Apotex And Bristol-Myers Squibb

Peter Dolan survived many crises in his 5-year tenure as CEO of drug giant Bristol-Myers Squibb, including a corporate accounting scandal, allegations of insider trading, Federal Bureau of Investigation (FBI) raids of his office, and a stock price that dropped 60 percent during his tenure. But in the end, what may have done Dolan in was his negotiation performance against the head of Apotex, a Canadian drug company founded by Dr. Barry Sherman.

At its peak, Plavix-a drug to prevent heart attacks-was Bristol-Myers’s best-selling drug and accounted for a staggering one-third of its profits. So when Apotex developed a generic Plavix knockoff, Dolan sought to negotiate an agreement that would pay Apotex in exchange for a delayed launch of Apotex’s generic competitor. Dolan sent one of his closest lieutenants, Andrew Bodnar, to negotiate with Sherman. Bodnar and Sherman developed a good rapport and at several points in their negotiations asked their attorneys to leave them alone. At one key point in the negotiations, Bodnar flew to Toronto alone, without Bristol-Myers’s attorneys, as a “gesture of goodwill. The thinking was that the negotiations would be more effective this way.”

As Dolan, Bodnar, and Bristol-Myers became increasingly concerned with reaching an agreement with Sherman and Apotex, they developed a blind spot. Privately, Sherman was betting that the Federal Trade Commission (FTC) wouldn’t approve the noncompete agreement the two parties were negotiating, and his goal in the negotiation was to extract an agreement from Bristol-Myers that would position Apotex favorably should the FTC reject the deal. Indeed, he nonchalantly inserted a clause in the deal that would require Bristol-Myers to pay Apotex $60 million if the FTC rejected the deal. “I thought the FTC would turn it down, but I didn’t let on that I did,” Sherman said. “They seemed blind to it.”

In the meantime, Apotex covertly began shipping its generic equivalent, and it quickly became the best-selling generic drug ever. Thus, Sherman also managed to launch the generic equivalent without Bristol-Myers even considering the possibility that he would do so while still engaged in negotiations.

“It looks like a much smaller generic private company completely outmaneuvered two of the giants of the pharmaceutical industry,” said Gbola Amusa, European pharmaceutical analyst for Sanford C. Bernstein & Company. “It’s not clear how or why that happened. The reaction from investors and analysts has ranged from shock to outright anger.” Within a few months, Dolan was out at Bristol-Myers (Carreyrou & Lublin, 2006; Saul, 2006).

Based on the above reading and the knowledge gained from your assigned readings, respond to the following questions:

What principles of distributive negotiation did Sherman use to gain his advantage?

Do you think Sherman behaved ethically? Why or why not?

What does this incident tell you about the role of deception in negotiation?

Assignment 1: Outline 

Before starting your outline, watch the “Creating a Speech Outline” video located here. An outline helps create an organized structure for what you plan to say. To review the assignment details, View Assignment 1. Complete these two steps to create and submit your outline: 1. Create an Outline in WordCreate an outline in Word. Click here to use an outline template or use your own.2. Submit in BlackboardAfter creating the outline, you must submit it in Blackboard. Click the Assignment 1: Outline link above to submit your outline as an attachment in .doc or .docx format

Assignment 1: Introductory Speech 

Attached Files:

• ???? View Assignment 1 (157.177 KB)

After you’ve created an outline and practiced your speech, it’s time  to record and upload your video. The speech is due this week.Instructions:Click the blue Assignment 1: Introductory Speech link above to  record and upload a video of yourself delivering your speech.  Instructions are available here.

Assignment 1: Self Review 

The  self review helps you step back and take a second look at your work,  with an eye on improvement and highlighting your achievements! Instructions: 1. Review the rubric for the introductory speech here. 2. Download the Self Review Questionnaire. Then check your Downloads folder to open and edit the file.3.  Watch the video of your speech. Complete the questionnaire based on how  well you met the criteria listed in the rubric, and remember to save  the file in your preferred location. 4. Click the blue Assignment 1: Self Review link above to attach and submit your Self Review file.