Valeant CEO Pearson remains hospitalized for pneumonia

Valeant Pharmaceuticals International Inc. announced today that Chief Executive Officer J. Michael Pearson spent Christmas Day hospitalized for “severe” pneumonia.

Elaine Andrecovich, a public relations manager at Morristown Medical Center, where Pearson initially was admitted for treatment on Friday, confirmed that Pearson is not at the hospital but declined to provide more details. Laurie Little, a spokeswoman for Valeant, said Pearson is still in a hospital, but wouldn’t say where. She said that they are respecting Mike and his family’s privacy during this time and will keep us posted regarding the further details on his condition. He was also quoted as saying that Valeant will be providing more transparent information regarding the company’s business, including sales data for its 30 best-selling drugs.

Although Pearson enjoys the support of the board, some skeptics are wondering whether the time has arrived for a change in management considering the problems the company has been facing in recent times. Hedge funds crowded into Valeant and have been punished for it as the drugmaker’s stock plunged this year. “We wish him a speedy recovery and look forward to him returning to work when he is feeling better”, she said.

Pearson and Valeant have staunchly denied the claims.

Its critics say that Valeant has been using a mail-order pharmacy to artificially boost its sales.

Mr. Pearson focused on growth through acquisition of other smaller companies rather than research for new drugs which he shunned as risky. Valeant now has a $39 billion market cap. Last year, Valeant joined hands with Bill Ackman to buy Allergan, but the Botox maker fought the hostile bid and ended up getting acquired by Actavis PLC. In the past few months, the shares of the Canada-based Valeant fell as scrutiny of its business practices intensified. Valeant has said it plans to rebuild lost business in 2016 through a new distribution agreement with Walgreen’s pharmacies. The company’s price hikes are the subject of investigations by the U.S. Congress and federal prosecutors in NY and MA.