The chief executive of embattled Valeant Pharmaceuticals, J. Michael Pearson, has agreed to be deposed by a Senate committee investigating the causes of soaring prescription medicine prices.
Meanwhile, the Canadian drugmaker has received a notice of default from some bond holders because it hasn’t filed a financial report due in March. That’s been delayed by a review of company accounting practices, which found Valeant prematurely reported $58 million in sales in 2014 to its former partner, mail-order pharmacy Philidor. Valeant now is revising earlier financial statements related to that.
Valeant Pharmaceuticals International Inc. said the default notice was filed by holders of its 5.5 percent notes due for repayment in 2023. To resolve the default, Valeant must file its 2015 financial report by June 11, but it expects to do so by April 29, the company said in a statement.
If it doesn’t file by June 11, Valeant would be in default and bond holders could demand accelerated repayments, Citi Research analysts wrote to investors Wednesday.
Due to the default notice, Moody’s Investors Service lowered Valeant’s speculative grade liquidity rating by one notch and said its other ratings are under review for a downgrade.