2008: Year of the Rat? Year of the Recall is More Like It
Following a disastrous 2007, in which dozens of Chinese products ranging from pet food to toothpaste and from toys to tires were recalled in waves by U.S. manufacturers, this year is playing out to be even worse for the Beijing government and its global business partners.
In the midst of its publicity woes involving Tibet and the Olympic Games, China is facing severe criticism for contamination of the active ingredient in the blood thinner Heparin, which has now been linked to more than 80 deaths worldwide.
Unlike the 2007 incidents, however, the Heparin case portends a new wrinkle in the world of product recalls. That’s because in 2006, China displaced the U.S. as the largest source of EU imports, totaling $191.8 billion euros in that year alone – a fact that makes a European “year of the recall” likely to follow the “summer of the recall” the continent experienced just months ago. (more)
The recent French, Italian, Dutch and Swedish recalls of Heparin only serve to further this hypothesis. As such, European companies need to ready their recall communications plans now, before they are needed – given the increased scrutiny that European product safety will garner as a result of highly-publicized American recalls, as well as the tougher regulatory environment in which European companies must operate.
In 2008, European companies would be wise to examine their American counterparts’ approach to restoring a sense of normalcy to the marketplace in the wake of China-related recalls. Are they ready to battle the plaintiffs bar in cyberspace? Are they prepared to issue messages that convey empathy and responsibility, but not culpability? Are they cultivating relationships with third party advocates that can lend credibility to their cause?
The Heparin recall may well be a warning sign of things to come. Smart European companies will take heed and prepare themselves for the impending storm.
May 1st, 2008 at 2:05 am
Year of the Rat? Perhaps.
As America begins to sort through the finger pointing and blame, it seems that we may be wise to look to European standards instead. David Nelson, a Congressional investigator, recently told the House panel that had the F.D.A. inspected the Chinese plant a disaster of this magnitude could have diverted. Perhaps we should demand tighter regulations on the nation’s drugs, medical devices, and food.
The New York Times recently added that the F.D.A. officials have admitted they mistakenly failed to conduct an inspection of the Changzhou SPL plant, but said that an inspection would not have been able to uncover the contamination, the Times goes on to add that the agency finally conducted an inspection of the facility in February and found so many problems that the F.D.A. blocked the plant from exporting to the United States.
Errors such as these show a degree of laxation that has proven to be mutually devastating for both the people of this country and the F.D.A. With the advent of social media and blogs, every individual has the potential to become the “David” to “Corporation Goliaths.” To effectively address the issue of competency in the minds of their consumers companies may have to put the pressure on regulatory policy in Washington, something we are not likely to see anytime soon.