Valeant Pharmaceuticals International Plc, the drugmaker that became a poster child for high drug prices during the US election season, may change its name to help boost its reputation, board member and top investor William Ackman told CNBC on Wednesday.
A name change would be the latest effort by the company to break from its past, after hiring a new chief executive, overhauling the board and exploring billions of dollars in asset sales to pay down a $30 billion debt load. Valeant’s stock has declined more than 90 percent in the past year, erasing nearly $90 billion in market capitalization, over disclosures that it secretly worked with a specialty pharmacy to boost sales of its medicines. The company is the subject of multiple investigations by federal agencies and state prosecutors.
Watch what else is in the news
“Former Valeant (Chief Executive) Michael Pearson went crazy in my opinion,” Ackman said during his interview with CNBC.
A number of names are being considered, including taking on the well-known moniker of its largest business, eyecare specialist Bausch & Lomb, according to people familiar with the matter, who asked not to be named because they were not authorized to speak to the media. There has been no final decision to change its name at all, they added.
Previously named Biovail and based in the United States, the drugmaker acquired Canada’s Valeant in 2010 and chose that as its corporate identity. The acquisition, a so-called “tax inversion” because Valeant moved its headquarters to low-tax Canada, was a key step in its aggressive, debt-financed dealmaking spree under Pearson. The acquisitions helped reshape the specialty pharmaceutical industry and eventually left Valeant with around $30 billion in debt.
Some of the high points of Pearson’s buying binge include its $8.7 billion acquisition of Bausch & Lomb in 2013 and its $14.5 billion purchase of stomach-drug company Salix Pharmaceuticals in 2015. The deals made Valeant a darling of Wall Street, attracting such big name hedge funds as Ackman’s Pershing Square Capital Management and the Sequoia Fund and notching returns in excess of 1,000 percent during Pearson’s tenure.
In recent weeks, Valeant has been exploring a sale of its Salix business, according to media reports, that could fetch around $10 billion and would leave Bausch & Lomb as the largest single business in the company.