It hasn't been this bad for Valeant in months

Valeant Pharmaceuticals is taking a beating. The shares are down 14% on Monday, at levels they hadn't hit since November.

Wall Street is still talking about a 40-page report Wells Fargo analyst David Maris put out about the company on Friday. In it, Maris questioned whether the company could survive on a business model that emphasizes sales volume rather than price increases.

The stock has fallen almost 15% since the report landed last week, and it is now trading close to $75 a share. Maris has a target of $65 to $68, or as much as 13% below current levels.

Valeant was forced to change its model after accusations from a short seller and government scrutiny brought its aggressive pricing practices to light. The company had to terminate its relationship with a secret pharmacy called Philidor, and company executives have been called to Washington to explain how they set prices.

Valeant signed a new distribution deal with Walgreens to make up for the loss of Philidor, but Maris doesn't think it will work out so well for the company.

And Maris is very clear about another danger: the fact that Valeant is sitting on $30 billion of debt - which, in fairness, it has said it will spend 2016 paying down - but actually doesn't have that much in tangible assets.

In fact, if you take out intangible assets, like goodwill for future sales, you have a company very, very much in the red, From Wells Fargo [emphasis ours]:

Approximately 82% of Valeant's total assets are made up of goodwill and intangibles. We calculate Valeant's tangible assets, plus cash, as $6.7 billion as of September 30, 2015. When we subtract total debt, we arrive at a value of approximately ($24) billion.

We have reached out to Valeant for a response.

Maris says Valeant's practice of cutting research-and-development spending already made it necessary for the company to impair goodwill after some time and current issues with the company can only make that worse.

If Valeant is forced to impair goodwill or certain intangibles, its leverage ratios and balance sheet risk could further increase. Given the significant leverage that Valeant's balance sheet is currently supporting, we find this possibility to be very concerning and believe investors should be aware of this risk.

Well now investors know, and it seems they're not happy.