Los Angeles Times reported that Senate Aging Committee is to hold its third meeting on drug prices on Wednesday. Shares were up about 2.5% in after-hours trading.
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Mr. Pearson told the Senate Special Committee on Aging that increased drug prices have overshadowed the broader work of the company and “we therefore need to work to regain the confidence of Congress, the public, doctors and patients”. The drugmaker on Monday said Papa, a drug-industry veteran, would replace Michael Pearson as its CEO. The estimate is based on Valeant’s closing share price Wednesday. Nearly $100 billion has been erased from Valeant’s stock market worth.
Sen. Bernie Sanders, Vermont independent chasing front-runner Hillary Clinton in the Democratic presidential primaries, says Medicare should be required to negotiate with drug companies for better prices.
Outgoing Chief Executive Officer Michael Pearson could not recall.
After hearing of the difficulty in obtaining the 30% discount, Ackman said he would recommend extending the price reduction across the board.
The tough words from Senate Republicans and Democrats came as billionaire hedge fund manager William Ackman was set to defend the company’s business model, according to his prepared testimony. He vowed to urge Valeant’s board to reduce the prices of the four drugs targeted by the committee.
“I am committed to ensuring that this approach to drug pricing is never repeated at Valeant”, he said. Claire McCaskill (D-MO) said in Wednesday’s hearing, citing Maris’ statistics.
Last November, the committee determined that Valeant Pharmaceuticals acquired Nitropress, a drug used to treat cardiac arrest, raising its price from $215 per vial to $1,346 per vial – a 625% increase.
Other directors including Ronald Farmer and Chairman Robert Ingram are still deciding whether to resign, and the board has asked for their decision by Thursday. “That is absolutely not the case”.
“Perrigo has limited global business; Valeant has a lot”, says Maris.
At the same time, he plans to defend Valeant’s track record for research and development, saying the company is smart by acquiring and licensing drugs in a “later-stage” of development because it is more profitable and less risky.
Since August, Valeant has lost 85 percent of its value, Ackman said, a supposed reference to the Securities and Exchange Commission investigation of Valeant over alleged misstatements of financial results.
Valeant has alleged Schiller engaged in unspecified “improper conduct” that contributed to a $58 million mis-booking of revenue over which the company is planning to restate its past earnings. It also has said the “tone at the top” and pressure on executives to hit performance targets may have contributed to its problems.
Ackman, once one of Pearson’s biggest backers, withdrew his support after the company faced mounting troubles in recent months, with controversies over its business practices, accounting and drug pricing a year ago.
“In hindsight I regret pursuing transactions where a central premise was an increase in the prices” of the medicines, Pearson testified.
At the Senate hearing, lawmakers accused Valeant (NYSE: VRX) of gouging patients to reward Wall Street investors.
“This package is well above average”, said Mark Reilly, a managing director of Overture Group, a human-resources consultancy in Chicago, who has never advised Valeant. The hedge fund still remains one of the largest investors in the company with a 9% stake.
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-Joann S. Lublin contributed to this article.
