As the CEO of Pfizer, the world’s largest drug maker, Ian Read followed a years-long pricing strategy that reaped billions for his company. It was like clockwork: jack up prices every six months. The moves did not go entirely unnoticed, but Pfizer generally escaped much flak because other pharma companies did the same thing.
But Read’s pricing game plan didn’t seem so shrewd when President Trump entered the picture last week. Days earlier, Pfizer was virtually alone in raising prices for dozens of drugs — many by more than 9 percent — and it prompted a raging tweet from Trump. In a brief phone call with the president that Read sought on Tuesday night to defuse the uproar, the CEO backed down and deferred the hikes.
Suddenly, Read found himself tangling with the president, and — more critical to his company — scrambling to avoid becoming the poster child for price gouging.
Truly good corporate governance includes practices that align the interests of the chief executive not with shareholders but with employees, customers, and society as a whole. The “shareholder value above all” mantra is responsible for much of the pathology of business today. Just saying.