CHRONOLOGY

First, let's sum up what happened (Excerpted and modified, NYT, 5/18/06, "From Asia to America, how Bausch's crisis grew"):

-- The first report to strongly associate the problem with Bausch's product MoistureLoc, came from Singapore on February 17, 2006, after the Singapore National Eye Center noticed a cluster of seven cases. Officials viewed records back to the preceding May and found that the Bausch product had been involved in 18 of 19 cases that were linked to lens use. The cause was fusarium fungi. (Fusarium is common in drains, sinks and many types of plants, especially in tropical climates. Based on Centers for Disease Control estimates, there may be 750 to 1,875 eye infections involving the fungus each year in the United States. Most probably occur when people scratch an eye in a garden or wooded area.) Bausch quickly agreed to stop selling its soft-lens cleaners in both Hong Kong and Singapore.

-- Bausch then began a thorough investigation of its production and distribution systems in an effort to find the missing links between its products and the infections. That investigation began at the Greenville plant on February 17, the day Singapore reported its MoistureLoc data. One by one, the simple possibilities were ruled out as likely explanations, including direct contamination in the factory or sabotage in the distribution system.

-- Then it took a turn for the worse. Early in March, Bausch & Lomb was contacted Dr. David S. Chu, a specialist in cornea diseases in New Jersey, alerted the company that three of his recent patients had been afflicted with a microbe that caused a potentially blinding eye infection. All three, Dr. Chu said, had used Bausch & Lomb's ReNu brand lens cleaners. Bausch quickly confirmed that Dr. Chu's patients had been infected by Fusarium fungi. Starting with Dr. Chu's call, data about the fungal cases in the U.S. and abroad quickly piled up.

-- On around March 22, the F.D.A. began intensive investigation of its factory in Greenville, S.C., the major source of ReNu products for the United States and Asia.

-- On March 31, Bausch issued its first news release in the United States calling attention to the Fusarium outbreak. The company said it did not believe that the infections were related to any particular lens-care product.

-- As April progressed, Centers for Disease Control began issuing updates on the outbreak that consistently showed MoistureLoc to be the riskiest lens cleaner by a wide margin. When the Centers for Disease Control released its first data on the United States outbreak on April 10, the results showed that 26 of 28 confirmed cases of Fusarium infections in soft-lens users involved ReNu products, mostly MoistureLoc.

-- Bausch stressed at the time that the health authorities had not concluded the figures were abnormal, but said it was halting shipments of MoistureLoc in the United States as a precaution. The move, which stopped short of a recall, reflected Bausch's lingering hopes that more data would clear the cloud over MoistureLoc. The F.D.A. called it "appropriate." But the halt in shipping left retailers with potential liability for continued sales, and many merchants quickly took MoistureLoc, as well as other ReNu products, off their shelves. Three days later Bausch announced a full recall in the U.S.

-- By the beginning of May, Bausch was confident that the fungi were not being shipped in the product. Genetic analysis of fungi recovered from patients' eyes and their contact lens gear showed that the microbes belonged to several Fusarium strains, which made it unlikely that they came from one factory. Moreover, Bausch found in close to 1,000 tests that samples of MoistureLoc produced at the same time as bottles used by infection patients consistently killed Fusarium. Such signs pointed toward Fusarium's being picked up where users lived, with consumers' lens-care habits playing at least some role in the infections. In a theory fleshed out through lab tests early this month, Bausch concluded that when the product is improperly used the ingredients in MoistureLoc sometimes combine to form a thin film that shields Fusarium from MoistureLoc's fungus-killing ingredient. An F.D.A. official, Dr. Daniel Schultz, director of its Center for Devices and Radiological Health, endorsed that theory about MoistureLoc, along with the company's contention that the evidence to date did not point to safety issues with MultiPlus or other ReNu products.

-- As of Friday May 12, the federal Centers for Disease Control and Prevention said it had confirmed 122 cases of the fungal infection, 15 possible ones and 60 still under investigation in 33 states and territories. While a few involve lens cleaners made by other companies, Bausch customers make up the vast majority of those affected.

-- On Monday, May 15, Bausch issues a global withdrawal of the product.

BRIEF ANALYSIS FROM A PR PERSPECTIVE

Well, before I give a list of the "to-dos" from a strategic perspective, let's sum up the results:

Have you seen the current Bausch & Lomb commercial featuring Zarella?! It's fantastic. Talk about turning lemons into lemonade. Variously, Zarella and his communications team were able to: defuse the general public's fears; increase general awareness; dramatically increase trust; and absolutely increase the perception of responsibility and professionalism from the top.

What did they do strategically? They:

-- Began immediately a thorough investigation to isolate the problem;
-- Fully cooperated with the F.D.A. (The F.D.A.'s Dr. Daniel Schultz, director of its Center for Devices and Radiological Health, ultimately praised the company for working with regulators to find the underlying cause of the problem in a "timely and effective way.") Here Bausch neutralized any polar aspect and relied on a credible 3rd party to help dismiss the question of culpability;
-- Cleaned the sales channel and prepared for a recall;
-- Issued a heart-felt apologize from the top;
-- Underscored that their motive equaled/equals the key message. "Number One priority is the safety of our customers." (See Zarella's message May 15.)
-- Launched an outreach information campaign to reeducate where necessary any lingering misperceptions (the Wear&Care program);
-- Lastly, they laid claim to expectations and aligned them with company tradition. "For more than 150 years, people have trusted the health of their eyes to Bausch & Lomb."

Certainly, there can be endless Monday morning quarterbacking here. Those in the "know" will point to two specific questions: Did they move fast enough? Are they out of the woods? The short answer is "no" and "probably not." The company itself already regrets their speed, or rather lack thereof. Angela J. Panzarella, vice president for global vision care, said speaking of the recall, "I wish we had made the decision the first day not to sell or use it."

As to the future of the company, the jury is still out among eye specialists, financial analysts and plaintiffs' lawyers.

Again from NYT, 5/18/06, "Given that Bausch is planning to ramp up production of ReNu MultiPlus, which itself has been linked to at least 20 percent of the Fusarium cases reported to the C.D.C., 'the company could face a drain on cash if it ends up having to remove MultiPlus from the market,' said David Maris of Banc of America Securities. 'That doesn't leave a lot of wiggle room for legal liability,' Maris said. More than a dozen lawsuits have already been filed, and such suits could wind up costing the company $1 billion, Maris predicted. Paul J. Pennock, the partner in charge of pharmaceutical and medical-device litigation at Weitz & Luxenberg, a plaintiffs' law firm in New York, predicted that there could end up being 1,500 cases."

That's too bad. I wish Zarella all the best. Unfortunately, in a wind shear, even the best pilot is going down. That's too bad. He certainly seems like a nice guy. I hope it all works out for him.