Ackman told the newspaper he pushed Valeant to hold a conference call to “come clean” and disclose the full extent of executives’ knowledge about Philidor, and that he was disappointed the company didn’t comply.
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Valeant’s stock continued its steep decline on Thursday, falling to a two-year low of $77 at points during the trading day.
Valeant, once a Wall Street darling, has seen its stock price fall by half over the last few months as politicians have attacked its low R&D spending business model and accused the company of price gouging.
The uncertainty about Mr. Pearson’s tenure was sparked by comments from one of Valeant’s largest shareholders, hedge- fund billionaire William Ackman, who had expressed doubts in a page-one article Thursday in The Wall Street Journal about whether the CEO had the skills needed to manage the political and public-relations challenges around the company, though he ultimately articulated support for Mr. Pearson last week. BMO Capital Markets lowered their price objective on shares of Valeant Pharmaceuticals Intl to $133.00 and set a “market perform” rating on the stock in a research note on Tuesday.
Valeant said it would cooperate with the investigations.
Even so, bond traders have not written off Valeant.
“If Mike hides in his bunker on this, he can’t be CEO”, Ackman told the company’s lead director, Robert Ingram of Hatteras Venture Partners, the Journal reported. Ackman’s incentives may be different than Valeant’s sometimes. “But let me be clear, we have not”. He said Pearson should stay at the helm of the drugmaker. The panel is led by Republican Susan Collins and Democrat Claire McCaskill, which is emblematic of the bipartisan fury over high drug prices. Democratic members of the House have urged their republican counterparts to call a vote to subpoena Valeant. Valeant, which is already the subject of a federal investigation in New York and Massachusetts, has said it will cooperate with the senators, according to Reuters.
Valeant “is right in the crosshairs, because it’s the poster boy for the drug-pricing issues”, he said. “The list price of any individual drug typically does not reflect the actual amount paid by a health care provider or insurance company, and Valeant devotes a significant portion of its revenue to patient assistance programs that are created to make important medicines more affordable to the patients who need them”. It also has been under scrutiny for its relationship with Philidor. Valeant said on Friday it was cutting ties with Philidor, effectively shutting down the pharmacy’s operations, as Valeant investigates whether Philidor engaged in any illegal activity. It plans to fill all prescriptions for the next week and “may continue to dispense certain prescriptions beyond that”.
In response, Philidor submitted claims to OptumRx for Valeant drugs using the identification numbers of at least four other affiliated pharmacies, these sources said.
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“We are reviewing and evaluating all similar captive pharmacy arrangements that we know of and will work to identify others”, Whitrap said.
