Hiking drug prices so aggressively was 'a mistake' Valeant CEO tells lawmakers

Valeant Pharmaceutical's soon-to-be-former CEO, J. Michael Pearson, says he and the company were "too aggressive" in bumping up prices on some of its drug products.

Pearson's comments are included in advance notes of testimony that he is due to give Wednesday afternoon in Washington, D.C. before the U.S. Senate's special committee on aging.

Pearson is nearing his last day as CEO of Valeant. The company announced earlier this week that he will be replaced in early May by Joseph Papa, who recently stepped down as head of Irish drugmaker Perrigo.

A former stock market darling, Laval, Que.,-based Valeant is one of several drug companies under the microscope for the practice of jacking up prices.

"We made many decisions of which I am proud, such as launching new drugs, investing in U.S.-based R&D and manufacturing operations, and pioneering new ways to improve patients' access to medicines," Pearson says in the statement.

"But we have also made mistakes, including those that bring me here today. In particular, the company was too aggressive — and I, as its leader, was too aggressive — in pursuing price increases on certain drugs," he said.

"Let me state plainly that it was a mistake to pursue, and in hindsight I regret pursuing, transactions where a central
premise was a planned increase in the prices of the medicines," he added.

Pearson said the company decided to rapidly boost the prices on two heart drugs, Nitropress and Isuprel, immediately after acquiring them because they had learned that generic versions of the products were soon expected to hit the market.

"In retrospect, we relied too heavily on the industry practice of increasing the price of brand name drugs in the months before generic entry," Pearson said in his testimony.

Also due to testify Wednesday are William Ackman, a billionaire hedge fund manager who is one of Valeant's leading investors and a board member, and Howard Schiller, Valeant's former chief financial officer and a current board member.

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