MONTREAL – Valeant Pharmaceuticals has assigned its lead director to head an internal review of allegations into the drug maker’s business relationship with Philidor – one of the main issues that cut billions of dollars off the company’s value last week.
Valeant (VRS) says it believes it has complied with the law but a committee of non-management directors will review allegations surrounding Philidor, a specialty pharmaceutical company.
The company is trying to extinguish concerns ignited by Citron Research, which compared Valeant with the collapsed energy giant Enron.
It has also called Citron’s allegations “erroneous” and an attempt to manipulate the market to drive down Valeant’s stock price – which fell 32 per cent last week to $152.69 on Friday, lowering the company’s market value to about $52 billion.
The committee looking into the allegation will be headed by Robert Ingram, who has been on Valean’’s board for five years. Ingram is also a partner of Hatteras Venture Partners, which specializes on pharmaceuticals and medical devices.
Valeant chairman and chief executive Michael Pearson repeated that Valeant has complied with the law but welcomed the board’s review and said it would free management to run the business.
“We operate our business based on the highest standard of ethics, and we are committed to transparency,” Pearson said in a statement ahead of Monday’s conference call with analysts – the second in less than a week.
In the company’s statement, Ingram said the board “has complete confidence in Mike Pearson’s performance as CEO and has fully supported the company’s specialty pharmacy strategy.”