Valeant’s outgoing boss tells Senate committee he “regrets” drug price rises
pharmafile | April 28, 2016 | News story | Manufacturing and Production, Medical Communications, Research and Development, Sales and Marketing | Senate, Valeant, admits, aggressive, committee, drug price, pearson, rises
Outgoing Valeant (NYSE: VRX) boss, Michael Pearson, expressed regret at the way his company conducted operations to a US Senate committee, saying that “I was too aggressive”.
Valeant’s infamous fall from grace has been very quick indeed, with the company’s stock plummeting over 80% in eight months. Price gouging allegations, withholding information from US inquiries and boardroom upheavels culminated in a miserable March for the company.
Before Joseph Papa takes the reins as Valeant CEO, Michael Pearson still had to appear before a US Senate committee to answer questions about the drug price rises that Valeant had engaged in.
Among the rises drawing the ire of the authorities, and the general public, was the 720% rise in the cost of asthma drug, Isuprel (isoproterenol), and the rare Wilson disease drug, Cuprimine (penicillamine), by approximately 5000%.
Pearson told the hearing: “In hindsight I regret pursuing transactions where a central premise was planned increase in the prices of the medicines… The company was too aggressive and I, as its leader, was too aggressive in pursuing price increases on certain drugs.”
When pushed on the lack of discounts provided by Valeant to hospitals, by the chairperson of the Senate panel, Senator Susan Collins, Pearson said: “I can assure you that many of the large hospital systems are getting discounts on the heart drugs.”
Also appearing before the committee was Valeant investor and board member, William Ackman, who declared that he would urge the company to abandon the price hike model. He said: “My recommendation is going to be to reduce the prices.”
Perhaps the most telling moment came when Senator Claire McCaskill asked the question of whether any of the Valeant representatives could recall one drug that they didn’t raise the price on.
Pearson admitted: “Not in the United States.”
The Wall Street Journal reports that the incoming CEO, Joseph Papa, will initiate a shakeup which will see five of its long-standing directors step down with new faces coming in. With the filing of its Form 10-K expected by close of play tomorrow, Valeant remain in the midst of a crisis where the outcome remains uncertain.
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