Valeant CEO cuts outlook for 'distracted' company, shares plunge
By Amrutha Penumudi and Rod Nickel
Reuters) - Valeant Pharmaceuticals International Inc (VRX.TO: Quote) slashed its 2016 forecasts on Tuesday, as its new chief executive said he would focus on rebuilding the reputation of a "distracted organization" with a debt-loaded balance sheet.
The maker of toenail fungus cream Jublia and anti-depressant drug Wellbutrin, which has faced intense scrutiny for business and accounting practices, missed first-quarter profit estimates on weakness in its dermatology business.
The Laval, Quebec-based drugmaker expects full-year adjusted earnings of $6.60-$7.00 per share, compared with its previous forecast of $8.50-$9.50, and revenue of $9.9 billion-$10.1 billion, down from $11.0 billion-$11.2 billion.
The Canadian drugmaker's U.S.-listed shares (VRX.N: Quote) slumped to close down 14.6 percent to $24.64, paring earlier losses of as much as 22 percent.
"Negative external attention continues to adversely impact the business and our reputation with patients, physicians and all of you, our shareholders, as well as our distracted organization," Chief Executive Joe Papa, who took over in May, said during a conference call with analysts.
He did not directly answer a question on whether there had been takeover offers for Valeant.
Ruane, Cunniff & Goldfarb Inc, one of Valeant's biggest shareholders, cut its stake by more than half to 4.7 percent as of May 31, it said in a regulatory filing.
The investment firm that runs the Sequoia Fund, long known for its ties to Warren Buffett, was sued by shareholders who claim it recklessly took a huge stake in Valeant. Continued...