This isn’t the first time Mylan chief executive Heather Bresch has been under fire.
Bresch, who started out in a low-level position in quality control at one of the company’s factories, is the first female head of a large pharmaceutical company. She made a name for herself by turning the EpiPen – once an obscure injection device for allergy sufferers that she calls her “baby” — into a blockbuster billion-dollar drug. But the 47-year-old has found herself in the hot seat in recent weeks as consumers and lawmakers have expressed outrage over the rising cost of the drug and have called for investigations into the company’s pricing practices.
While the mounting attacks may be enough to unnerve even the hardened chief executive, Bresch has a longer history than most of dealing with such issues and coming out (mostly) unscathed.
In fact, Fortune, in a tough profile, once described her career as being full of “ethically messy mishaps and public relations gaffes.” At least two involve her own father, Sen. Joe Manchin III, D-W.Va.
The most scandalous incident occurred in 2008 shortly after she was named the company’s chief executive and involved the master’s degree in business administration from West Virginia University that was listed on her resume. It turns out she never got it. An investigation by the school, prompted by a newspaper report, found that some administrators had added courses and grades to her transcript to make it look as if she had completed the required coursework.
The incident made headlines across the state because her father was governor at the time and the school’s president, Mike Garrison, was a longtime family friend and former business associate.
The controversy blew over quickly for Bresch, and she remained chief executive, but Garrison and a slew of other administrators resigned from their positions following expressions of no confidence from students, faculty and alumni.
In 2015, Bresch caused another firestorm when she merged Mylan with a company in the Netherlands. The transaction is known as a “tax inversion” and involves joining with a foreign entity to move a legal corporate headquarters abroad. Doing so provides a major advantage: trading U.S. corporate taxes, which at 39 percent are among the highest in the world, for a tax bill from a different country that is presumably less.
Such moves are so unpopular with the American public that only a handful of U.S. companies have attempted them. Members of Congress – including her father – denounced such tactics as undermining the U.S. economy.
Then there’s the matter of Bresch’s salary and other perks, which are unusually high, even in this era of crazy compensation for company executives.
“EpiPen prices aren’t the only thing to jump at Mylan,” NBC News reported. According to Securities and Exchange Commission filings, Bresch’s total compensation went from $2,453,456 to $18,931,068 from 2007 to 2015. That’s a striking 671 percent increase. That period coincides with the time when Mylan acquired the rights to EpiPens and steadily hiked the average wholesale price from about $55 to $320.
A standard 2-pack now costs between $600 to $700. The price has prompted outrage among many consumers who have taken to social media to complain that they can no longer afford the potentially lifesaving medicine.
“A trip to the ER is now cheaper. HOW CAN THIS BE??” one woman tweeted on Wednesday. Actress Mia Farrow weighed in: “Grandchild w severe allergies needs life saving #Epipen. Cost has soared. Luckily we can pay the $600. Impossible for many scared parents.”
The contrast between Bresch’s lavish lifestyle – her signature designer five-inch stilettos for example – and those of ordinary families struggling to afford the drugs her company sells is a theme that has come up again and again.
While many companies have curbed the use of company aircraft for personal business or required executives to provide reimbursement, Mylan has continued to allow Bresch to use one. The Pittsburgh Post-Gazette reported earlier this year that her corporate jet use hit $310,312, including both personal and business trips.
Another Mylan executive, Robert J. Coury, was called out by the Wall Street Journal in 2012 for having a side business that is a record label that promotes his son’s music career and for taking the jet frequently to cities that coincided with his son’s concerts.