to a companyÃ¢â‚¬â„¢s image.
Any perceived delay or deception in dealing with a product-related crisis can do irreparable (or, at the very least, long-term) damage to a companyÃ¢â‚¬â„¢s reputation and sales. It may also have a spillover effect on the companyÃ¢â‚¬â„¢s other products even though they are not involved in the problem and remain perfectly safe.
A companyÃ¢â‚¬â„¢s initial reaction to a crisis will unquestionably find its way into any subsequent litigation related to it. Quick, decisive, and thoughtful actions will serve as strong defensive statements, while a slow, evasive, and self-serving approach will provide the plaintiffs with a powerful weapon against the company involved.
Unless there has been some illegal or otherwise improper conduct, an immediate response that effectively addresses the problem will usually stave off monetary penalties and punitive measures by regulatory authorities.
Dealing with a crisis in an open and effective manner will avoid recriminations within the company and circumvent such internal problems as stockholdersÃ¢â‚¬â„¢ derivative lawsuits.
In the case of Bausch & Lomb, crisis management experts and business analysts have pointed out that, while the companyÃ¢â‚¬â„¢s actions have all been exemplary, the delay in their implementation was inexcusable and therefore highly damaging to the companyÃ¢â‚¬â„¢s overall image, stock value, and sales of other unrelated products.
As the timeline is moved further back, the missteps by the company take on more significance and do greater damage to its image and credibility.
As we have previously reported, Bausch & Lomb had always been regarded as a reputable consumer-product company specializing in eye health and perfecting vision.
During its 153-year history, the Rochester, New York, the company has gradually become a highly visible and respected healthcare brand worldwide with annual revenues of over $2 billion from sales in over 100 countries where it employs some 13,700 people.
The companyÃ¢â‚¬â„¢s product line has changed over the years as eye care has advanced. Currently its core businesses include soft and rigid gas permeable contact lenses, lens care products, and ophthalmic surgical and pharmaceutical products.
Thus, it has come as somewhat of a shock to industry experts and consumer advocates that Bausch & Lomb has found itself in the middle of a rapidly-growing controversy concerning the safety of one of its widely used contact lens solutions, ReNu with MoistureLoc,
The difficulties have seriously affected Bausch & LombÃ¢â‚¬â„¢s stock value. Shares of the companyÃ¢â‚¬â„¢s stock dropped 17.3% on the day after it voluntarily suspended shipments of the affected product.
Although the infection issue is serious enough in terms of finding out why it has occurred, the perceived failure by Bausch & Lomb to take immediate corrective action in terms of a recall or warning blitz is becoming even more of a problem for the company.
While the company maintains that it reacted quickly and decisively in the matter, the perception is that it did not. The revelations that these problems were developing since as early as July 2005 as the Fusarium infections began to appear in Hong Kong is troubling to say the least.
Bausch & Lomb claims it contacted the Centers for Disease Control as soon as it learned the infection had appeared in Singapore, and suspended sales of ReNu With MoistureLoc in Singapore and Hong Kong in February. The company also notes that on March 31, it issued a press release advising of the testing it was doing to ensure that quality had not been compromised at its South Carolina plant.
Crisis management consultants, however, see the facts a bit differently. They believe Bausch & Lomb would have been well-served by recalling the product immediately upon release of the CDC warning.
While some retailers followed that path, the manufacturer did not. The hesitation allowed the product to remain on the market for a considerable length of time when it should have been already on its way back to the company.
The delay in launching an all-out media bombardment containing warnings and safe eye-care procedures has also been seen as a problem for the company. While government agencies reacted to protect the public as soon as they could, Bausch & Lomb could have done so much sooner given its immediate knowledge of the Asian cluster of what is normally a very rare infection.
One attorney we spoke with, who is heavily involved in pharmaceutical litigation, stated: Ã¢â‚¬Å“Pushing the timeline backwards is not a good thing for any company. ItÃ¢â‚¬â„¢s not helping Merck in the Vioxx litigation and it wonÃ¢â‚¬â„¢t help Bausch & Lomb either. As the date a company knew, or should have known of a problem is pushed back, it is less likely that the FDA, the public, or a jury will absolve the company of responsibility or excuse its belated warnings or recalls.Ã¢â‚¬Â
The attorney continued: Ã¢â‚¬Å“ In this case, once Bausch & Lomb, a manufacturer of eye-care products became aware that a rare eye infection was occurring with unusual frequency in people using one of its products, alarm bells should have starting ringing and warnings should have been issued to the public, healthcare professionals, and the FDA. In addition, a recall contingency plan should have been put in place so that it could be implemented at a momentÃ¢â‚¬â„¢s notice. Bausch & Lomb may have simply fallen asleep at the switch, but the perception will be that it dragged its feet intentionally hoping to avoid any liability if the problem just went away.Ã¢â‚¬Â