Archive for September, 2009

The Sequenom Case: In Crisis PR, No-Hype and No-Spin Should Prevail

Wednesday, September 30th, 2009

Posted by Tom Gable

Can authentic no-spin PR, even in a crisis, help a company maintain a semblance of credibility, protect its reputation on the downside and set a vision for the future that even supports its stock price?

Sequenom Inc. in San Diego won’t know. On Monday, it issued a news release via PR Newswire with the headline: “SEQUENOM Announces Completion of Independent Investigation.”

The lead paragraph:

SAN DIEGO, Sept. 28 /PRNewswire-FirstCall/ — SEQUENOM, Inc. (Nasdaq: SQNM) today announced the completion of the independent investigation by a special committee of independent directors related to the test data and results for the company’s noninvasive prenatal test for Trisomy 21 (Down syndrome). The independent counsel engaged by the special committee interviewed over 40 witnesses and reviewed over 300,000 documents and emails.

Okay, so what’s the issue? Buried in the fourth paragraph is the bottom line of the investigation:

The company has terminated the employment of its president and chief executive officer, Harry Stylli, Ph.D., and its senior vice president of research and development…obtained the resignation of its chief financial officer…and one other officer… (and) also terminated the employment of three other employees. While each of these officers and employees has denied wrongdoing, the special committee’s investigation has raised serious concerns, resulting in a loss of confidence by the independent members of the company’s board of directors in the personnel involved.

How did the news media play it? Here are the headlines and first paragraphs from stories in the San Diego Daily Transcript, San Diego Union-Tribune and Xcomony.

Sequenom fires CEO and others after investigation (SDDT)

Sequenom Inc. says it fired its CEO and its research chief following an investigation into the mishandling of test results for its Down syndrome blood test. A total of four executives and three other employees were terminated or resigned, the company says.

… Sequenom said Harry Hixson Jr., 71, a member of its own board and a former president and chief operating officer of Amgen Inc. (Nasdaq: AMGN), will take over as interim CEO. Another board member, Ronald Lindsay, 61, will be interim CFO, and controller Justin File, 39, will be the principal financial and accounting officer.

…Sequenom’s (Nasdaq: SQNM) SEQureDx test, which screened maternal blood to discover Down syndrome in fetuses, was on track to reach the market in June until the company disclosed in late April that study data had been “mishandled” by employees. That made the data unreliable and lead to delays, hammering the San Diego company’s stock price.

Sequenom ousts CEO, other execs (Union-Tribune)

The San Diego biotechnology company Sequenom said yesterday that it has ousted its CEO and several other executives after an investigation into the mishandling of study data.

The discovery of the data problems in April led the company to postpone the launch of the test and to suspend four research and development employees. The test remains on hold, though the company has not disclosed specifically what went wrong…Now the company says the public should not rely on any of its previously announced data for the test, and it is not disclosing a timetable for development of eventual commercialization.

Sequenom Shares Tank After Executives Ousted Over Data Mishandling (Xconomy)

Sequenom shares plummeted 44 percent today in after-hours trading after the San Diego-based company said it has ousted CEO Harry Stylli and its head of R&D in the wake of an investigation into mishandling of data for its prenatal genetic test for Down Syndrome.

Sequenom shares fell $2.50, or 44 percent, to $3.20 in after-hours trading after the conference call. That’s a painful free fall for investors who bought last year on the enthusiastic news about Sequenom’s test, which drove shares up to $27.76 the day after the original announcement on Sept. 23, 2008.

How could this have been played differently by the company, to perhaps better results? One has to avoid the attempt to try short-term spin and think strategically about rebuilding credibility and creating a foundation to recover long-term reputation and valuation.

On positioning for the future, Hixson has impeccable credentials and credibility. During a conference call, he said the company is instituting new disclosure controls and procedures on all fronts, launching training in ethics and scientific processes and adding a new science committee on the company’s board of directors to oversee its research and development strategy and activities – definitely a positive direction.

The company said the data problems appeared to be confined to the Down syndrome program. It recently launched a separate test to identify parents with increased risk of having babies with cystic fibrosis, so is not a one-compound wonder, as happens with many biotech companies. The cystic fibrosis data, handled by a different unit than the one handling the Down syndrome data, has been validated by outside third-party collaborators. In addition, Hixson said the company still believes it has a valid approach to the detection of Down syndrome through genetic analysis of maternal blood. He said the company hopes to maintain its collaboration with Oxford University researcher Dennis Lo, who licensed his intellectual property to Sequenom for developing and commercializing its prenatal test.

He told the media that he and Lindsay were currently in the midst of strategic planning for the coming year and setting new priorities, with more to come as they get into it.

“We are determined to emerge from this experience stronger,” Hixson told the media.

What could have Sequenom done differently? One approach is to like a news organization rather than an attorney. How will the news be played? Then, be aggressive and pro-active in telling its story and making a few major points:

  • Sequenom has completed an independent investigation of issues involving the mishandling of data and release of results that were not accurate
  • As a result, the board has fired its CEO and removed others in top management and units involved with the mishandling
  • The company and its technology are sound Harry Hixson, former president of Amgen and a board member, is taking over and has announced plans to move forward aggressively in correcting internal issues while also continuing to pursue important research
  • The mishandled data related only to the Down syndrome studies and not to a promising study in identifying parents whose children could be prone to cystic fibrosis
  • The new Sequenom team will be doing all it can going forward to rebuild trust in the company, its people and the promise of its technology and research

Admittedly, there are issues with an ongoing SEC investigation and the raft of class action law suits that will follow, requiring some legal scrutiny of all communications and news releases. But being more candid from the outset and NOT burying the news in the fourth paragraph would probably have enhanced company credibility, started rebuilding trust and shored up the confidence of some investors by setting a vision for future change and, perhaps, success.

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Posted in Authentic PR, Client Service Results, Crisis PR, Horizon Management, Hype Free PR | 1 Comment »

Newspaper Web Sites: More News, Faster; PR Opportunities Abound

Wednesday, September 23rd, 2009

LA Times Home Page

LA Times Home Page

Posted by Tom Gable

BIOCOM hosted a panel discussion today on “Social Media 2.0,” with Terri Somers, BIOCOM director of communications and former Union-Tribune life sciences reporter as moderator. The panelists: Mauricio Minotta, Director of Communications, The Salk Institute; Peter Pitts, partner and director, Global Health, New York, Porter Novelli; and Shari Roan, life science reporter for the Los Angeles Times.

The most compelling insights for the PR profession came from Roan. In a few minutes, she provided an incredibly succinct description of where newspapers are going in evolving from old to new models and incorporating social media to drive change:

  • The Web site is now their main product, not the print edition.
  • Most readers come from the Web.
  • As a result, the L.A. Times now reaches broader, more diverse audiences.
  • The Web site has 10 to 15 times more content than the print edition, which has its obvious production and distribution limitations.
  • They have more than 100 blogs, so can cover issues and ideas that wouldn’t typically get into the newspaper because of the size of the news hole.
  • With blogs, there are more opportunities to tell your stories and also stimulate comments, which help gauge public interest.
  • The blogs provide short snippets of news and are not fully reported out. They try to be fast in getting out the news and then provide links to stories or sources with more detail.
  • The beat reporters, such as those in sports, use Twitter to provide up-to-the-minute coverage. This has been valuable in covering breaking news, such as the recent fires near Los Angeles.
  • Twitter is used to Tweet on headlines and link back to the Web page.
  • Social media has made journalism more of a two-way street; they can engage with readers.
  • With an unlimited news hole on the Web, there is a greater need for visuals, including video.

Thanks to Roan for these important insights, including the latter. PR professionals, many of whom came out of print journalism (including yours truly), tend to think in terms of the printed word. Creating a visual communications strategy with Web sites, Facebook, You Tube, Flick, Twitter and all other tools and tactics can provide new power to any program, particularly those with difficult stories to tell in print but that can be covered in a three-minute video.

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Posted in Authentic PR, Brilliant Counsel, Client Service Results, Clutter Busting, Hype Free PR, Leverage, Social Media | Comments Off

Politics, PR and Promotion: When is it good for business?

Thursday, September 17th, 2009

Attention Companies

Attention Companies

Posted by Erin Koch

As a rule, most companies, from small storefront shops to multinational corporations, try to avoid the appearance that they favor one political viewpoint over another … and with good reason.  If I am a strong supporter of Candidate A, and I see a sign for Candidate B in the window of my regular dry cleaner, I might choose to have my shirts pressed elsewhere.  Likewise, if I am a supporter of progressive causes, but learn that the former CEO of a nationwide pizza company gave millions to conservative groups, I might order my pepperoni pie from a competitor.

So, most businesses remain (publicly, at least) neutral, rather than risk alienating half of their customer base.  Two well-known companies recently contradicted this apolitical strategy – with very different results.

Since it was sold to a major food company in 2000, ice cream maker Ben & Jerry’s has worked hard to maintain its image as a progressive, forward-, and free-thinking company.  Earlier this year, the company renamed one of its ice creams “Yes Pecan” to honor Barack Obama’s swearing in as President (a play on his campaign slogan “Yes We Can”.)  Then earlier this month, the company renamed its popular “Chubby Hubby” flavor “Hubby Hubby” to commemorate the fact that the state of Vermont legalized gay marriage.  (That new name will only be used in Vermont.)

While some may be annoyed at the ice cream maker’s partisan spin, I think their strategy is sound.  Why?  Because it remains authentic to their brand and their core principles.  Their loyal and generally liberal customers will probably love it.  And they’ll get lots of media attention, which means more mindshare and the potential for more customers.  (My favorite flavor is chocolate fudge brownie and, come to think of it, I haven’t had any in quite a while!)

A contrary example comes from similarly progressive mainstay Whole Foods.  Company CEO John Mackey wrote an op ed that was published in The Wall Street Journal critical of President Obama’s health care plan.  The resulting reaction has included storefront protests as well as a growing “Boycott Whole Foods” group on Facebook (now approaching 34,000 members).  There has even been speculation in the financial media that the CEO was going rogue, and acting based on his personal beliefs rather than what is best for the company.

While I certainly agree with John Mackey’s right to self expression, I don’t think the critical op ed was a wise move from a reputation management perspective.  Given the company’s progressive and politically active customer base, voicing a personal opinion that likely runs contrary to what most of his core customers believe could have been strategically misguided, leading to long-term damage to the brand image.

In sum, taking a highly visible political stand is almost always risky, particularly if (as for most companies) “being political” is not part of your corporate reputation and image.  But if you do find your company thinking about making such a leap, look first:

  1. Who is in our customer base and what will they think of this?
  2. Does this align with our core values and principles?
  3. What are the short term risks and benefits?
  4. And what are the long term risks and benefits?

Photo credit: zoovroo

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Great coverage, fatal PR? The Algae-Fueled Hypemobile Rolls On

Tuesday, September 15th, 2009

Tricked out Hypemobile

Tricked out Hypemobile

Posted by Tom Gable

Gable PR works with several renewable energy clients, participate in clean tech and other organizations and our teams are always watching for good news on advances in technology that can help wean our world from its addiction to foreign oil.

Last week, our news trackers picked up the announcement of what appeared to be a great concept – a cross-country tour to promote the use of algae as a source for fuel to power automobiles. This could create what some PR professionals refer to as “rolling thunder,” where you launch something and watch the results roll across the country making big noise at every stop, with awareness and reputation building accordingly.

Unfortunately, this particular trip may be producing an ill-wind along the way (some cynics might use more descriptive and colorful terms). To start you on the journey, here are the first two paragraphs of the news release announcing the tour from the Sapphire Energy Web site:

“Veggie Van Organization and the FUEL Movie to Unveil the Algaeus”

Los Angeles, CA (August 27, 2009) – Green Fuel is real fuel as the Algaeus, the world’s first plug-in hybrid vehicle to cross the country on fuel containing a blend of algae-based renewable gasoline, hits the road to celebrate the launch of the award-winning film FUEL. Sponsored by the Veggie Van Organization, the eco-aggressive, 10-day cross country tour features a caravan of high technology ‘green’ vehicles, led by the groundbreaking Algaeus, which is fueled by Sapphire Energy. The tour kicks off on September 8 in San Francisco and culminates in New York City on September 18 to celebrate the nationwide premiere of FUEL, the movie that inspires green energy solutions such as those demonstrated on the tour.

Sundance Film Festival Winning Director of “FUEL” and Founder/Co-Director of Veggie Van Organization, Josh Tickell, says of the big news, “What better way to show that the energy solutions we have been waiting for are here than driving the world’s first algae fuel powered, 150 mile per gallon, plug-in-electric hybrid vehicle across America to celebrate the opening of a movie about a new green economy.”

What better way, indeed, until one starts probing into the facts of the case and the details of the car, a converted plug-in Prius; the deal is 95 percent hype and 5 percent reality.

The hype: using just 25 gallons of fuel to cross the country in the hybrid electric vehicle with just 5 percent of that algae-based fuel, or 1.25 gallons. The trek started with the unveiling of the car in San Francisco on September 8. For the 1.25 gallons, Tickell and his FUEL promotion team and Sapphire Energy achieved incredible media mileage, garnering attention from environmental bloggers, television and print media. Then, critical comments started popping up on multiple renewable energy Web sites and blogs. Here are a few highlights:

  • Well it’s not getting across the country by algae; it’s getting 5% of the way across the country by algae.
  • I suppose a publicity stunt is what is needed, but there are a lot of deceptive words in the press release…Because of the ethanol mandate, it could have more corn ethanol than algae fuel, yet it’s touted as being powered by algae…Why not call it the Cornius?
  • The car could probably succeed on 5 percent Mazola oil or recycled cooking oil from the McDonald’s deep fryers along the way. Does this really prove anything scientifically? It’s just a promotion from the Fuel movie and the media are going along for the ride.
  • So, a plug in hybrid, that utilizes a 5% algae gasoline mix will go coast-to-coast on only 25 gallons of fuel! So, what that means is that this vehicle and this publicity stunt, will be running mostly off of plug in power and good old fashioned gasoline. What that means kids, is that, the primary fuel being used for this little escapade is gasoline! 23.75 gallons of it, to be exact. The secondary fuel will be coal! Coal fired power plants will generate electricity which this vehicle will steal from hotels across the nation.
  • 0.5 gallons of algae fuel per tankful. At that rate, you could put that much water and an emulsifier in the tank and claim that the car runs on water!
  • The economy comes from the fact that it is a P-HEV, not from the fact it runs on algae ethanol…The overwhelming majority of the energy for this trip comes from oil based gasoline and electricity from a high carbon grid. Still fuel efficient, no contest there, but (it is) no more efficient or exciting as any other P-HEV on the road, except for the paint job. GREENWASHING!!!
  • If they’re going to use just 5% algae in the fuel, fine — but then they shouldn’t claim that the car is “powered by green crude” and paint a big “powered by ALGAE” sign on the side.
  • We need real green tech, not phony marketing ploys. This stunt could do more to discredit green technology than promote it. Some people will look at this, find out the truth, and conclude that biofuels are a hoax. Sad, because biofuels are actually a good idea that just hasn’t quite arrived yet.
  • I like the comment about substituting the algae fuel for the same amount of water and you call the car the Aqua-us!
  • How stupid do these PR brats think the public is? This…is all about drumming money out of gullible investors along the way, not about saving energy or the planet.
  • Seems to me that the Josh Tickell polluting the green movement are the reason that any viable “green fuel solution” is still well beyond the horizon…It would be real interesting to hear T. Boone Pickens’ take on this cross-country charade.

For further details, check the sponsoring Veggie Van organization Web site, which almost looks like a put-on. Its mission is “to facilitate the transition from fossil fuel use toward a new green economy by educating people about sustainable energy and providing them with appropriate pathways for integrating sustainable energy into homes, schools, communities, cities, states and ultimately nations.” The main vehicle for doing this (other than the colorful and media-friendly vehicles in its fleet) will be “to create a green curriculum that is nationally accredited for K-12 and to make available, free of charge, a 35 minute educational version of ‘FUEL’ to every school in the United States.”

The bottom line: generating more promotion for the movie and not much action in supporting the somewhat fuzzy mission statement. It will be interesting to see how the media react when the Hypemobile arrives in New York City on Sept. 18 for the theatrical launch and press event.

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Posted in Authentic PR, Client Service Results, Clutter Busting, Hypemeister Honor Roll, Social Media | 3 Comments »

No Room for Speculation: Accuracy in Crisis PR is Vital

Tuesday, September 8th, 2009

Treat a Crisis Seriously

Treating Your Crisis Seriously?

Posted by Erin Koch

One of the most vexing aspects of crisis communications is the need to overcome the natural human instinct to explain, justify, shift blame, or otherwise make sense out of the chaos that occurs when things go horribly awry. On Wednesday, Sept.2, news broke that a hot creative agency had released a tasteless advertisement exploiting fears and memories of 9-11. You can see the print ad here. A video version (which may not have been created by the company that made the original print ad) can be found here.

The World Wildlife Fund, the conservation group whose logo appears with the ads, immediately denied having ever approved the ad, placing full blame for the fiasco on its ad agency, DDB Brazil. Our initial reaction was that this was good crisis management. It is always wise to get out in front of a story and quash rumors that might harm an organization’s reputation. Then on Thursday, Sept. 3, various media reported that the WWF may, in fact, have approved the ad. And it had even appeared in a small Brazilian publication. A second statement released by the WWF makes this clear:

WWF Brazil has subsequently issued statements that have raised doubts about whether the ad concept was approved at some level within the WWF Brazil organization.

Thus WWF now finds itself in an even tougher crisis communications quandary: the appearance that they either did not do their due diligence in investigating the genesis of the ad, or (worse) intentionally tried to cover-up their responsibility for the ad. A comment at the end of an AdWeek blog post on the crisis sums up WWF’s new communications problem quite succinctly:

  • So, what’s worse? This disgusting and insulting ad being produced or the fact that differing branches of the WWF have no knowledge of what the others do, let alone any institutional control over the entity as a whole.
  • Way to set conservationism back 10 years. Maybe you should stick to actually helping protect the planet versus trying to use advertising to convince people “it’s powerful” … um, duh.

On the first day of the crisis, somewhere, someone at WWF headquarters asked the question: Did we approve this ad? And the answer they received (not surprisingly, given the high stakes involved) was a reassuring, “No, we did not.” But that question should have been asked again. And again. And then rephrased and asked a few more times, such as a very straightforward “well, then where did it come from and why does it have our logo on it?” Key WWF team members should have been given some time to search through their e-mail archives for the process of ad development and anything resembling an approval. Only then, should the conservation organization have gone public with a denial.

A few years ago, I was on the receiving end of the initial “we’d better call our PR firm about this” call for an angel of death healthcare crisis. A healthcare company had discovered that one of its employees had been injecting an unknown substance into its patients’ IV lines. You can read a bit more about the case here. I had to ask my first question literally five different times before I got a comprehensive answer: “Have you informed the rest of your patients about this?” I knew that absolute accuracy on this one point was crucial: every communication going forward would be focused on how … and how quickly, the company had reacted once it suspected the worst.

Lessons to be learned? In crisis communications, three things are crucially important: truth, accuracy and speed. In that order.

(Click here for Gable PR’s full crisis communications checklist or for direct contact please email us at results@gablepr.com)

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Journalists Take Umbrage at Being Profiled by PR Firms; a Double Standard?

Thursday, September 3rd, 2009
090719-M-0440G-568

Embedded and Profiled

Posted by Tom Gable

The recent media feeding frenzy over the Pentagon hiring a PR firm to profile the work of journalists applying to be embedded with the troops in Iraq and Afghanistan is tinged with irony.

The story broke in Stars and Stripes, which reported that The Rendon Group had been hired to examine individual reporters’ recent work. It would then determine:

“…whether the coverage was ‘positive,’ ‘negative’ or ‘neutral’ compared to mission objectives, according to Rendon officials.”

Follow up stories in Wired and elsewhere complained about the military trying to shape coverage. The Wired coverage also quoted Paul McLeary at Ares, a defense industry blog, who wondered if the reaction was overblown. “While a bad move on the military’s part, I don’t see the Rendon contract as being as insidious as some would have it,” he wrote.

Several writers soon blogged indignantly about the experiences and included excerpts from their profiles. This self-aggrandizement seems to be somewhat of a double standard. It’s okay for the media to probe as deeply and broadly as they would like for information on others, but not for others to probe into their bodies of work?

The best journalists dig deeply before they interview anyone and check sources and resources afterward to make sure they have it right. In a similar vein, professional PR people should know where a journalist is coming from before they show up to interview the client or organization spokesman. Whether it’s a technology, financial, personality, lifestyle, investigative or any other type of piece, a quick search of the archives can determine how the writer approaches his or her work and what to expect.

  • Are they thorough and balanced, or do they have a history of doing hit pieces?
  • Are they more interested in human stories, finance, technology?
  • Have they ever covered this niche before?
  • How long have they covered the niche and do they have a degree or advanced degrees in the field?
  • How much background or technology briefings do they need in advance?
  • What outside resources can we point them to for more background?
  • When the story finally runs, what is the headline or soundbite?

As a former financial journalist and correspondent for Stars and Stripes, I can attest that controversy sells. Investigative pieces generate far more interest than positive features on achievements by an individual or organization. One reporter who blogged about being profiled probably got more attention from his posting about the Pentagon controversy than he has had from any previous piece in traditional media or social media. And one wonders if he was happy that the Pentagon fired The Rendon Group seemingly in response to the feeding frenzy.

Agreed, the military or any other government agency shouldn’t reject a reporter from legitimate media outlets from being credentialed to cover the war, the White House or anything else. In any work with journalists, be professional. Search the archives, understand where they are coming from, of course, and then help them to do their job in every way possible.

I liked Tom Ricks in Foreign Policy who said: “The Pentagon is checking out journalists. So what?” Plus, his photo is more provocative than most. Check it out!

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Posted in Authentic PR, Brilliant Counsel, Client Service Results, Crisis PR, In the Beginning | 2 Comments »