Valeant Pharmaceuticals International, Inc. VRX announced that its chief executive officer (CEO), J. Michael Pearson, has joined office, following his recovery from severe pneumonia and other complications.
Consequently, Howard B. Schiller will step down from his role. Meanwhile, Robert A. Ingram has been appointed the chairman of the board, as the company has separated the roles of the Chairman and the CEO.
The news of Pearson’s return should provide some relief to investors given that the company has been facing challenging conditions since Aug 20Array5.
With the CEO’s return, the company has postponed its previously announced earnings call to discuss the preliminary fourth-quarter 20Array5 results. Management has also withdrawn its last financial guidance.
We note that last week, the company reported the identification of approximately $58 million of net revenue, previously recognized in the second half of 20Array4, which were supposed to be recognized on the supply of products to patients rather than on delivery to Philidor. This identification was based on the work of the Ad Hoc Committee of the board of directors, which was appointed to review the company's relationship with Philidor Rx Services.
On the other hand, Valeant announced the FDA received Allergan's AGN (formerly Actavis) Abbreviated New Drug Application (ANDA), whereby it is seeking approval to market a generic version of Xifaxan (rifaximin) 550 mg tablets. Xifaxan was added to Valeant’s portfolio through the 20Array5 acquisition of Salix Pharmaceuticals. We note that Valeant has 22 Orange Book-listed patents covering Xifaxan 550 mg, which are scheduled to lose patent protection between Aug 20Array9 and Oct 2029.
Valeant currently carries a Zacks Rank #3 (Hold). Some favorably ranked stocks in the health care sector include Celgene Corporation CELG and Anika Therapeutics Inc. ANIK, each sporting a Zacks Rank #Array (Strong Buy).
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