The SEC needs to get cracking on this kind of stuf
Post# of 72440
Posted On: 10/26/2015 11:05:46 AM
The SEC needs to get cracking on this kind of stuff!
Valeant calls for SEC investigation into short-seller's actions
[Reuters]
October 26, 2015
By Caroline Humer and Euan Rocha
(Reuters) - Drugmaker Valeant Pharmaceuticals International Inc (VRX.TO) (VRX.N) said on Monday it has asked U.S. securities regulators to investigate a short-seller's "completely untrue" allegation that the company used its ties with a specialty pharmacy to inflate revenue, and said it would conduct a review of its pharmacy network.
Laval, Quebec-based Valeant fired back in a conference call with investors and analysts after the report by Citron Research, run by Andrew Left, hammered Valeant's stock last week by 35 percent.
"His motivation is the same as one who runs into a crowded theater and falsely yells fire. He wanted people to run," Valeant Chief Executive Mike Pearson said. "He intentionally designed the report to frighten our shareholders to drive down the price of our stock so he could make money for his short-selling."
Left disputed Pearson's comment in a statement.
"Yelling fire in a crowded theater is a lot different than walking into a theater, smelling smoke and yelling, 'Hey everyone, there could be a fire.'
"Now the information is out, people have had an opportunity to inspect the theater and they have chosen to leave ... maybe there is fire."
Valeant, whose U.S.-listed shares were down as much as 14 percent in premarket trading before paring losses to 10 percent, also said a board review had found that the company was in compliance with the law on revenue recognition from drugs sold through the specialty pharmacy, Pennsylvania-based Philidor Rx Services Llc.
It said it would set up an ad-hoc committee to look into allegations related to the company's association with Philidor.
Valeant's lead director Robert Ingram said the company's board has "complete and total faith" in Pearson.
Valeant's link to Philidor and its option to buy the company came under scrutiny after a New York Times report said that Valeant and other drugmakers were using specialty drug distributors to circumvent barriers to raising prices.
Valeant has said it properly accounts for sales through its pharmacy partners and only books revenue once one of its medicines reaches a patient.
Specialty pharmacies are designed to handle complex medications that have unique requirements for storage or administration. But Valeant has also used such pharmacies to sell more conventional medicines directly to patients, and work out reimbursement from insurers afterward.
That may allow them to get past limits on a drug's use imposed by insurers or a retail pharmacy. In Valeant's case, the company has been under scrutiny for its ties to Philidor, which has been accused by one of its affiliates of improper billing practices.
Pearson said Valeant will consider all options, including buying Philidor or severing ties with it, as well as using other specialty pharmacies.
The acquisitive company has been considering a sale or other options for its neurological business, but such a move is now on the back-burner, Pearson said.
(Reporting by Caroline Humer in New York, Euan Rocha in Toronto and Rod Nickel in Winnipeg, Manitoba; additional reporting by Michael Flaherty in New York; Editing by Nick Zieminski)
https://beta.finance.yahoo.com/news/valeant-c...06020.html
Valeant calls for SEC investigation into short-seller's actions
[Reuters]
October 26, 2015
By Caroline Humer and Euan Rocha
(Reuters) - Drugmaker Valeant Pharmaceuticals International Inc (VRX.TO) (VRX.N) said on Monday it has asked U.S. securities regulators to investigate a short-seller's "completely untrue" allegation that the company used its ties with a specialty pharmacy to inflate revenue, and said it would conduct a review of its pharmacy network.
Laval, Quebec-based Valeant fired back in a conference call with investors and analysts after the report by Citron Research, run by Andrew Left, hammered Valeant's stock last week by 35 percent.
"His motivation is the same as one who runs into a crowded theater and falsely yells fire. He wanted people to run," Valeant Chief Executive Mike Pearson said. "He intentionally designed the report to frighten our shareholders to drive down the price of our stock so he could make money for his short-selling."
Left disputed Pearson's comment in a statement.
"Yelling fire in a crowded theater is a lot different than walking into a theater, smelling smoke and yelling, 'Hey everyone, there could be a fire.'
"Now the information is out, people have had an opportunity to inspect the theater and they have chosen to leave ... maybe there is fire."
Valeant, whose U.S.-listed shares were down as much as 14 percent in premarket trading before paring losses to 10 percent, also said a board review had found that the company was in compliance with the law on revenue recognition from drugs sold through the specialty pharmacy, Pennsylvania-based Philidor Rx Services Llc.
It said it would set up an ad-hoc committee to look into allegations related to the company's association with Philidor.
Valeant's lead director Robert Ingram said the company's board has "complete and total faith" in Pearson.
Valeant's link to Philidor and its option to buy the company came under scrutiny after a New York Times report said that Valeant and other drugmakers were using specialty drug distributors to circumvent barriers to raising prices.
Valeant has said it properly accounts for sales through its pharmacy partners and only books revenue once one of its medicines reaches a patient.
Specialty pharmacies are designed to handle complex medications that have unique requirements for storage or administration. But Valeant has also used such pharmacies to sell more conventional medicines directly to patients, and work out reimbursement from insurers afterward.
That may allow them to get past limits on a drug's use imposed by insurers or a retail pharmacy. In Valeant's case, the company has been under scrutiny for its ties to Philidor, which has been accused by one of its affiliates of improper billing practices.
Pearson said Valeant will consider all options, including buying Philidor or severing ties with it, as well as using other specialty pharmacies.
The acquisitive company has been considering a sale or other options for its neurological business, but such a move is now on the back-burner, Pearson said.
(Reporting by Caroline Humer in New York, Euan Rocha in Toronto and Rod Nickel in Winnipeg, Manitoba; additional reporting by Michael Flaherty in New York; Editing by Nick Zieminski)
https://beta.finance.yahoo.com/news/valeant-c...06020.html
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