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Valeant focused on bringing new products to market, receives CRL

Published on 09/08/17 at 10:10am

In its second quarter financial reports, Valeant strove to strike a positive note. It revealed that it had paid down $4.8 billion on its mountain of debt since the first quarter of 2016 and CEO, Joseph Papa, said that the company would focus on launching new products, instead of selling parts of the business, to further reduce this.

This message was marred slightly by the previous day’s news, which revealed that the aim of bringing new products to market had been missed on its eye drug that had been issued a second CRL on manufacturing issues.

What makes this stumble puzzling is that the CRL issued by the FDA cites exactly the same cGMP issue at Valeant’s Tampa, Florida, facility as in the previous year’s CRL.

This failure to rectify the issue that had already been highlighted raises some serious questions. Valeant had previously suggested the product, latanoprostene bunod ophthalmic solution, 0.024%, could be a blockbuster seller in the treatment of open angle glaucoma or ocular hypertension.

The eye drug comes from the Bausch & Lomb group of the company, which could have used the boost to revenue after seeing this decrease by 3% from the same time last year.

An area of positivity for the company came in form of its Salix unit – a one-time target for Takeda – that displayed growth of 13% in revenue against the second quarter of 2016. This was driven by the success of its Xifaxan product, a 2-week treatment for irritable bowel disorder where diarrhoea is the main symptom.

“As we think about the future the very clear direction we have is going to be to grow this business as a result of launching new products,” Papa told analysts at a second quarter earnings call.

This rules out a move to sell the Salix unit, a move that was mooted as a means of paying down a substantial portion of its debt, with the company valued at around $10 billion. Total debt at the company currently stands at approximately $28 billion and Papa indicated that the company would focus on maintaining its debts through revenue generated by the company.

Ben Hargreaves

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