Valeant makes progress on legal, financial woes

TORONTO — Valeant Pharmaceuticals International (TSX:VRX) said Tuesday it’s making progress toward resolving the legal and financial issues that have beset it for nearly two years.

The beleaguered drug company said it’s ahead of schedule on a critical debt reduction program and expects to exceed its commitment to pay down $5 billion in debt before February 2018.

Moreover, Valeant’s core businesses — Bausch + Lomb/International and Salix — grew their combined revenue by eight per cent after excluding the impact of divestitures.

“We clearly are looking at what we think are exciting opportunities for the future of Valeant,” said CEO Joseph Papa.

He noted that Valeant’s dermatology business continues to underperform and it will continue to work towards resolving its legacy legal issues. “And that will really be our focus for the next three months and next year,” Papa said.

The company has been selling assets and using the money to reduce its debt in recent months.

Valeant recently closed the sale of Dendreon Pharmaceuticals and used net proceeds to pay down US$811 million of senior secured term loans. It has also announced deals to sell its iNova Pharmaceuticals business for US$930 million and Obagi Medical Products for US$190 million. Both deals are expected to close in the second half of this year.

Earlier, Valeant announced its second-quarter loss was reduced to US$38 million attributable to shareholders as the company sold assets and reduced debt.

The loss, reported in U.S. dollars, amounted to 11 cents per share compared with a loss of $302 million or 88 cents per share for the 2016 second quarter.

Revenue also fell year-over-year to US$2.23 billion from US$2.42 billion.

Adjusted earnings before interest, taxes, depreciation and amortization slipped to $951 million for the second quarter of 2017, from $1.09 billion last year.