The Investigation Into The Practices Of Valeant Pharmaceuticals
There is an investigation on behalf of the shareholders of Valeant Pharmaceuticals regarding US security law violations. Due to fraudulent practices allegedly practiced by their management the investors in VRX have suffered significant losses. The reports are claiming Valeant Pharmaceuticals has refilled prescriptions without the permission of the patients. This led patients to purchase drugs that were more expensive with the purpose of raising the companies profits and sales. This caused the company to be overvalued by their investors.
The lawsuit was recently filed by a large pension fund. They are investors in VRX and claim Valeant has a network of pharmacies that are kept secretly. They believe these pharmacies are inflating the sales of their drugs with improper and fraudulent practices. This includes changing the prescriptions written by doctors to Valeant products instead of the alternative of lower priced generics. The lawsuit states these prescriptions have been refilled automatically for Valeant drugs despite the fact refills were not required by the patients. Contact our lawyers to protect your rights regarding this lawsuit.
The Losses Of VRX Shareholders
The investors in Valeant Pharmaceuticals have cut the company’s value in half. The stock dropped over 51 percent in just one day because of the fear the company would default on their debt. The earnings of the company were also weaker than normal and analysts have cut the forecast of the company for 2016. Inside of one week Valeant stocks value is down 61 percent.
The company has lost almost $13 billion in their market capitalization. According to the analysts Valeant was expected to have a profit of almost $463 million. The company instead reported a loss of $336 million. According to Valeant the loss was due to restructuring and acquisition costs. Their yearly report for the Securities and Exchange Commission has been delayed.
An internal investigation has been started by the company regarding their relationship to Philidor. Philidor is an online pharmaceutical company. Valeant stated $55 million in sales went to Philidor at the wrong time. Valeant is now responsible for restating all of their earnings for both 2014 and 2015. If the SEC does not receive this report on time Valeant will be in the position of defaulting on their debt of $30 billion. Many VRX investors have expressed concern over the impending VRX shareholder lawsuit.