REUTERS/Christinne Muschi
J. Michael Pearson, Chairman of the board and Chief Executive Officer of Valeant Pharmaceuticals International Inc., speaks during their annual general meeting in Laval, Quebec May 20, 2014.
This comes after a whole slew of bad news. The company delayed its annual report last week and its fourth quarter earnings on Sunday night. Then on Monday Moody's announced that it was putting Valeant's debt under review for a downgrade.
"Valeant confirms that it has several ongoing investigations, including investigations by the US Attorney's Offices for Massachusetts and the Southern District of New York,the SEC, and Congress," said Laurie Little, a Valeant spokeswoman.
This is a new SEC investigation, separate from an SEC investigation into Valeant's acquisition of drugmaker Salix.
Since October
Valeant stock has been a Wall Street scalp-taker since October, when accusations of malfeasance from a short seller and government scrutiny over its drug pricing practices sent the stock crashing down.
Through all the drama, Valeant had disclose its secret relationship with a special distributor, Philidor pharmacy, that it had the option to purchase. Valeant shut Philidor down because of potentially shady practices, and has had to reinvent itself.
In December CEO Michael Pearson announced tha the company's strategy would change. It would no longer use acquisitions to grow, buying drugs and then hiking up their prices. Instead, he said, it would depend on volume. Valeant then entered into a new agreement with Walgreens.
But Wall Street doesn't have that much faith in the new Valeant, for reasons that have as much to do with transparency a turning a profit.
It will be waiting for answers on this new SEC investigation, and it won't be waiting patiently.