Valeant shareholders pressure company at annual meeting
CEO says company still considering proposal to change name
Shareholders in Valeant Pharmaceuticals used the company's annual general meeting Tuesday as a forum to vent their frustrations at lingering issues that have dragged down their investment in the drugmaker.
CEO Joseph Papa heard from investors who said they were unhappy with several issues that have plagued Valeant, such as its low share price and an insufficient response to negative media coverage.
"Last year I was very angry, very upset and frustrated at what happened to the company," said one shareholder at the company's headquarters in Laval, north of Montreal.
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The grumbling came after Papa said Valeant is making progress to stabilize itself after nearly two years of challenges, including a stock price that has plummeted from nearly $350 on the Toronto Stock Exchange in August 2015 to almost as low as $10.
On Tuesday, its shares climbed for a second day in a row, gaining almost seven per cent to close at $14.11.
Papa said he understands why shareholders are upset, adding that he believes Valeant's stock doesn't reflect its value because of legacy issues including its massive debt.
After spending the past year cutting US$3.6 billion from its US$32 billion debt, Papa said the meeting marks the first day of a new era for Valeant.
"I believe we can turn this around," he later told reporters.
Still, Papa warned it's not a simple process and he expects a couple of years will be required to repair the business and improve its financial results.
He said he remains committed to cutting Valeant's debt by US$5 billion through non-core asset sales and operational results by February. The company is targeting up to $8 billion worth of asset sales by that date. It has delivered US$2.7 billion so far.
After refinancing its obligations, Papa said the company has "the luxury of some time" to use its auction processes to gain the best price.
Reducing debt is one of Valeant's biggest challenges but Papa said he would like to get it down to between US$15 billion and US$20 billion over several years.
Papa also told shareholders he is still examining the possibility of changing the company's name given the negative perception surrounding it, something he first mused about last year. He wouldn't say when a decision will be made.