Valeant Pharmaceuticals' former CEO and CFO are allegedly the focus of a criminal investigation, Bloomberg reported citing sources.
The company's U.S.-listed shares were down as much as 7.8 percent after the news.
Sources told Bloomberg that U.S. prosecutors may be building a fraud case against the embattled pharmaceutical company and that charges could be brought forward in a matter of weeks.
Former Valeant CEO Michael Pearson was ousted from the company in March, a decision that a person familiar with the situation told CNBC "was not mutual."
The Canadian drugmaker came under fire when The New York Times reported that Valeant and other pharmaceutical companies were using a network of specialty pharmacies to sustain sales of their high-priced drugs and prevent patients and insurers from switching to cheaper generic drugs. Citron Research subsequently published a note calling Valeant the "pharmaceutical Enron."
In response, Valeant formed an ad hoc committee to review the allegations regarding specialty pharmacy Philidor RX Services. The U.S. Securities and Exchange Commission is investigating the relationship between the two companies.
Read the full report on Bloomberg.
This story is developing. Please check back for further updates.
Valeant shares drop on report of criminal probe of ex-CEO and CFO
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