Valeant unloads Obagi in latest sell-off
- Valeant Pharmaceuticals has announced its latest asset sell-off as of Monday morning, another step in its efforts to streamline its business and reduce debt.
- The company has agreed to sell its Obagi Medical Products business for $190 million in cash to Haitong International Zhonghua Finance Acquisition Fund I, L.P.
- Obagi products are typically dispensed through plastic surgeons, dermatologists and medical spas, and include treatments for premature skin aging, skin damage, hyperpigmentation, acne and sun damage.
Valeant has been dismantling its business at a fraction of the pace that it built it. The specialty drugmaker was once touted for its dealmaking fervor – building its business through bolt-on acquisitions of late-stage products instead of developing drugs itself.
But hard times – including a scandal related to its mail-order pharmacy, prominent shareholders abandoning their investments, astronomical levels of debt and a falling stock price – hit the company, forcing it to reevaluate its business model.
Now Valeant has been moving in reverse, selling off the many assets acquired to build the business. Obagi is just the latest divestiture to be announced. The company has also announced the sell-off of iNova Pharmaceuticals for $930 million, its Dendreon assets for $820 million, and the CereVe, AcneFree and AMBI skincare brands for $1.3 billion.
Valeant announced the acquisition of Obagi in 2013, paying about $344 million for the dermatology company. The Obagi acquisition added to its already strong portfolio of specialty dermatology products.
The company made a promise last year to reduce debt by $5 billion within 18 months of August 2016. Most recently, Valeant said it has paid down $4.8 billion since the first quarter of 2016.
- Valeant Pharmaceuticals Statement
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