Ackman boosts stake in Valeant to 10%

Activist investor Bill Ackman’s hedge fund has significantly increased its investment in Valeant Pharmaceuticals International, and signaled it may play a greater role in the beleaguered drugmaker’s strategy, according to a regulatory filing.

Ackman’s Pershing Square Capital Management raised its stake in Valeant to 9.9 percent from the 5.7 percent it reported in March, according to a filing on Monday with the Se curities and Exchange Commission. Shares in the company rose 3.1 percent in afterhours trading.

Pershing Square noted in its filing that it may conduct discussions with Valeant management, other shareholders and relevant parties “including other companies in (Valeant’s) industry” about the drugmaker’s strategic plans and other matters. The language about contacting other drugmakers did not appear in its first ownership filing in March.

The disclosure comes at a time of heightened speculation about the future of Valeant, which is under scrutiny for steep price hikes on its drugs to boost profits and for its close ties to a specialty pharmacy that used aggressive tactics to get insurers to reimburse the cost of its medicines.

Some key Valeant investors have questioned whether Chief Executive Michael Pearson should step down. Ackman earlier this month expressed confidence in Pearson’s leadership. People familiar with Ackman’s thinking have said the billionaire is open to considering alternatives for Valeant’s future, including a sale.

Valeant shares have seen steep losses, declining in value from more than $260 per share in August to a low of $69.34 last week. It closed down 4 percent Monday, at $87.34.