One of those likely departing is Mason Morfit, president at ValueAct Capital Management LLC, a person familiar with the matter told Bloomberg.
Advertisement
The names of the new directors could not be learned, but they draw heavily from traditional pharmaceutical companies, the newspaper said citing the people.
Pearson, whom Valeant plans to replace as soon as early May, will tell the Senate Special Committee on Aging that it was a mistake to pursue acquiring two drugs, Nitropress and Isuprel, with the intention of raising their prices previous year, according to written testimony shared with Morning Consult.
Outgoing Valeant Pharmaceuticals (VRX.TO) Chief Executive Michael Pearson plans to tell a U.S. Senate panel on Wednesday that he regrets his decision to acquire and jack up the price of two life-saving heart drugs, saying it was all a “mistake”.
The Quebec-based drug giant provided an advance copy of a statement Pearson is scheduled to deliver today before a U.S. Senate committee investigating drug price hikes.
The company was also questioned about the profits it made on many drugs after raising the prices, without a corresponding increase in research spending on research and development.
“In hindsight I regret pursuing transactions where the central premise was based on an increase in price”, Mr. Pearson, who is leaving the Canadian company soon, testified to the Senate Special Committee on Aging.
The blistering criticisms from Senate Republicans and Democrats came as Valeant’s outgoing CEO expressed regrets for the most egregious price increases and a billionaire hedge fund investor defended the company’s business model.
Lawmakers also said they couldn’t find any hospitals that were benefitting from Valeant’s discount program, and they chastised the company for jacking up the price of almost all of the drugs it acquired. “This is the business model. These patients don’t have alternatives”, said Senator Susan Collins.
Sitting beside Pearson at the hearing was Howard Schiller, who served as Valeant’s CFO from 2011 to 2015, then returned to the company as interim CEO for the first two months of 2016 while Pearson recovered from pneumonia. In other words, they claimed Valeant had no other way to make a profit.
Among other things, the company increased the price of Isuprel – a blood-pressure medication – by 720 percent and the price of Nitropress from $214 to $880.
“We can find nothing to explain these dramatic price increases beyond Valeant’s desire to take advantage of monopoly drugs”, said Collins.
Heyman testified Valeant denied her financial assistance when she sought help from the company because she was covered by Medicare.
Valeant has been under scrutiny amid controversies over soaring drug costs and its relationship with USA mail-order pharmacy Philidor, a connection it later severed.
Ranking Democrat Claire McCaskill, D-Missouri, said executives with ties to Wall Street have driven the adoption of Valeant’s price-hiking tactics, including former hedge fund manager Martin Shkreli who became the poster-child for the issue previous year. Cuprimine, a drug that treats Wilson’s disease, rose in price from $8.88 per capsule to $262 per capsule – an increase of 2,900%.
The company caught the attention of Congress past year after buying two life-saving heart drugs, Nitropress and Isuprel, and hiking their prices, tripling one and raising the other six-fold. Instead of letting it go, though, he’s doubled down on the company and joined the board himself last month. The company announced earlier this week that he will be replaced in early May by Joseph Papa, who recently stepped down as head of Irish drugmaker Perrigo.
Advertisement
The intense scrutiny of the Laval, Quebec-based company has triggered repeated sell-offs of Valeant shares, which have lost almost 90 percent of their value since peaking last August.
