If any company has had a tough past three years it has been Valeant Pharmaceuticals International Inc. (NYSE: VRX). The company has gone from a Wall Street darling, and a massive holding at Bill Ackman’s Pershing Square Hedge Fund, trading at over $260, to a specialty pharmaceutical company doing everything to straighten the ship, and recently that ship had been sailing in the right direction, at least until now.
The company received some bad news, and shares were down over 5% in premarket trading Monday after the Food and Drug Administration (FDA) failed to approve the company’s lotion intended to treat plaque psoriasis. Ortho Dermatologics, a division of Valeant, today announced that it has received a Complete Response Letter (CRL) from the FDA regarding the company’s New Drug Application (NDA) for DUOBRII 1 (halobetasol propionate and tazarotene) (IDP-118) lotion in the treatment of plaque psoriasis.
Company CEO and Board Chair Joseph Papa said this when addressing the ruling:
“The CRL did not specify any deficiencies related to the clinical efficacy or safety of DUOBRII and no issues with CMC* processes. The CRL only noted questions regarding pharmacokinetic data,” “We are working to resolve this matter expeditiously and have already requested a meeting with the FDA. We hope to bring forward this important new treatment option for those who suffer from plaque psoriasis as quickly as possible.”
The stock had been on a roll, up over 60% over the past 90 days, and far outperforming the large benchmarks. Papa has been instrumental in leading the company back from the Pershing Square debacle and subsequent stock slide that started almost three years ago.
Prior to joining the company, Papa had more than 15 years of experience leading pharmaceutical companies. From 2006 to 2016, he was the board chair and chief executive of Perrigo. From 2004 to 2006, Papa was chair and CEO of the pharmaceutical and technologies services of Cardinal Health. From 2001 to 2004, he was president and chief operating officer of Watson Pharmaceuticals.
Valeant has traded in a 52-week range of $10.94 to $27.79 a share. The shares traded at $25.52 in Monday’s premarket action, and that compares with a close last Friday at $26.86.