Shares of Valeant, buyer of B&L, slump on Q3 report

By WILL ASTOR - 10/31/2013 5:45:45 PM

Valeant Pharmaceuticals International Inc. saw its share price dip Thursday following the company’s report of a third-quarter loss of $973.2 million, or $2.92 a share, on revenues of $1.5 billion.

The results compare with a $7.6 million, or 2 cents a share, profit on revenues of $853.7 million in the third quarter 2012.

Onetime charges, including $305 million related to the Quebec-based Valeant’s August acquisition of Bausch & Lomb Inc., helped drive third-quarter red ink, the company said.

Other onetime charges the company booked in the quarter were: a $645 million impairment charge related to the discontinuation of the modified-release formulation of an anti-seizure drug jointly developed by Valeant and GlaxoSmithKline PLC and provision for an agreement to pay Anacor Pharmaceuticals Inc. $142.5 million to settle Anacor’s breach of contract claim.

The unexpected early launch of a generic competitor to Valeant’s Retin-A-Micro and a strong U.S. dollar’s effect on currency exchanges also cut into third-quarter profits, the company said. The acquisition of Bausch & Lomb contributing to increases in developed and developing market revenues, Valeant said.

“Despite an unexpected early launch of a generic Retin-A Micro, significant headwinds this quarter from foreign exchange movements, and the demands of a major integration, we managed to beat expectations and position Valeant for a terrific fourth quarter and a strong 2014,” Valeant chairman and CEO Michael Pearson said.

The company said it expects to realize more than $850 million of cost synergies from the combined company, created with Bausch & Lomb Acquisition, with a run rate north of $500 million by year-end 2013.
On Thursday afternoon, Valeant shares (Nasdaq: VRX) were trading at $106.29, down $2.79.
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