Reuters/ Allen Fredrickson
Bill Ackman
Ackman began the call by saying that they've had more participants than expected. He said the reason they're holding the call is for transparency.
He then went into a broad overview of the company and its management, flying through the slides.
"This is a complicated business. Any business that has grown quickly is complicated," he said.
He noted that the investor base is a sophisitcated one. It's a "who's who of kind of so-called smart money" he added.
He said shareholders need to understand the business.
Ackman and other Pershing Square portfolio managers and analysts will be taking questions.
We're covering the call live. Be sure to refresh this page for updates.
Since taking a position earlier this year, Pershing Square has likely lost more than $1.5 billion on paper on Valeant, the fund's largest stock holding.
Shares of the Canadian drug company have collapsed nearly 40% since last Wednesday after the California-based short-selling firm Citron Research published a report asking whether Valeant was operating an Enron-like fraud.
Citron's report focuses on the company's relationship with Philidor, a specialty pharmacy that distributes prescription drugs for Valeant. Valeant is the only supplier to Philidor, and it also has an option to buy the company. On Wall Street, no one had really heard of Philidor until earlier this month.
Citron has accused Valeant of using Philidor to create "phantom sales" of its products.
Valeant has categorically denied the allegations in the Citron report. The company hosted an all-hands call Monday morning to address the allegations.
Valeant drops Philidor
On Friday morning, Valeant said it was "severing all ties" with Philidor, which had represented 6.8% of Valeant's total revenue in the third quarter.
Valeant's CEO Michael Pearson said in a statement they have "lost confidence in Philidor's ability to continue to operate in a manner that is acceptable to Valeant and the patients and doctors we serve."
He continued: "We understand that patients, doctors and business partners have been disturbed by the reports of improper behavior at Philidor, just as we have been. We know the allegations have also led them to question Valeant and our integrity, and for that I take complete responsibility."
On Thursday afternoon, CVS and Express Scripts also terminated their relationships with Philidor.
What's at stake?
Ackman's Pershing Square Capital Management owns 21,473,933 shares of Valeant, including 2 million shares Ackman bought during last Wednesday's sell-off.
Pershing Square is Valeant's third-largest shareholder. The stock is Ackman's largest investment. The losses have dragged down his fund's performance.
Pershing Square Holdings, the fund's publicly traded vehicle, is down 15.9% this year through Tuesday, October 27.
Ackman first disclosed his position in Valeant on March 17, when the share price was $200 per share. At that share price, the position was worth $3.9 billion. With his added shares from last week, Ackman's position is worth $2.14 billion. That would represent a loss of around $1.76 billion.