Valeant undertakes no obligation to update any of these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect actual outcomes, unless required by law.
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Correcting the misstatements will reduce 2014 GAAP EPS by ~$0.10 and increase 2015 GAAP EPS by ~$0.09. The last few months have been challenging on many levels. The CEO also stated although the company has a number of proven brands in the market and a great team to market them, but now the management needs to focus on rebuilding trust with the investors, while executing its business plans.
Last October, a short seller, Citron, issued a report raising questions regarding Valeant’s relationship with Philidor, a mail-order specialty pharmacy which distributed only Valeant’s drugs, specifically products from its dermatology portfolio. The review is being overseen by a special committee of Valeant board members and a former deputy U.S. Attorney General now working at the law firm Kirkland & Ellis LLP.
One-year share price: down 70%.
During the fourth quarter Valeant’s stock fell by 43% as the company failed to impress investors after being hit by a series of allegations in the third quarter.
Valeant’s strengths such as its robust revenue growth, good cash flow from operations and expanding profit margins are countered by weaknesses including a generally disappointing performance in the stock itself, unimpressive growth in net income and generally higher debt management risk. At that point, sales were recognized only when dispensed to patients. The drugmaker eventually revealed that it had paid $100 million for an option to buy Philidor for nothing at any time during the next 10 years, and consolidated Philidor’s financial results into its own.
Philidor said in November that it “has adhered not only to all applicable laws but to the highest standards of ethical business practice”.
The survey also found that just over half of investors expect Michael Pearson to return as chief executive after taking a leave of absence for medical reasons late a year ago.
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Shares of Valeant Pharmaceuticals Intl (NYSE:VRX) opened at 84.99 on Friday. No further sales-related adjustments will be necessary beyond this time frame. Valeant has not completed its review procedures with respect to 2015 financial information or adjustments to 2014 financial information, and the information herein may be subject to change based on such review, including the subsequent identification of other adjustments. That was reached last August. The firm presently has a $95.00 price objective on the specialty pharmaceutical company’s stock.
