Embattled Valeant doesn't 'need to sell anything,' new CEO says

Joseph Papa

Embattled drugmaker Valeant has been weighing selling off some non-core assets to pay down its mountain of debt. But let its new CEO be clear: It doesn’t have to.

“I don’t need to sell anything,” chief exec Joseph Papa said Monday at the UBS Global Healthcare Conference, as quoted by Business Insider.

Of course, that doesn’t mean the company won’t do it. First, though, “there will be some places where we’ll have to make some decisions on what’s core,” he said. Right now, that list includes its dermatology business, its Bausch & Lomb eyecare unit, and its GI portfolio, The Globe and Mail notes. But even those puzzle pieces have found their way into divestment chatter, with Bloomberg recently reporting that skincare division Obagi Medical Products could be sold and new board member Bill Ackman suggesting earlier this year that B&L could be spun off.

In the meantime, Valeant will be working to increase the discounts it promised before Congress to jacked-up heart meds Nitropress and Isuprel--and expanding the price pare-down to meds Cuprimine and Syprine. Lately, hospitals have be grumbling that they haven’t yet received their price breaks, which prompted the Canadian drugmaker to recently set up an internal drug-pricing committee

“I have a couple more of those products that I still need to work on, and I told Congress I would work on those,” Papa said, as quoted by The Globe.

It’ll also be doing its best to live up to the revised earnings guidance it put forth in March amid news that several key products were underperforming. And while Papa wouldn’t promise Monday to exceed the new forecasts, he did tell listeners that his guidance philosophy is to “under-promise and over-deliver,” according to The Wall Street Journal.

But colleagues and shareholders at his former company, Perrigo, may disagree. The Dublin pharma revised its own guidance downward as soon as it announced Papa’s departure, with new head honcho John Hendrickson griping that Perrigo’s “recent track record of performance against our own expectations is unacceptable.” Instead, he intends for “the expectations we lay out to be realistic, numbers we feel we can deliver,” he said on a conference call.

- see the Business Insider story
- get more from The Wall Street Journal (sub. req.)

Special Report: The most influential people in biopharma today - 2016 - J. Michael Pearson - Valeant

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