It is hardly surprising the BioIndustry Association’s code of best
practice, published for consultation last week, has been welcomed by PR
professionals both in agencies and in-house.
Many argue they already adhere to the guidelines as part of their
working life - getting press releases signed off by senior personnel is
already common practice.
But any help in reviving the sector’s image and thus its fortunes must
be gratefully received given current perceptions of the industry as
having more cowboys than a spaghetti western.
At its height three years ago, the biotech sector - consisting of
companies whose products, such as medicines, are made by manipulating
genes - was worth between pounds 5 billion and pounds 6 billion. It is
now worth less than half that amount, according to industry
Share prices have collapsed. Flotations, which used to happen at the
rate of one a month, have all but dried up; and several firms that made
their market debuts in recent years are trading at about 25 per cent of
their flotation price.
Scandals, such as the one surrounding British Biotech last year, sent
share prices tumbling and investor confidence went with them. British
Biotech has just been publicly censured by the Stock Exchange for ’a
most serious’ case of misleading investors. Short of delisting the
shares, it was the strongest action the Exchange could take.
Many in the field believe the BIA guidelines are a pre-emptive
self-regulatory strike designed to head off the threat of legislation,
made more urgent by the public dressing down of the company that used to
be the jewel of the sector.
But Ludgate deputy chairman David Simpson, who heads the agency’s
British Biotech account, dismisses the idea that the BIA’s hand was
forced. ’The BIA had been working on a code of best practice well before
(the events of last year),’ he says.
The biotech sector is incredibly volatile because investors are almost
entirely dependent on announcements about the progress of new products
as few companies have any products in the market by which success can be
The vast majority of biotech firms are involved in lengthy research and
development programmes, followed by equally lengthy clinical trials.
Companies are under great pressure to manage the flow of news to
analysts and investors. ’If you haven’t made any announcements in six
months, analysts start to wonder if there is something wrong,’ says Sue
Charles, chief executive of HCC De Facto, the biotech PR specialist
which handled the announcement of Dolly the cloned sheep.
Journalists covering the sector tend to take a less charitable view.
’Biotech companies put their PR agencies under pressure to produce
column inches and to make their share price rise, which is why my fax
machine is forever spitting out press releases that are rehashed
versions of releases from four weeks ago that weren’t that interesting
then,’ says one.
Charles and several of her peers stress that they cannot control
entirely how their announcements are used by the press. ’A story saying
that a drug is one step further along a ten-year process and may prove
helpful to cancer in eight years’ time is not going to sell newspapers.
’Cure for cancer found’ is,’ she observes.
Vanguard Medica head of corporate communications Anne Gilding recalls an
incident concerning a psoriasis drug that panned out as Charles
’We were at the very early stage of development. To give the story a bit
of a human interest element, I wrote in the third paragraph that the
drug contained a synthesised extract from marigold leaves. The papers
jumped on it and there were stories about a natural cure for psoriasis
being found, which, of course, it wasn’t,’ she says.
’We had a massive response from sufferers, some asking to be included in
the clinical trials because they were at the end of their tether. It is
far worse for people working on breast cancer or Aids drugs. The whole
thing was completely blown out of proportion.’
Although there is widespread interest in genetic technology, it is a
difficult subject to bring to life. The rare stories which attract the
eye, like the cloning of Dolly the sheep, are seized, and embellished
on, by a hungry media. The PR challenge is to resist capturing headlines
at the expense of a distorted story.
And while accuracy of information is obviously vital, so, as the code
highlights, is balance. ’It is quite possible to write something
accurate without it being completely balanced,’ says Gilding. ’We must
take into account the effect an announcement will have - it is not just
the letter of the code that must be obeyed, but also the spirit and
The penalties for breaking the code will be public censure by the BIA,
and possible expulsion from its ranks.
Censure from a trade body can be a powerful weapon. Confidence in a
censured firm evaporates, shares go into free fall, it is difficult to
orchestrate clinical trials, which depend on co-operation between firms,
and attracting quality recruits is a problem, says Ludgate’s
British Biotech survived the displeasure of the Stock Exchange. The
BIA’s code should prevent its peers from facing a worse fate.
The BioIndustry Association draft guidelines state that companies must:
- ensure information is accurate and balanced
- only put out information investors actually need
- ensure all releases are signed off by senior personnel
- give definitions of terms and phrases and use them consistently over
- ensure no price-sensitive information is published before being
announced to the Stock Exchange