Heavyweight investors sock big bucks into Valeant while others sell down

Bill Ackman

Valeant's ($VRX) former deal partner Bill Ackman is pretty rosy on his outlook for the company, as he's shown with a large share-grab and comparison to Warren Buffett's Berkshire Hathaway. But he's not the only one.

Other investors have made bets on the Canadian pharma, too, including John Paulson, who increased his stake by nearly 300% in the first quarter, The Wall Street Journal reports.

Echoing the sentiment over the quarter, Hound Partners increased its stake by 22% to 2.6 million shares; BlueMountain upped its holding by 356% to more than 920,000 shares; and Adage Capital Management listed a new position of 50,000 shares, Reuters notes.

Ackman's Pershing Square Capital Management took the cake, though, buying up 19.5 million shares in Q1. And while not all of Valeant's supporters may share Ackman's level of enthusiasm, many of them have liked what they've seen this year. The company's stock is up 56% since January, Reuters points out, and it's outperformed both the S&P 500 and the Pharmaceuticals subindex over the past 52 weeks.

As usual, acquisitions have helped power that climb for the Quebec-based deal machine. CEO J. Michael Pearson's company has already struck two accords, forking over close to $16 billion for GI specialist Salix Pharmaceuticals and nabbing cancer vaccine Provenge and other assets for $400 million from bankrupt biotech Dendreon. Those moves have helped put last year's failed, months-long pursuit of Allergan--on which Valeant and Ackman teamed up before losing out to Actavis ($ACT)--in the rearview mirror.

Some investors, though, have taken a different tack when it comes to Valeant--a company Ackman has acknowledged can be hard to value thanks to its deal volume. Viking Global Investors cut down its stake by more than half to 4 million shares at the end of last quarter, while Jana Partners pared its own holdings down 63% to 1.57 million shares. Iridian Asset Management, Brave Warrior and Lone Pine Capital also scaled back, Reuters reports.

Meanwhile, Ackman did the same with his share of Actavis, a position he built up in attempts to push it Valeant's way. At the quarter's close, Pershing Square owned about 1.35 million shares of Actavis, the WSJ says--way down from the 26.6-million-share-tally it once boasted.

- read the Reuters story
- and get more from the WSJ here and here

Special Report: The 25 most influential people in biopharma in 2015 - Bill Ackman - Pershing Square Capital Management