Ex-darling Valeant Pharmaceuticals is hoping to put its annus horribilis in the rear-view mirror when its reports its second-quarter results Tuesday.
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On Monday, Shares of Valeant Pharmaceuticals Intl Inc (NYSE:VRX) gained 2.23% to $22.45.
“We greatly appreciate the contributions that Valeant is making to Wilson disease patients”, said Mary L. Graper, president of the Wilson Disease Association.
Valeant also maintained its 2016 full-year earnings outlook of $6.60 to $7 per share in adjusted, non-GAAP earnings and revenue of $9.9 billion to $10.1 billion. Valeant has faced fierce criticism for its drug pricing after The Wall Street Journal reported in April of a year ago that the company had raised the prices of Isuprel and Nitropress, two cardiac-care drugs, by 525% and 212%, respectively, after acquiring the rights to the medicines. Like Estimize, Wall Street has overestimated the top line in the past few quarters, but so far the analysts expect almost 16 percent revenue growth for the full year.
It has been just over a full year since Valeant shares hit an all-time closing high.
The switch comes amid a period of regulatory scrutiny, with the US Securities and Exchange Commission probing accounting irregularities and federal prosecutors investigating its relationship with US mail-order pharmacy Philidor over alleged improper booking of revenue.
On a positive note, Valeant’s cash flow from operations improved. It was up nine per cent to $448 million. On Tuesday, Mr. Papa said they improved profitability in early August. Pearson, who said buying drugs and then jacking up prices was a mistake, received a $9 million severance package upon leaving the company and still owns at least a million shares of Valeant stock, as he’s required to for a minimum of two years.
Mylan CEO Heather Bresch continued, “The addition of Meda builds on everything we have put in place around the world, creating even greater scale, breadth and diversity across products, geographies and sales channels”. That’s a 9% increase from the same quarter previous year. The company, which has been selling non-core assets, said it had stripped the North American rights to the inherited angioedema drug, Ruconest, to Netherlands-based Pharming Group NV in an arrangement worth up to $165 million. It’s possible that Valeant could detail more debt reduction plans related to the “new strategic direction” in its earnings conference call.
Valeant’s second-quarter results underscore a key point for investors: The long term is more important than the short term. Valeant subsequently cut ties with the company. “0” brokerage firms have issued “Sell” rating for the company and “Strong Sell” rating was issued by “3” brokerage firms. And we think its stock price has almost unlimited room to run for early in-the-know investors!
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Keith Speights has no position in any stocks mentioned. Valeant Pharmaceuticals Intl Inc makes up approx 0.80% of Seven Bridges Advisors’s portfolio. The Motley Fool has a disclosure policy.
