Valeant CEO Paints Picture Of Rosy Future Amid Rumblings Following Disappointing Q2
Joseph C. Papa tried to reassure investors with promises of reorganization and a new strategy, but backing them up will be a tall order for the new CEO.
The Associated Press:
Valeant's Rosy Forecast And Promised Changes, Fire Up Shares
Drugmaker Valeant Pharmaceuticals, a fast-growing Wall Street darling until its price-hiking business strategy made it a symbol of pharmaceutical company greed, said it's undergoing a restructuring as its new CEO attempts to return the debt-laden company to growth and respectability — without big price increases. "We have begun the process to stabilize, turn around and transform Valeant" into a new company over the next several years, Joseph C. Papa, who became chief executive three months ago, said during a conference call to discuss a money-losing second-quarter with results far below Wall Street expectations. (8/9)
The Wall Street Journal:
Valeant Posts A Loss, Says It Will Retool
Just a year after its stock rocketed to an all-time high, Valeant Pharmaceuticals International Inc. looks like an entirely different company. About $80 billion of the Canadian drugmaker’s market value has been erased, as has its business model of acquiring drugs and raising their prices. Its former chief executive, Michael Pearson, has departed in favor of Joseph Papa. And on Tuesday as it posted another quarterly loss, the company took steps to transform itself further, saying it would reorganize and sell some noncore assets to reduce its debt load as it works to retrench itself as a conventional pharmaceutical firm. (Steele, 8/9)
The Wall Street Journal:
Some Hope, But No Cure For Valeant
Valeant Pharmaceuticals International managed to please its shareholders Tuesday morning. But the company hasn’t put its tumultuous past entirely to rest. Valeant reported second-quarter sales of $2.4 billion and adjusted earnings of $1.40 a share. Both fell short of analyst expectations for the third consecutive quarter. Still, the stock rallied sharply after Valeant reaffirmed its full-year guidance for sales and adjusted profitability metrics and announced a new sale of one of its drugs to raise cash. (Grant, 8/9)
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