...Valeant Pharmaceuticals Arif Mitha Management 2130 – 007 March 30, 2016 Donovan Lawrence Valeant Pharmaceuticals Pharmaceutical companies committing unethical business practices is so common place in society now that is can be considered a cliché. Companies like Valeant, Turning and even Johnson and Johnson, have all been in the news over unethical business practices whether they be price gouging, monopolization or product misrepresentation; each of these circumstances has caused an uproar from consumers and even federal government agencies are now beginning to investigate these companies for wrong doing. Valeant Pharmaceuticals is the most recent perpetrator of predatory pricing; on February 10, 2015 Valeant purchased the rights to a pair of life saving heart drugs Nitropress and Isurprel, on that same day the price rose 525% and 212% respectively (Rockoff & Silverman. 2015, p.1). Internal and External Environment When a company makes a decision like this, many internal and external factors much be evaluated before deciding to push forward. P.E.S.T.L.E. Analysis The relevant external factors affecting this industry are primarily the Political, Economic, and Legal forces. Political | * Hiliary Clinton attacking Valeant for predatory pricing. * Testifying in front of Congress for the severe price hikes of Nitropress and Isuprel * Potential loss of $300 million a year if congress forces Valeant to revert to original prices | Economical | * “Duty...
Words: 1373 - Pages: 6
...program began and my goal of this simulation program was trying to increase the value of the portfolio with minimizing the risk before April 15, 2016, which is the last trading day. Throughout the duration of the assignment, as investing strategies were discussed in class, I began to take more of an academic approach in regard to my investment strategy. I began to not only rely on news articles but I also analyzed company financials, giving me a better picture of the company as a whole. I decided to buy stock in safe, well-established companies that I new would give me a steady profit. That strategy worked pretty well for me, I made a profit with Alibaba, Starbucks and Wal-Mart. I made the biggest profit with Alibaba “ $18,139 and Valeant Pharmaceuticals International Inc “ $20,161, while I made only minimal profit with the others. However, I failed to make a profit with Direxion Daily Russia Bear 3X ETF and Momo Inc, losing a total over $20,000 with each. I decided to take a chance and buy some stock in companies that I was not familiar with and achieved slight success doing so. I used various articles available on Stock Trak such as, Stocks to Watch, The Market Story, and Market Update, as my guide to buying stocks in unfamiliar companies, I received my biggest profit with VS 3X WTI CRUDE at $12,870 and Direxion Daily FTSE China Bear 3X ETF at $12,280. Both of these two stock are 3 X ETF, which seeking a return that is +300% or -300% of the return of their benchmark index...
Words: 412 - Pages: 2
...Case Study 3.1 Teva Acquires Cephalon in a Hostile Takeover in the European Market for Corporate Control 1. While Valeant was more likely to be an aggressive cost cutter, both firms anticipated improving earnings performance through significant cost savings by combining operations and eliminating duplicate overhead. Valeant also believed Cephalon would complement their own offering. Teva was under pressure to diversify its product offering to include a greater percentage of higher margin branded drugs. Like many pharmaceutical companies, they were vulnerable to the loss of patent protection on a key drug and were seeking access to a firm with a substantial number of new drugs under development. 2. Both firms initially approached Cephalon on a friendly basis, interested in avoiding an auction for the target and the potential for customer attrition, loss of key employees, and disruption to suppliers if the acquisition became hostile. However, Valeant decided to pressure the target by going directly to the shareholders with an all-cash hostile tender offer. Simultaneously, the firm initiated a proxy fight in an attempt to change the composition of the Cephalon board in order to have the board rescind the firm’s shareholder rights plan (poison pill), which if triggered would have increased the cost of the takeover. Valeant used a consent solicitation card which would enable Cephalon shareholders to support Valeant’s slate of directors without scheduling a formal shareholders...
Words: 582 - Pages: 3
...Revenue Recognition Analysis 3 (ii). Strength and Weaknesses of Biovail 3 RECOMMENDATIONS 4 CONCLUSION 5 INTRODUCTION Biovail corporation was one of Canada’s largest publicly traded pharmaceutical companies. Biovail is a specialty pharmaceutical company engaged in the formulation, clinical testing, registration, manufacture and commercialization of pharmaceutical products, utilizing advanced drug-delivery technologies. The company currently has over 20 distinct, proprietary drug-delivery technologies and has access to other technologies through licensing agreements with development partners. In September 2010, the stockholders of Biovail Corporation and Valeant Pharmaceuticals International voted in favour of combining the two companies to become one under the Valeant name. The new combined company is known as Valeant Pharmaceuticals International, Inc. and its shares are traded on both the New York Stock Exchange and the Toronto Stock Exchange. In the case, on September 30, 2003, a truck of Biovail carrying a shipment to Biovail’s Distributor, was involved in a multi-vehicle traffic accident near Chicago. David Maris found that Biovail intentionally and falsely attributed nearly half of its failure to meet its third quarter 2003 earnings guidance to a truck accident. Biovail intentionally misstated both the effect of the accident on Biovail’s third quarter earnings as well as the value of the product involved in the truck accident. In fact, the accident had no effect on...
Words: 2292 - Pages: 10
...The American Healthcare system has a history of chaos and unruliness. Despite the recent implementation of the Patient Protection and Affordable Care Act (commonly called the Affordable Care Act or Obamacare) costs of pharmaceuticals continue to rise. In addition to the spiraling costs of the health care system, pharmaceutical companies continue to benefit from high profit margins while Americans are left paying three times as much for the same medications as other nations across the globe (Picchi 2015). In order for the Obama Administration to achieve their goal of healthcare for every American, legislation must be implemented that allows price negotiation among medical providers, the federal government and the pharmaceutical companies. Despite the persistent claims by many high ranking elected officials, such as former Senate Majority Leader John Boehner, that America has the best health care system in the world, there's insufficient evidence that Americans are getting higher-quality medical treatment or enjoying healthier lives than our counterparts abroad (Jacobson 2012). According to the Commonwealth Fund, Healthcare in America costs more than in other industrialized nations and Americans aren't getting the world's best care for their dollars, according to a new study. The United States spent $7,960 per capita on health care in 2009, the most of 13 industrialized nations in the Organization for Economic Cooperation and Development. That's almost three times the amount...
Words: 2364 - Pages: 10
...a subsidiary of a new holding company in a different tax regime so as to enjoy beneficial tax laws. The investment opportunities available in the drugs industry are tremendous. The industry offers a wider base for the investment of 3%+ yielding equities that can offer financial strength and a high degree of safety. The drug industry does not fall in the upper half of the best performing sectors. A majority of the companies within the drug industry are ranked as average, these are companies like GlaxoSmithKline, Merck and Pfizer. Other companies that are ranked below the average industry standard include AstraZeneca, Novartis and Eli Lilly. The companies that are ranked in the top half of the best performing sectors include Actavis and Valeant. This is an important factor for investment purposes as good financial performance drives the investment opportunities within the best performing industries. However, despite the turbulent factors within the industry, the industry has gone through a significant transformation offering a safe,...
Words: 2155 - Pages: 9
...Government Reform is researching Shkreli's choice to raise the cost of the life-sparing drug from $13.50 per pill to $750. Shkreli has contended the Daraprim cost increment was justified in light of the fact that the medication is specialised. The business claims its goal will concentrate on medicines for serious diseases for which there are limited alternatives. "We are committed to helping patients, who often have no successful treatment choices," an announcement on Turing's site said. So far the uproar over drug pricing has created a noteworthy headache for pharmaceutical firms but few results. Several dug companies have made comparative moves raising the cost of rarely used medication, however few have so openly addressed these issues. Valeant Pharmaceuticals raised the cost of heart prescriptions Isuprel (525 percent) and Nitropress (212 percent), among others. Drug organizations enjoy patent security on their medicines for a long time from the date of filing, and can change the recipe slightly to reset the clock, or pay the non specific producers to force them to quit making alternatives. They can likewise buy drugs on the open business sector, distinguishing profit making opportunities with the security that no one can confine what they charge. Organizations can likewise get selective advertising rights for a medication for anywhere in the range of six months to...
Words: 455 - Pages: 2
...The first step of research in my own words would be almost the same as a student’s guide to research. Meaning, I would first have to have a good understanding of the topic being discussed. I would do research finding out different information on the target topic of the research. One of the major assumptions and bias of the drug industry does not fall in the upper half of the best performing sectors. A majority of the companies within the drug industry are ranked as average; these are companies like GlaxoSmithKline, Merck and Pfizer. Other companies that are ranked below the average industry standard include AstraZeneca, Novartis and Eli Lilly. The companies that are ranked in the top half of the best performing sectors include Actavis and Valeant. This is an important factor for investment purposes as good financial performance drives the investment opportunities within the best performing industries. The Drug industry has registered positive financial performance in the third quarter of 2014 having registered tremendous profits. There is a high impact on Society of drugs. It was found that drugs and crimes are interrelated, as demonstrated by researches done by the United States National Institute of Justice. The major impact on drug-addicts is that they prone to commit crimes. They need money to finance their drug taking habit and for that they seldom have money, so they indulge themselves in petty...
Words: 387 - Pages: 2
...Record: 1 | BlackBerry blues. By: McMAHON, TAMSIN. Maclean's. 6/4/2012, Vol. 125 Issue 21, p32-34. 3p. Abstract: The article discusses the decline of the Canadian technology company Research In Motion (RIM), the creator of the BlackBerry smartphone, as of June 2012. Topics include competition in the global smartphone market, RIM's corporate investments in research and development (R & D), and the failure of the telecommunications equipment manufacturer Nortel. (AN: 76358166) | | | Persistent link to this record (Permalink): | http://ezproxy.lib.ucalgary.ca:2048/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=76358166&site=ehost-live | | | Cut and Paste: | <a href="http://ezproxy.lib.ucalgary.ca:2048/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=76358166&site=ehost-live">BlackBerry blues.</a> | | | Database: | Business Source Complete | Section: Business TECHNOLOGY The once-mighty RIM is fighting for its life. What that means for a Canadian tech sector still suffering from the loss of Nortel To get a sense of how deeply intertwined the Canadian identity has become with the BlackBerry, this country's most famous modern-day invention, pick up a copy of the study guide issued by the federal government to help new immigrants prepare for their citizenship test. There, among the handful of inventors whose work is so critical to the country's history that their names...
Words: 2542 - Pages: 11
...Julius Chen George Chiu Armen Odadjian Mengyang Wu FBE459: Stock-Trak End of Semester Report Our portfolio had a return of +6.97% as of November 28th compared with a +3.86% return on the S&P 500 in the same time period. We ended with a Sharpe Ratio of 4.30 and portfolio beta of 0.23. Over 136 trades, we employed various option strategies, longed and shorted equities, speculated on commodities with futures, and invested in fixed income securities. Listed below are a few highlights and in-depth analysis of the strategies that we used. Protected Put Ticker | Position | Cost | Strike | S0 | ST | Profit/Loss | MU | Long | | | 30.61 | 34.30 | +$369.00 | | Buy Put | 1.72 | 31 | 30.61 | 34.30 | -$172.00 | DVN | Long | | | 59.02 | 67.20 | +$818.00 | | Buy Put | 1.60 | 57.5 | 59.02 | 67.20 | -$160.00 | SSYS | Long | | | 116.63 | 102.42 | -$1,421.00 | | Buy Put | 6.70 | 115 | 116.63 | 102.42 | +588.00 | *where S0= price at position open and ST=price at position close On October 22, we entered into three protect put strategies for Micro Technology (semiconductor maker), Devon Energy Corp. (energy company), and Stratasys, Ltd. (3-D printer maker). Our team believed that each company would outperform their peers in their perspective industries. Each company, however, operates in volatile industries. The semiconductor industry suffers from cyclical demand and producers often see margins slashed due to constant price wars. The stock prices of energy companies often...
Words: 3188 - Pages: 13
...www.pwc.com/us/pharma Aspiring giants How small pharmas can drive to $1 billion — and beyond PwC’s PRTM Management Consulting Aspiring giants Executive summary Amid the volatile blend of opportunity and challenge that characterizes the global pharmaceutical industry, only a few small companies have managed to catapult their revenue over the $1 billion mark over the past two decades. Whether they chose to expand their therapeutic area focus and product portfolios, enter new geographies, or grow their core business, these aspiring giants pursued three distinct strategies to jump-start growth: Leveraged core product and technology capabilities to launch differentiated products Used mergers and acquisitions to gain new products and/or expand geographic presence Built a strong, stable leadership team armed with a compelling vision and relentless drive The experiences of these winning companies offer lessons for today’s smaller pharma companies harboring the ambition to reach the $1 billion revenue mark. To achieve this milestone, these companies will need to excel in three areas: expanding a core area of expertise to deliver niche and valueadded products, adopting an acquisition and partnering mindset to expand product offerings and geographic presence, and attracting and retaining talented leaders. Focusing on these fronts can help position a pharma company to become a growth leader—rather than merely a follower—in tomorrow’s...
Words: 4167 - Pages: 17
...INDIAN PHARMACEUTICAL INDUSTRY – AN OVERVIEW 1. Overview The Indian Pharma industry is one of the fastest growing sectors with approximately 20,000 manufacturing units. The industry that is highly price sensitive ranks thirteenth in the global pharmaceutical market in value terms and fourth in volume terms. The country has tremendous export potential in the areas like custom synthesis, R&D, clinical trials, and Bioinformatics. The industry produces 60,000 finished medicines and roughly 400 bulk drugs, which are used in formulations with about 20% of the manufacturers in the bulk drugs segment. India has approximately 1% share of global pharma industry, which is worth US$406 billion. This implies that there is a huge market waiting to be unfolded. The figure below explains the evolution of Indian pharmaceutical industry: Figure 1: Progress Of Indian Pharmaceutical Industry Source: Pharmabiz.com (Article by Dr. Laxman Prasad) 2. Industry Structure and Size 2.1 Industry Structure The Indian Pharma industry is highly fragmented and can broadly be classified in to two categories: organized and unorganized sector. Figure 2: Revenues of Organised vs. Unorganised Sector Source: Secondary Research The organized sector contributes about 70% of the total revenues and consists of 260 units in both manufacturing as well as formulation segment. This sector can further be divided into Indian and multinational companies. The unorganized sector is...
Words: 1530 - Pages: 7
...are considered medicine while natural herbs and essential oils are thought of as mere potions or even sorcery by the FDA and traditional pharmacology business commonly referred to as Big Pharma. Big Pharma, derived from PhRMA-the Pharmaceutical Research and Manufacturers of America, is worth roughly around 300 billion US dollars and wields enormous influence over modern Western medicine, insurance, litigation, government, and health with leverage from huge profits and about 3,000 paid lobbyists. Harvard Business School Professor William George asked, “Is the role of leading large pharmaceutical companies to discover lifesaving drugs or to make money for shareholders through financial engineering?” Pfitzer made a bid to buy AstraZeneca and Valeant Pharmaceuticals International takeover bid for Allergan have monetary gains of lower tax liabilities and another income stream. Biopharmaceutical companies are expensive to run under high risk-only significant profits will guarantee solvency. Clinical trials and drug development are chosen by the significant profit margin and medical breakthrough. For example, aspirin has been a generic drug since 1919 with a cost less than $6.00 for a year supply and may improve survival and reduce the recurrence of some cancers. But running clinical trials to prove or disprove the benefits of aspirin in cancer treatment will not produce a monetary return of investment leaving investors with no interest to invest in a pharmaceutical company without a high...
Words: 1401 - Pages: 6
...------------------------------------------------- Portfolio Composition The Money Team designed this portfolio September 27th, 2013 with the plan to invest mainly in large cap and high growth U.S equities. All equities were purchased on that date with the intention to hold them until December 6th, 2013. The primary goal of this portfolio was to maximize growth and value of the portfolio through an active investment strategy. This portfolio was concentrated in large cap U.S equities and domestic mutual funds. There was a blend of small cap growth stocks, which were selected based on potential for large growth. This decision was in line with our primary goal of maximizing growth. The portfolio is highly focused in the technology sector in order to capitalize on advance in the short-term. The portfolio is tailored to an investor with high-risk tolerance. The Money Team held on to its U.S equities throughout the course of the time horizon. The only changes The Money Team made to its portfolio during the time horizon was selling underperforming bonds. Below is the holding period return data for each of The Money Team’s assets: Company Name | QTY | Currency | Price Paid | Last Price | Profit/Loss (local curr) | P/L % | 3-D Systems Corp (Delaware) | 100 | USD | $55.96 | $75.38 | $1,942.00 | 34.70 | Rite Aid Corp | 1000 | USD | $4.59 | $5.75 | $1,160.00 | 25.27 | Virtus Investment Partners Inc | 100 | USD | $168.00 | $202.04 | $3,404.00 | 20.26 | Nokia...
Words: 3822 - Pages: 16
...The Wall Street Journal Private-Equity Firms Notch Up Gains but Face Investing Challenges; Strong Debt and Stock Markets Have a Flip Side By Ryan Dezember Feb. 20, 2014 In a year of record-setting profits, the big publicly traded U.S. private-equity firms were rewarded by investors with billions of dollars of new money for their next round of buyouts. Yet the same frothy debt and stock markets that have made it an ideal time for these firms to sell companies have made it increasingly difficult to buy new ones. "It was a challenging year to invest, particularly in the United States," Carlyle Group LP's co-founder and co-chief executive, William Conway, told investors Wednesday after the firm reported its fourthquarter and full-year earnings. "This was the flip side of robust public markets and low interest rates." The fourth quarter was Carlyle's most profitable as a public company, with earnings up sharply from a year earlier. Carlyle's economic net income, a measure of profits favored by buyout firms, was $576 million, or $1.64 a share, up from $182 million, or 47 cents a share, a year earlier. Analysts polled by FactSet forecast 96 cents a share. The Washington firm sold $6.3 billion in assets in the fourth quarter to fuel the gains. Those sales came predominantly from its corporate buyout funds, which shed big stakes in companies such as ratings firm Nielsen Holdings NV and Allison Transmission Holdings Inc. as well as entire companies. For the year, Carlyle reaped deal...
Words: 3628 - Pages: 15
