Valeant selects trio to fill in for ailing CEO, shares dive
By Ransdell Pierson
NEW YORK (Reuters) - Valeant Pharmaceuticals International Inc (VRX.TO: Quote)(VRX.N: Quote) on Monday said a group of company executives will immediately take over for its chief executive officer until he returns from medical leave, news that sent its shares tumbling 10 percent.
The Canadian company said CEO Michael Pearson, 56, was being treated for severe pneumonia.
The decision to put leadership in the hands of three executives was unusual, experts said, and suggested a lack of confidence in any one company executive to temporarily fill Pearson's shoes.
Valeant and Pearson have come under pressure for steep price increases on some drugs and for close ties to a specialty pharmacy that used aggressive methods to overcome insurer barriers to reimbursing its medicines.
Pearson was hospitalized with the lung condition on Friday. A company spokeswoman declined on Monday to say whether he had experienced any complications or when he might return, adding it was honoring a family request for privacy.
"It is an inopportune time for their leader to take sick leave after the company has faced credibility issues in recent months," said Morningstar analyst Damien Conover. "If the company was on solid footing, it wouldn't be as much of an issue."
Valeant said its board has created an "office of the Chief Executive Officer," which will include General Counsel Robert Chai-Onn, Group Chairman Ari Kellen, and Chief Financial Officer Robert Rosiello.
The board also created a committee to oversee and support the office of the CEO, including lead independent director Robert Ingram, president of ValueAct Capital Mason Morfit, and former Valeant CFO Howard Schiller. Continued...