Valeant CEO Pearson to Return From Medical Leave, Drugmaker Says

The company will be rescheduling its call to discuss preliminary fourth quarter 2015 results, deliver a business review, and provide updated guidance for 2016.

Robert Ingram has been named Chairman of the Board, since Valeant has now separated the roles of Chairman and CEO. Yet Valeant had paid $100 million for the right to acquire it, and members of Valeant management were deeply involved in establishing the Pennsylvania pharmacy.

The news of his return is “encouraging because Pearson is a visionary who created significant value for shareholders over several years”, Morgan Stanley analyst David Risinger, who rates the shares neutral, wrote in a note to investors.

“My immediate priority will be to build stronger relationships with important constituents, such as managed care and other channel partners, regulators and government representatives, while improving Valeant’s reporting procedures, internal controls and transparency”, Pearson said in the statement.

Questions have been raised about Valeant’s relationship with Philidor, which distributed some of the company’s specialty drugs until their relationship was ended abruptly in October.

Interim chief executive Howard Schiller, a board member and the company’s former chief financial officer, will step down but remain on the board.

Valeant cut ties with Philidor last fall amid allegations that Philidor created a network of “phantom pharmacies” to steer pharmacy benefit managers toward Valeant’s more-expensive drugs instead of cheaper alternatives. Simplex Trading now owns 3,412 shares of the specialty pharmaceutical company’s stock worth $1,850,000 after buying an additional 2,417 shares during the period.

“I realize that recent events are disappointing to everyone and it is my responsibility to set the appropriate tone for the organization”, Pearson said. The drug-maker stated that the preliminary annual results for last year and guidance for this year will be announced “in near term”. TD Securities lowered shares of Valeant Pharmaceuticals Intl from a “buy” rating to a “hold” rating in a research report on Monday.

Financial bloggers on sites such as SeekingAlpha, wsobserver.com and others, seem to have a Positive view on VRX. Simplex Trading increased its position in shares of Valeant Pharmaceuticals Intl by 242.9% in the fourth quarter.

Investors have been divided on Pearson’s return, and shares fell last week, reflecting concern about the company’s future.

On December 15th, the drugmaker announced an agreement to sell skin and eye medications through Walgreens Boots Alliance at a lower price. Also, while he was on the medical leave, the company had conceded that he had miscommunicated the company’s growth strategy.

In light of these developments, Mr. Pearson might not look good enough to regain the company’s leadership. Deltec Asset Management LLC bought a new position in shares of Valeant Pharmaceuticals Intl during the fourth quarter worth $610,000.