* Greater clarity for investors "sorely needed" -analyst
* Unclear how Valeant will look in 18 months -former investor
* New CEO Papa tackling issues head-on -PR expert
By Allison Lampert
LAVAL, Quebec, June 14 (Reuters) - The new chief executive of Valeant Pharmaceuticals International Inc, Joe Papa, will appear before investors at the company's annual meeting for the first time on Tuesday, likely facing hard questions after months of bad news torpedoed its stock.
Valeant's meeting in Laval, Quebec, comes as its share price trades 90 percent lower than in August 2015, weighed down by concerns over its acquisition binge of recent years, use of a specialty pharmacy and backlash over massive price increases for some drugs.
Greater clarity on the company's direction is "sorely needed" for investors, along with evidence that it can generate substantial free cash flow, said Raghuram Selvaraju, analyst at Rodman & Renshaw, a unit of investment bank H.C. Wainwright.
"They cut guidance to a point where now if there are any additional disappointments, any further negative surprises, any further reductions in guidance, there's going to be a crisis of confidence in the company regarding whether or not they can continue to meet their debt covenants," he said.
Valeant declined to comment.
For Papa, a seasoned pharmaceutical industry executive who took the reins in May, there was no honeymoon. The company last week cut its 2016 forecast and said it would consider selling assets to pay down its $31 billion debt.
Shares fell nearly 15 percent that day.
"I don't think Valeant is in a place right now to know exactly what the company looks like 18 months from here," said Patrick Kaser, portfolio manager at Brandywine Global. "The uncertainty certainly rose meaningfully (last) week. There's more doubt."
Valeant's diminished outlook helped convince Brandywine to sell its position in the company last week.
Kaser said he and some other investors met Papa after Valeant's quarterly call. Some, he said, wanted to know what the future holds for Valeant's faltering distribution agreement with pharmacy chain Walgreens Boots Alliance Inc. Others want to know what assets it will sell, he said.
Papa's "playbook" for soothing investors should be simple - outline a turnaround plan and address concerns directly, said Patrick Hillmann, a senior vice-president at public relations firm Levick.
"A lot of times, CEOs will try to run from their problems, and I think he has for the most part turned it around and taken some of these issues head-on," said Hillmann, whose firm is not working with Valeant.
Billionaire investor Bill Ackman, whose Pershing Square Capital Management is Valeant's biggest shareholder, also will attend the meeting. A spokesman for the New York-based hedge fund declined to comment.
In a letter to investors, Ackman called Papa "an ideal choice for Valeant," citing his reputation for integrity and his performance as CEO of Perrigo Company PLC.
Privately, Ackman has talked about the effects of Valeant's stock price drop on his own portfolio as has told some clients he expects redemptions to be higher for the second quarter than in past quarters when investors pulled out less money than usual, one investor said. (Additional reporting and writing by Rod Nickel in Winnipeg and Svea Herbst-Bayliss in Boston; Editing by Matthew Lewis)