Tylenol Case

“Medical malpractice occurs when a hospital, doctor or other health care professional, through a negligent act or omission, causes an injury to a patient. The negligence might be the result of errors in diagnosis, treatment, aftercare or health management.” (Admin) One of the most common type of claims that pharmacies face are negligence claims. Negligence is one of the categories that falls under the area of law called Torts. In the Hundley v Rite Aid case, a tort was filed for injuries that were sustained by Gabrielle Hundley after she took medication from an incorrectly filed prescription. The case involved a jury trial verdict involving Gabrielle Hundley, a minor child, against Howard Jones, the pharmacist, and the Rite

With access to prescription drugs, people are able to treat a multitude of diseases and illnesses. These drugs help deal with pain, inability to sleep, depression, and much more. Every day we are increasingly living in a world where there is better living through chemicals. However, what most do not seem to see is the rising tide of pain, illness, and ultimately death being caused by the pills people take every day. Most keep drugs in a special place in their minds, where they see them as harmless. Sadly, this is not the case, and in some cases our prescription drugs can be just as harmful as illegal drugs (King 68).

In order to discuss this case, it is also important to know about McNeil Consumer Healthcare, the subsidiary of Johnson & Johnson and the producers of famous medicine "Tylenol". Tylenol was their best selling product; it was very much trusted by their consumers and they also earned huge profits from its sales in United States.

The tragic deaths of seven people who died due to potassium cyanide-laced Tylenol capsules started as a disaster for Tylenol producer Johnson and Johnson. However, J&J communicated with their publics and the media proficiently, investigated their

The prescription drug epidemic has claimed thousands of lives every year after the introduction of Oxycontin. In 2007, the Pharma Purdue admitted in federal court that Oxycontin was not a “safe drug” and has a potential for abuse, causing them a fine of 634 million dollars (Andrzejczyk 272). However, at the time, it was too late for the people who become addicted to Oxycontin or who died from overdosing. The prescription drug epidemic had been already well established across the country. People already saw or experienced the euphoria induced by prescription drug.

This happened on two occasions, the first in 1982 and the second in 1986. These episodes could have been devastating to the McNeil company by drastic decrease in consumption of the Tylenol products. The McNeil company rallied to the situation to counter this possible decrease in consumption. According to "Laurels: The National Business Hall of Fame", Tylenol's share in the one billion dollar analgesic market commanded thirty-five percent of the market before the 1982 incident. At the time of these episodes, consumer trust was damaged and market share decreased to seven percent. By February 1983, Tylenol had regained a twenty-four percent share of the market(Diary of an Amazing Comeback). In the 1990's, Tylenol again reached its thirty-five percent of the market which at this time accounted for a two billion dollar market(Laurels: The National Business Hall of Fame, Fortune). By regaining their share of the market, this demonstrated that the consumers had faith in the McNeil company's ability to produce safe and trustworthy products, i.e. Tylenol, for their comfort and happiness.

Tylenol, an over the counter prescription product from Johnson & Johnson, was one of the top brands in the analgesic market. Within the company, it was also a large income earner that commanded nearly 15% of the company’s total profits. That being the case, the 1982 crisis was not only a big blow to the brand, but also to the company as a whole. The crisis jeopardized the company’s existence; putting at risk a multi million investment which the investors had a lot of faith in. Irrespective of whether the crisis was due to malicious acts from ill motivated criminals or not, the company had to act swiftly to counter the legal issues which were ensuing and mitigate huge impending losses. It was really a trying moment for the top management of Johnson & Johnson and more so to the CEO, James Burke, who faced the toughest test of his managerial career during this time. Though the crisis was amicably solved, there were some legal issues that were imminent and some valuable lessons learnt from the episode.

The problematic issue for Bristol-Myers was to position its new aspirin drug to the potential customers and decide a good price which can not only make it acceptable by the customers, but also give a fair profit to the company. In other words, the company had to formulate an effective marketing and promotional strategy for its new drug, Datril. The company was not merely willing to establish its new brand in the analgesic market; the main issue was to establish this new brand in the presence of a strong competitor, Tylenol.

The market for acetaminophen was growing at a rate of 5:1 to that of aspirin. Studies had shown that the side-effects from acetaminophen were less than aspirin. Bristol-Myers could have used the change in consumer consumption pattern and the shifting demand between the 2 analgesic variants as a means for positioning Datril using an effective campaign strategy.

One of the most important principles of running a business is honesty. However, Johnson & Johnson seem to lack this qualification. For example, Johnson & Johnson released an antipsychotic drug Risperdal in 1993[1]. It gained approval from the

Sealed bottles were tampered with and extra-strength Tylenol capsules were replaced with cyanide-laced capsules. These bottles were then resealed and placed on shelves of pharmacies in the Chicago area. Seven people died as a result. Tylenol was called upon to explain why its product was killing people.

In a competitive market to which Johnson and Johnson operates, the smallest of errors can lead to consequences which can cut revenue. When large mistakes occur, millions of dollars are lost, and even worse, there is a loss of customer confidence. Johnson and Johnson has had numerous recalls in their consumer healthcare division recently, which rocked the organization’s once sound image, and diminished its profits. These recalls have hurt Johnson and Johnson’s stocks and cost the company about $900 million in sales last year (Rockoff, 2011).

Pharmed First Inc. is a widely successful chain pharmaceutical company with 85 drugstores located in Canada’s Atlantic provinces. George Brenner is one of the 6 regional managers and Angela MacFee is a store manager in a mall located in Dartmouth. One of MacFee’s loyal customers have purchased 9 packages of Diet Magic on September 2011 however wanted to return them on May 2012. Subsequently, MacFee reacted hastily and defensively, arguing with Johnston in spite of Pharmed First Inc. return policy (Figure 1). As a result, Johnston wrote a letter to Frank Chen, the president of Pharmed First Inc. and told Brenner to deal with it. He proposed that the company gives Johnston a $500 voucher and that MacFee apologizes. However, MacFee remained inflexible as she also challenged Brenner’s authority.

What was at stake for the key parties, including those who disagree with you? Consumers: Death, Johnson & Johnson, image, profit, shareholders, board Who were the key stakeholders? The public, Burke, employees of Johnson & Johnson, retailers, suppliers, the families of those who died What arguments were you trying to counter? ????? That is, what rationalizations did you need to address? Wait and see, don’t do anything yet. It is only in Chicago, not a national emergency. What responses to those reasons and rationalizations were most powerful and persuasive? Burke acted quickly and with confidence. Johnson & Johnson set the tone for how a company should respond to a crisis. Did you have all the information you need to craft a sound argument? Yes To whom was the argument made? The public via media, shareholders, executives At what times did your target audience have a change of heart? Burke removed all product from shelves nationwide during the second Tylenol incident What did you learn from this? The rapid action of Johnson & Johnson was a wise move. The decision not to reintroduce the product until something was done to provide a safer product was prudent. What timing was optimal? Every move made by Burke during this crisis was optimally timed. Should your efforts have been sequenced in another way? No Which allies, if any, helped you make your case? The media was pivotal in communication of the Tylenol crisis.

an unknown suspect put 65 milligrams of deadly cyanide into Tylenol capsules. It was assumed