Valeant CEO Pearson to leave company
pharmafile | March 21, 2016 | News story | | Michael Pearson, Valeant
Valeant (NYSE:VRX) has announced that it has begun the search for a new CEO, confirming that Michael Pearson is to depart the company once a replacement is found.
Pearson has led the Canada-based company since 2008, and overseen monumental growth in Valeant’s value, based on a strategy of acquisition. This strategy’s success peaked in August 2015, when the company’s stock hit an all-time high of $263.81.
But controversy hit the company in the latter part of 2015, over both its drug pricing policy, and its business practices, with claims over its relationship to specialty pharmacy chains seeing share values plummet. As of March 21, shares are worth just $26.98 (at the time of writing).
Robert Ingram, chairman of the board, comments: “While the past few months have been difficult, Valeant has a collection of leading brands, valuable franchises and great people, and I am confident that the company will be able to rebuild its reputation and thrive under new leadership. We thank Mike for his dedicated service to Valeant and for agreeing to stay on until we conclude our search. As a colleague and a friend he will be missed, and we wish him the best for the future.”
Pearson says: “It’s been a privilege to lead Valeant for the past eight years,” said J. Michael Pearson, chief executive officer. “While I regret the controversies that have adversely impacted our business over the past several months, I know that Valeant is a strong and resilient company, and I am committed to doing everything I can to ensure a smooth transition to new leadership.”
Howard Schiller denies improper conduct
In addition, former chief financial officer, and Pearson’s stand-in as chief exec during his medical leave, Howard Schiller, has declined the board’s request for him to resign his position as a director. In the same statement revealing Pearson’s departure, Valeant admitted that Schiller had engaged in “improper conduct”, along with its former comptroller, by providing incorrect financial information to auditors.
Valeant said: “The tone at the top of the organisation and the performance-based environment at the company, where challenging targets were set and achieving those targets was a key performance expectation, may have been contributing factors resulting in the company’s improper revenue recognition.”
Schiller denied the accusation of improper conduct, saying in a statement: “At no time did I engage in any improper conduct that relates to any restatement of revenue the Company is considering. In addition, at no time did I ever provide any incorrect information to the Audit and Risk Committee or the Company’s outside auditors regarding this accounting issue.”
Joel Levy
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