Joseph Papa, Valeant’s chairman and chief executive, said the company’s dermatology business continues to underperform and it will continue to work towards resolving its legacy legal issues. Ryan Remiorz/Canadian Press
Valeant Pharmaceuticals International said Tuesday it’s making progress toward resolving the legal and financial issues that have beset it for nearly two years.
The beleaguered drug company said it’s ahead of schedule on a critical debt reduction program and expects to exceed its commitment to pay down $5 billion in debt before February 2018.
Moreover, Valeant’s core businesses вЂ” Bausch + Lomb/International and Salix вЂ” grew their combined revenue by eight per cent after excluding the impact of divestitures.
“We clearly are looking at what we think are exciting opportunities for the future of Valeant,” said CEO Joseph Papa.
He noted that Valeant’s dermatology business continues to underperform and it will continue to work towards resolving its legacy legal issues.
“And that will really be our focus for the next three months and next year,” Papa said.
The company has been selling assets and using the money to reduce its debt in recent months.
Valeant recently closed the sale of Dendreon Pharmaceuticals and used net proceeds to pay down $811 million US of senior secured term loans. It has also announced deals to sell its iNova Pharmaceuticals business for $930 million US and Obagi Medical Products for $190 million US. Both deals are expected to close in the second half of this year.
Earlier, Valeant announced its second-quarter loss was reduced to $38 million US attributable to shareholders as the company sold assets and reduced debt. The loss amounted to 11 cents per share compared with a loss of $302 million or 88 cents per share for the 2016 second quarter.
Revenue also fell year-over-year to $2.23 billion US from $2.42 billion US. Adjusted earnings before interest, taxes, depreciation and amortization slipped to $951 million for the second quarter of 2017, from $1.09 billion last year.
The company attributed the drop in revenue to several factors, including lower prices for some products and the divestiture of a skin care business within its Bausch + Lomb/International business.
Valeant also lowered its 2017 revenue guidance range to between $8.70 billion and $8.80 billion, from between $8.90 billion and $9.10 billion, citing the divestitures вЂ” which have been key to reducing its debt and improving profit margins.
The company says it’s on track to achieve between $3.60 billion and $3.75 billion in adjusted earnings before interest, taxes, depreciation and amortization this year.
Valeant shares rose 59 cents to close at $19.74 on the Toronto Stock Exchange.
But the stock remains a shadow of its former self when it traded for more than $300 before a series of events that included questions about the sales it generated through online pharmacy Philidor Rx Services.
The company also came under political and regulatory scrutiny in the United States and replaced chief executive Michael Pearson.