For anyone in the biopharma sector, the February 4 drug pricing hearing held by the House Oversight Subcommittee felt like watching a car crash. Unfortunately, the behavior of the star witnesses suggests there may be more wreckage to come.

The most agonizing portion of the hearing was the non-testimony of former Turing Pharmaceuticals AG CEO Martin Shkreli, who seems bent on living up to the description of several members of the committee that he is “the poster child for greed in the pharmaceutical industry.” His uncomfortable smile made the always ugly ritual of pleading the Fifth truly difficult to watch. To make matters worse, after he was excused from the hearing, he opted to tweet his perspective that the committee is comprised of “imbeciles” – while the four-hour hearing was still going on. Also see "At Drug Pricing Hearing, Innovator Companies Mainly Escape Congressional Wrath" - Pink Sheet, 5 February, 2016.

That behavior does not seem likely to encourage Congress to move on to other topics.

The other company in the hot seat, Valeant Pharmaceuticals International Inc., took a very different tack, but may have found a way to match Shrkeli in tone-deafness.

Interim CEO Howard Schiller essentially spent four hours apologizing for past practices, and promising never to misbehave again. The tone wasn’t always right – Schiller has a habit of referring to specific drugs as “assets” which only seems to reinforce the perception that Valeant is far too focused on maximizing shareholder value rather than on developing and delivering high quality medicines. But if only by contrast with Shkreli, Schiller seemed to be doing what he said he hoped to do during Valeant’s year-end earnings call: “survive” the inquiry, and hope to come out the other side once the debate over drug pricing dies down.

Which makes what Valeant did next inexplicable: the company sponsored two different direct-to-consumer ads during the Super Bowl.

Valeant acknowledges that it has underinvested in government relations and PR, but surely someone in the company is aware that—fairly or not—DTC advertising is still a sore point for the industry’s critics?

Schiller faced uncomfortable questioning about his salary (which he said amounted to $27 million), premised on the idea that Valeant’s price increases were directly lining his pockets. Given that the Super Bowl is now defined as much by how expensive the ads are as by how exciting the game is, who thought this was a good time for Valeant to try to match Doritos in spending on the big game?

It doesn’t help that the ads are the type that industry critics love to cite. One was for the toenail fungus therapy Jublia, and will be held up as evidence that innovator drugs are frivolous. The second is for the irritable bowel therapy Xifaxan, and featured an animated colon and repeated mentions of diarrhea.

That ad was certainly memorable, and getting attention is the point of advertising. But Valeant shouldn’t be looking for more attention right now – at least, not by so prominently investing in advertisements.

For a company that says it just wants to “survive” this period of scrutiny, it is astonishing that Valeant may have found a way to one-up Shkreli in how to stick a thumb in the eye of its critics.

The Super Bowl of Mismanaging Congressional Investigations: Shkreli Vs. Valeant

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