Bausch Health Companies Inc. · TSX:BHC
Bausch Health Companies — Valeant Pharmaceuticals International — Corporate Update (October 2015)
90 slides from Bausch Health Companies's corporate update, Oct 26, 2015
Slide 1: Valeant Pharmaceuticals International, Inc. Investor Conference Call
Valeant Pharmaceuticals International, Inc. Investor Conference Call October 26, 2015
Slide 2: Forward-looking Statements
Forward-looking Statements Forward-looking Statements Certain statements made in this presentation may constitute forward-looking statements, including, but not limited to, statements regarding the expected future performance, including guidance with respect to revenue, Cash EPS, adjusted cash flow
Slide 3: In attendance today
In attendance today Robert Ingram, Lead Independent Director Board members Robert Hale, Board Member, Partner of ValueAct Capital Theo Melas-Kyriazi, Board Member, Member Audit and Risk Committee G. Mason Morfit, Board Member, President of ValueAct Capital Norma Provencio, Board Member, Ch
Slide 4: Opening Remarks
J. Michael Pearson Robert Ingram Opening Remarks
Slide 5: Agenda
Agenda ▪ Philidor 1. Specialty pharmacies 2. Valeant’s history with Philidor 3. Philidor’s network and operations 4. Accounting and disclosure for Philidor 5. Valeant diligence, oversight, and control as it relates to Philidor 6. R&O: The facts as we know them 7. Philidor summary and next steps ▪ Bu
Slide 6: 1. Specialty pharmacies – Dr. Ari Kellen
1. Specialty pharmacies – Dr. Ari Kellen 5
Slide 7: Our Dermatology Specialty Pharmacy Strategy
Our Dermatology Specialty Pharmacy Strategy ▪ We value our relationships with traditional wholesale and retail pharmacy channels, and continue to make our products available through those channels. We have an offering through specialty pharmacy for the smaller subset of physicians and patients who p
Slide 8: Key Elements of the Philidor Program
Key Elements of the Philidor Program ▪ For Commercially insured patients, Philidor dispenses Valeant medications before adjudication of the reimbursement may be finalized. Patients get their medicines more quickly and Valeant takes the risk for non- reimbursement ▪ Affordable cash pay options exist
Slide 9: Other Companies Focused on Dermatology Utilize Specialty Pharmacies
Other Companies Focused on Dermatology Utilize Specialty Pharmacies Example Specialty Pharmacies Company Example Product identified* Allergan Aczone, Tazorac Choice Compounding Pharmacy IRMAT Pharmacy Galderma (Nestle) Epiduo IRMAT Pharmacy PharmaDerm Kerydin RxCrossroads Pharmacy (Part of (Novartis
Slide 10: Examples of Valeant products offered through Philidor
Examples of Valeant products offered through Philidor* Commercially insured Product Name Strength Size 1st Rx Refill Cash pay Acanya 1.2%/2.5% 50 g $35 $40 $75 Atralin 0.05% 45 g $35 $40 $125 Clindagel 1% 75 ml $0 $40 $75 Jublia 10% 4 ml $0 $0/$40 (1) $75 8 ml $0 $0/$40 (1) $125 Locoid Lotion 0.10%
Slide 11: Channel economics
Channel economics In Q3 2015, Philidor represented 6.8% of total Valeant revenue In Q3 2015, Philidor represented ~7% of Valeant EBITA Prescriptions through Philidor are less profitable than traditional channels due to lower copay rates, lower cash pay rates and more cash pay scripts in Philid
Slide 12: Specialty Pharmacy - Q&A (1/6)
Specialty Pharmacy - Q&A (1/6) Question: What % of your YTD net revenues flow through specialty pharmacies? What % of YTD net revenues is through Philidor? Answer: ▪ Specialty pharmacies account for 7.2% of Valeant net revenue YTD ▪ Philidor accounts for 5.9% of Valeant net revenue YTD 11
Slide 13: Specialty Pharmacy - Q&A (2/6)
Specialty Pharmacy - Q&A (2/6) Question: What % of Jublia net revenues flowed through Philidor in 3Q 2015? Answer: ▪ 44% of Jublia revenue flowed through Philidor in Q3 2015 12
Slide 14: Specialty Pharmacy - Q&A (3/6)
Specialty Pharmacy - Q&A (3/6) Question: How are specialty pharmacies compensated? Answer: ▪ Like retail pharmacies, specialty pharmacies are paid by health insurers and patients, and often also receive fees for performing certain additional services on behalf of manufacturers such as refill reminde
Slide 15: Specialty Pharmacy - Q&A (4/6)
Specialty Pharmacy - Q&A (4/6) Question: How do specialty pharmacies interact with the PBMs? Answer: ▪ Specialty pharmacies, like retail pharmacies, contract with PBMs to be included in their network. The ability for PBMs to restrict members is dependent on state law ▪ A number of states have “Any W
Slide 16: Specialty Pharmacy - Q&A (5/6)
Specialty Pharmacy - Q&A (5/6) Question: How are specialty pharmacies regulated? Answer: ▪ Specialty pharmacies are licensed by state regulators and are subject to federal controlled substance regulations 15
Slide 17: Specialty Pharmacy - Q&A (6/6)
Specialty Pharmacy - Q&A (6/6) Question: Can a manufacturer own a specialty pharmacy? Answer: ▪ Yes ▪ For example Abbvie currently owns Pharmacy Solutions, which distributes Humira, Lupron Depot, Lupaneta Pack to patients(1) (1) Source: www.abbvie.com 16
Slide 18: 2. Valeant’s history with Philidor – Howard Schiller
2. Valeant’s history with Philidor – Howard Schiller 17
Slide 19: Philidor History – Pre Option
Philidor History – Pre Option ▪ Pilot program developed pre-acquisition by Philidor for Medicis – Original program covered Solodyn and Ziana in a limited number of states – Services agreement with Philidor signed January 2013 ▪ After seeing evidence of success in late 2013 the parties agreed to expa
Slide 20: Why an option to acquire Philidor? (1/2)
Why an option to acquire Philidor? (1/2) ▪ In fall of 2014, Philidor was at an inflection point with their business. Philidor had experienced significant growth and success with Valeant in dermatology, and was now looking to expand into more therapeutic offerings with additional partners ▪ While we
Slide 21: Why an option to acquire Philidor? (2/2)
Why an option to acquire Philidor? (2/2) ▪ Our primary interest was ensuring that Philidor remained focused on our business ▪ We considered the full spectrum from outright purchase to different exclusivity arrangements ▪ Ultimately determined the structured option acquisition with the oversight righ
Slide 22: Why this option purchase is different from typical Valeant transactions
Why this option purchase is different from typical Valeant transactions ▪ Typical practice in Valeant integrations – Existing Valeant manager with operational responsibility for the business starting Day 1 – Work to cut over all financial and IT systems ASAP post close – Employees are trained on Val
Slide 23: Philidor option terms
Philidor option terms ▪ Upfront: ~$100M ▪ Valeant has the right to exercise its option for up to 10 years to acquire Philidor for $0 ▪ Milestones: Up to $133M – $33M of milestones already paid ▪ Philidor is independent, with Valeant having contractual rights including: – Joint Steering Committee – R
Slide 24: Indemnification from Philidor (1/2)
Indemnification from Philidor (1/2) ▪ Valeant received representations, warranties, and covenants as to business practices/performance from Philidor – Representations that Philidor: ▫ Was not in violation of any applicable law ▫ Had all material permits required by law necessary for the conduct of i
Slide 25: Indemnification from Philidor (2/2)
Indemnification from Philidor (2/2) ▪ Under the option agreement, for breaches of fundamental representations and certain covenants (including compliance with applicable law), Philidor’s equity holders’ obligation to indemnify Valeant survives indefinitely and is capped at the amount of the up-front
Slide 26: Philidor History – Post Option
Philidor History – Post Option ▪ December 2014 - acquired option to acquire Philidor – Rationale to acquire option for Philidor was to keep Philidor focused on Valeant’s business and to ensure continued strong customer service – Gave Valeant a level of contractual influence to benefit our business,
Slide 27: Valeant’s Management Rights
Valeant’s Management Rights ▪ Unless and until Valeant exercises the option to acquire Philidor, Philidor remains independent and Valeant has no rights to remove CEO or management ▪ Valeant has the right (but not the obligation) to appoint or cause Philidor to hire: – Advisor to the CEO – Head Compl
Slide 28: Valeant’s history with Philidor – Q&A (1/4)
Valeant’s history with Philidor – Q&A (1/4) Question: Do Mike Pearson, other Valeant senior executives, or board members own a stake in Philidor? Answer: ▪ No, neither Valeant senior executives nor board members own a stake in Philidor 27
Slide 29: Valeant’s history with Philidor – Q&A (2/4)
Valeant’s history with Philidor – Q&A (2/4) Question: Has Valeant lent money to the owners of Philidor? Answer: No, Valeant has not lent any money to the owners of Philidor 28
Slide 30: Valeant’s history with Philidor – Q&A (3/4)
Valeant’s history with Philidor – Q&A (3/4) Question: What would be the rationale for a Valeant entity to file the UCC-1 liens on Philidor’s members’ equity? Answer: ▪ The UCC-1 liens have nothing to do with any loan ▪ They are in place to secure our rights to the equity we would acquire if we exerc
Slide 31: Valeant’s history with Philidor – Q&A (4/4)
Valeant’s history with Philidor – Q&A (4/4) Question: Who is KGA Fulfillment Services? Answer: ▪ KGA Fulfillment Services, a wholly-owned subsidiary of Valeant, filed the UCC-1 liens, and owns Valeant’s option to acquire Philidor 30
Slide 32: 3. Philidor’s network and operations – Howard Schiller
3. Philidor’s network and operations – Howard Schiller 31
Slide 33: Philidor at a Glance
Philidor at a Glance ▪ Pharmacy headquartered in Pennsylvania – CEO Andrew Davenport – Locations in Hatboro and Horsham, Pennsylvania and Phoenix, Arizona – Licensed to dispense in 46 states + DC – Presently Philidor’s network of pharmacies includes pharmacies located in California, Florida, New Jer
Slide 34: Evolution of the Philidor model
Evolution of the Philidor model Original strategy: Phase 2: Future: • Single hub in • Testing different • Further expand Pennsylvania expansion models: network via • Added state increased network partnering with licenses and by acquiring existing back-end interests in pharmacies on capacity over add
Slide 35: Philidor’s network and operations - Q&A (1/12)
Philidor’s network and operations - Q&A (1/12) Question: How does Philidor distribute drugs in states, like California, where they are not licensed? Does Philidor contract with sub-contractors? Answer: • We understand that Philidor holds non-resident licenses in 45 states, the District of Columbia a
Slide 36: Philidor’s network and operations - Q&A (2/12)
Philidor’s network and operations - Q&A (2/12) Question: Are competitor products, including generics, available through Philidor? Answer: ▪ Yes, but the bulk of Philidor’s volume is related to Valeant products 35
Slide 37: Philidor’s network and operations - Q&A (3/12)
Philidor’s network and operations - Q&A (3/12) Question: How do you compensate Philidor? Answer: ▪ We pay Philidor a per prescription service fee as consideration for the various services provided by Philidor in the administration of our alternate fulfillment program. However this fee is eliminated
Slide 38: Philidor’s network and operations - Q&A (4/12)
Philidor’s network and operations - Q&A (4/12) Question: Is the Isolani structure intended to avoid continued review issues in California? Answer: ▪ Valeant has consulted with experienced and knowledgeable regulatory counsel. We believe that the Isolani structure meets California’s legal requirement
Slide 39: Philidor’s network and operations - Q&A (5/12)
Philidor’s network and operations - Q&A (5/12) Question: Did Valeant have an ownership interest at the time that Philidor applied for its non-resident license in California? Answer: ▪ No, Valeant has never had an ownership interest in Philidor. Valeant acquired its option after Philidor had submitte
Slide 40: Philidor’s network and operations - Q&A (6/12)
Philidor’s network and operations - Q&A (6/12) Question: Does Philidor auto-refill RXs? If so, when? What is the full process? Answer: ▪ We understand that Philidor patients are contacted by a customer service representative between 24 and 28 days after Philidor dispenses the initial fill on a parti
Slide 41: Philidor’s network and operations - Q&A (7/12)
Philidor’s network and operations - Q&A (7/12) Question: Do other pharmacies have refill programs? Answer: ▪ Yes, other pharmacies, including national chains such as Walgreens have auto-refill programs 40
Slide 42: Philidor’s network and operations - Q&A (8/12)
Philidor’s network and operations - Q&A (8/12) Question: Does Philidor have contracts with PBMs? Answer: ▪ Yes, Philidor, like other pharmacies, has contracts with PBMs to be included in their networks 41
Slide 43: Philidor’s network and operations - Q&A (9/12)
Philidor’s network and operations - Q&A (9/12) Question: Have PBMs and Managed Care Organizations audited Philidor? Answer: ▪ We understand that Philidor and its network pharmacies have complied with several hundred desk audits from almost the entire universe of payors, and have participated in more
Slide 44: Philidor’s network and operations - Q&A (10/12)
Philidor’s network and operations - Q&A (10/12) Question: Why have a number of employees of Valeant recently become employees of Philidor? Answer: ▪ Philidor decided to hire a field force to assist in providing customer services and hired a number of former Valeant employees 43
Slide 45: Philidor’s network and operations - Q&A (11/12)
Philidor’s network and operations - Q&A (11/12) Question: Do other specialty pharmacies have field forces? Answer: ▪ Yes, pharmacies other than Philidor have field forces to promote their services 44
Slide 46: Philidor’s network and operations - Q&A (12/12)
Philidor’s network and operations - Q&A (12/12) Question: Why was Philidor’s California pharmacy application rejected? Answer: • This is an issue that the ad hoc committee of the board plans to review 45
Slide 47: 4. Accounting and Disclosure for Philidor
4. Accounting and Disclosure for Philidor – Robert Rosiello Tanya Carro 46
Slide 48: Revenue Recognition Policies for Philidor
Revenue Recognition Policies for Philidor ▪ Valeant consolidates financials with Philidor and the Philidor network, ensuring that revenue recognition and financial statement presentation is appropriate ▪ Third party revenue is not recognized when products are shipped to Philidor and its network (the
Slide 49: Accounting for Philidor
Accounting for Philidor Before Purchase Option Agreement (1) After Purchase Option Agreement (1) All sales to Philidor accounted for as Inventory held at Philidor remains on Valeant does with any third party Valeant’s consolidated balance sheet Sales recognized upon transfer of Revenues only
Slide 50: Product and Financial Flows for Philidor and the Philidor Network (1/2)
Product and Financial Flows for Philidor and the Philidor Network (1/2) 1. Philidor for itself or affiliates sends an order to Valeant 2. Valeant ships to Philidor for itself or affiliates in response to that order 3. Valeant records these shipments as intercompany sales, which are eliminated in con
Slide 51: Product and Financial Flows for Philidor and the Philidor Network (2/2)
Product and Financial Flows for Philidor and the Philidor Network (2/2) 6. Difference between WAC inventory value and amount of collections from patients/payors is recorded as an intercompany receivable from Valeant, which offsets the intercompany payable 7. Amounts collected from patients and payor
Slide 52: Policy on Consolidating VIEs
Policy on Consolidating VIEs ▪ Valeant evaluates the accounting treatment of Variable Interest Entities (VIEs) in accordance with ASC 810 ▪ Philidor was considered a VIE prior to the Purchase Option Agreement, but since Valeant was not determined to be the primary beneficiary, consolidation was not
Slide 53: Financial control approach to Philidor
Financial control approach to Philidor ▪ Philidor is included in Valeant’s SOX 404 Internal Control Testing and Internal Audit program for 2015 – This includes both Business Processes and IT General Controls testing – We co-source with a Big 4 Firm that conducts the testing for these programs ▪ Vale
Slide 54: Materiality of Philidor for Disclosure Purposes
Materiality of Philidor for Disclosure Purposes ▪ Philidor is not considered material to Valeant’s business for reporting purposes – At the time of the Purchase Option Agreement in December, 2014, Philidor YTD net sales were $111 million – The GAAP requirement for disclosing sales to large customers
Slide 55: Disclosures of Philidor, Past and Future
Disclosures of Philidor, Past and Future ▪ As Philidor was not considered material to Valeant for reporting purposes, it was not reported prior to October 2015 ▪ Consolidation of VIEs was disclosed in Valeant’s 2014 10-K in two places – Footnote 2 Significant Accounting Policies – Footnote 3 Busines
Slide 56: Accounting and Disclosure for Philidor - Q&A (1/4)
Accounting and Disclosure for Philidor - Q&A (1/4) Question: Did you use an outside law firm to design the Philidor arrangement? Answer: ▪ Hogan Lovells advised us on structuring our distribution and services arrangement with Philidor along with supporting our due diligence on the company 55
Slide 57: Accounting and Disclosure for Philidor - Q&A (2/4)
Accounting and Disclosure for Philidor - Q&A (2/4) Question: How does Valeant account for other specialty pharmacies revenue? Answer: Pharmacies in the Philidor network, including R&O, are consolidated by Valeant and net revenue is booked when the product is sold to a patient Specialty pharmacie
Slide 58: Accounting and Disclosure for Philidor - Q&A (3/4)
Accounting and Disclosure for Philidor - Q&A (3/4) Question: Are there any other accounting standards that could have been applied to Philidor with regard to revenues and/or inventories? Answer: ▪ Based on the rights acquired by Valeant with the option purchase, and applying the criteria described i
Slide 59: Accounting and Disclosure for Philidor - Q&A (4/4)
Accounting and Disclosure for Philidor - Q&A (4/4) Question: Are there any other consolidated specialty pharmacies or VIEs besides Philidor? Answer: Valeant consolidates two VIE’s in addition to the Philidor network: (1) PT Kukah Usaha Maju (PT KUM), the 15% minority interest owner of a company we
Slide 60: 5. Valeant diligence, oversight and control as it relates to Philidor
5. Valeant diligence, oversight and control as it relates to Philidor – Seana Carson 59
Slide 61: Valeant diligence prior to entering into the option agreement
Valeant diligence prior to entering into the option agreement ▪ All agreements since the outset have been reviewed or drafted by legal counsel ▪ Legal, compliance, regulatory, and business diligence was conducted in connection with the Purchase Option and Distribution Services Agreement with the ass
Slide 62: Valeant’s rights under the option agreement
Valeant’s rights under the option agreement ▪ Philidor operates independently ▪ Valeant has rights to access Philidor’s books, records and facilities ▪ Philidor must give Valeant prompt notice of any events that result in a material breach of its covenants or could reasonably expect to result in a b
Slide 63: Valeant’s oversight since entering the option agreement
Valeant’s oversight since entering the option agreement ▪ We maintain regular contact between business and functional leads ▪ Per our right in the option agreement, following acquisition of the option, Philidor, with input from Valeant, hired both an in-house lawyer and a head of compliance, with re
Slide 64: Diligence, oversight and control - Q&A (1/4)
Valeant diligence, oversight and control as it relates to Philidor - Q&A (1/4) Question: Who does Philidor report to? Answer: ▪ Philidor is independent and therefore does not report to anyone at Valeant. There is a Joint Steering Committee and operational leads that regularly interact 63
Slide 65: Diligence, oversight and control - Q&A (2/4)
Valeant diligence, oversight and control as it relates to Philidor - Q&A (2/4) Question: Does Valeant provide financial benefits to doctors to route prescriptions to Philidor? Answer: ▪ No 64
Slide 66: Diligence, oversight and control - Q&A (3/4)
Valeant diligence, oversight and control as it relates to Philidor - Q&A (3/4) Question: What safeguards are in place as protection so that Philidor does not apply Valeant’s patient assistance program to Medicare or other federally funded programs? Answer: Valeant’s patient assistance program limi
Slide 67: Diligence, oversight and control - Q&A (4/4)
Valeant diligence, oversight and control as it relates to Philidor - Q&A (4/4) Question: Can you comment on today’s Wall Street Journal article? Answer: This is an issue that the ad hoc committee of the board plans to review 66
Slide 68: 6. R&O: The facts as we know them
6. R&O: The facts as we know them – Robert Chai-Onn 67
Slide 69: R&O’s Relationship with Philidor
R&O’s Relationship with Philidor ▪ Philidor has an option to acquire Isolani, LLC (Isolani) (not yet exercised) ▪ Isolani holds a 10% equity stake and the right to acquire the remaining 90% of equity of R&O (not yet acquired); total transaction value of $350,000 ▪ R&O Pharmacy, LLC (R&O) is a licens
Slide 70: Dispute With R&O (1/2)
Dispute With R&O (1/2) ▪ This is a collection action ▪ History: – Isolani on behalf of R&O, submitted product orders through Philidor to VPNA – VPNA made approximately 75 shipments to R&O between January and August 2015 – From March 2015-July 2015, R&O made payments of $18.4 million directly to VPNA
Slide 71: Dispute With R&O (2/2)
Dispute With R&O (2/2) ▪ History (continued): – To ensure payment, VPNA sent a letter to R&O on September 4, 2015 demanding immediate payment. The amount referenced in the letter represents the intercompany payable balance of $69M – On September 8, 2015 R&O’s counsel refused payment – On September 8
Slide 72: Revenue Recognition Policies in Effect for R&O
Revenue Recognition Policies in Effect for R&O ▪ Valeant consolidates the R&O financials, ensuring that revenue recognition is appropriate ▪ Revenue is not recognized when products are shipped to R&O ▪ Instead, Valeant recognizes revenue only when products are dispensed to patients and records this
Slide 73: R&O: The facts as we know them - Q&A (1/11)
R&O: The facts as we know them - Q&A (1/11) Question: What is the business rationale for the relationships between Philidor, Isolani and R&O? Answer: ▪ We understand that R&O is a pharmacy in California with non-resident licenses in 34 other states ▪ The relationship, through Isolani, provided Phili
Slide 74: R&O: The facts as we know them - Q&A (2/11)
R&O: The facts as we know them - Q&A (2/11) Question: Why did Valeant send a collection letter to R&O instead of Philidor? Answer: ▪ Because R&O failed to deposit checks into the appropriate account for payment to Valeant for the products Valeant had already supplied and R&O had dispensed 73
Slide 75: R&O: The facts as we know them - Q&A (3/11)
R&O: The facts as we know them - Q&A (3/11) Question: Why did Valeant not provide R&O with proof of an invoice, when R&O lawyers requested it? Answer: ▪ At the time R&O made the request R&O had already received all of the Valeant invoices 74
Slide 76: R&O: The facts as we know them - Q&A (4/11)
R&O: The facts as we know them - Q&A (4/11) Question: Why did Valeant’s collection letter demand a payment of $69 million, when the net revenues expected were only $25 million? Answer: ▪ The $69 million is the intercompany payable balance from R&O’s (valued at WAC) ▪ $25 million includes $19.3 milli
Slide 77: R&O: The facts as we know them - Q&A (5/11)
R&O: The facts as we know them - Q&A (5/11) Question: Why did Philidor’s suit with R&O seek $15 million if Valeant expects net revenues of $25 million? Answer: ▪ Philidor’s suit references the total accounts receivable of $19.3 million, and also references $15 million as the amount that was due to b
Slide 78: R&O: The facts as we know them - Q&A (6/11)
R&O: The facts as we know them - Q&A (6/11) Question: What financial and other support does Valeant provide to R&O? Answer: ▪ Valeant provides no financial or other support to R&O 77
Slide 79: R&O: The facts as we know them - Q&A (7/11)
R&O: The facts as we know them - Q&A (7/11) Question: Why did you request payment from R&O when they have said they never heard of Valeant? Answer: ▪ From January to July 2015 Valeant sent e-mail invoices to R&O ~75 times and R&O consistently received and paid these invoices ▪ This is a recent colle
Slide 80: R&O: The facts as we know them - Q&A (8/11)
R&O: The facts as we know them - Q&A (8/11) Question: Did Philidor’s commit wrongdoing by shipping products to California residents without a California license? Answer: ▪ We understand that: – Philidor did not dispense products to patients in California – Philidor only dispenses products to patient
Slide 81: R&O: The facts as we know them - Q&A (9/11)
R&O: The facts as we know them - Q&A (9/11) Question: Did Philidor misuse R&O’s NCPDP number? Answer: ▪ We understand that Philidor denies this allegation 80
Slide 82: R&O: The facts as we know them - Q&A (10/11)
R&O: The facts as we know them - Q&A (10/11) Question: There are two websites:http://r-opharmacy.com/ and http://randopharmacy.com/, are you sure you are suing the right person? Answer: ▪ R&O has filed suit against Valeant, Valeant intends to file a counterclaim 81
Slide 83: R&O: The facts as we know them - Q&A (11/11)
R&O: The facts as we know them - Q&A (11/11) Question: Why does R&O and Philidor have the same phone number? Answer: ▪ Philidor provides back end services for R&O 82
Slide 84: 7. Philidor summary and next steps – J. Michael Pearson
7. Philidor summary and next steps – J. Michael Pearson 83
Slide 85: Philidor Summary and Next Steps
Philidor Summary and Next Steps ▪ Strategy working with specialty pharmacies is sound ▪ There have been no issues with regards to the accounting or revenue recognition of the business ▪ To date, we have found no evidence of illegal activity at Philidor ▪ We have created an ad-hoc committee of indepe
Slide 86: Business updates – J. Michael Pearson
Business updates – J. Michael Pearson 85
Slide 87: Q3 2015 Highlights
Q3 2015 Highlights ▪ Exceeded top line and bottom line Q3 guidance; 5th consecutive quarter of >10% organic growth – Includes negative FX impact of $172M revenues and $0.13 Cash EPS – Continued outperformance of U.S. businesses, particularly dermatology and contact lens – Strong organic growth in Ch
Slide 88: Valeant’s Strategy Vis-à-vis R&D and M&A
Valeant’s Strategy Vis-à-vis R&D and M&A R&D M&A and Capital Allocation ▪ We remain focused on high output, low ▪ 8 year track record of effectively fixed cost results deploying capital via tuck-ins and large deals ▪ Every project is evaluated individually ▪ We will continue to pursue tuck-in ▪ Expe
Slide 89: Expectation For Business Performance Going Forward
Expectation For Business Performance Going Forward ▪ We reaffirm Q4 guidance and 2016 EBITDA of $7.5B except for one time expenses associated with recent events ▪ Q4 off to a strong start ▪ We are not anticipating any impact, but it is hard to predict how recent events will impact the business in th
Slide 90: Valeant Pharmaceuticals International, Inc.
Valeant Pharmaceuticals International, Inc. Investor Conference Call October 26, 2015
Valeant Pharmaceuticals International — Corporate Update (October 2015) on 6ix