Valeant in spotlight again amid fresh reports of investigation
- Reports surfaced Monday afternoon that the trouble isn't over for Valeant Pharmaceuticals, as Bloomberg revealed federal prosecutors in Manhattan and the Federal Bureau of Investigation were looking into accounting practices of the company.
- The report, which cited sources close to the investigation, said the authorities were specifically looking at former CEO Mike Pearson and former CFO Howard Schiller in relation to their ties to the specialty pharmacy Philidor.
- "As Valeant previously stated in response to a prior, similar press report, the Company previously disclosed in October 2015 that the United States Attorney's Office for the Southern District of New York commenced an investigation involving Valeant. We have been fully cooperating with the authorities throughout the investigation, and we are in frequent contact and continue to cooperate with the U.S. Attorney's Office for the Southern District of New York," said the company in a statement.
With new reports stirring up old problems, Valeant's attempt to put its reputation issues in the past seems harder than ever.
The company has been making changes — including putting in Joe Papa at the helm and creating a chief quality officer position.
Yet investors and analysts have lost significant faith in the company and are unlikely to forget the company's deceptions and lack of transparency so easily.
Valeant was once a Wall Street darling due to its unique business model, which placed a lot of emphasis on acquiring late-stage and already-marketed assets to fill the pipeline, while neglecting in-house R&D.
Now that the business model has flopped, investors are looking for Valeant to increase its R&D effort and for that, it will have to acquire a pipeline. Keep an eye out November 8, when Valeant announces its most recent quarterly earnings, for news of expanding development operations.
- Bloomberg Valeant Ex-CEO, Ex-CFO Are a Focus of U.S. Criminal Probe
- Valeant Statement
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