VRX - Valeant Pharmaceuticals International Inc.

[Guest Schwab711]

I wrote it out so others could adjust the $/prescription. I even used 5 days/week and 12,000 prescriptions/day to be conservative.

 

If you read the letter Valeant sent to McCaskill, they disclosed average sales price per perscription in 3Q 2014 at $280.82 and in 3Q 2015 at $316.86.

 

So your $480 is way, way off.

 

http://www.mccaskill.senate.gov/imo/media/doc/Pearson%20Letter%20to%20Sen%20McCaskill%202015-10-14.pdf

 

5 * 52 * 12,000 * $316.86 = $988.6m

5 * 52 * 15,000 * $316.86 = $1.235b

 

So revenue is between $1b and $1.25b in 2015 ($886m - $1.1b in 2014), according to them. Greater than 10% in every period.

 

This link also seemed relevant:

https://www.youtube.com/watch?v=Bc3gXnhSy4E&feature=youtu.be&t=15s

 

First off, the 12,000-15,000 per day is towards the end of 2015.  They were doing around 6,000 a day in April of this year and expect to ramp up to 12,000-15,000 by the end of 2015.

 

So not only is the average price way too high, but you're also annualizing the highest volume of the end of the year.

 

Watch the interview: https://www.facebook.com/senatorgreenleaf/posts/807822615960322

 

I watched the interview. Then you do some math and try to project. Use 6,000/day for the year and you'll see $400m-$500m in revenue.

 

Watch the Happy Gillmore link.

[scorpioncapital]

I never liked Valeant´s business model to begin with, so there is more reason to dislike it now. Pharma companies are Cash horders, but VRX is opposite, it is a debt horder ! This story sound more and more implausible, there is no way they can earn 45% ROI in this situation. Aetna, Cigna, BCBS, all will be cutting reimbusement like crazy, physicians in our community don´t like its products, so where is that Competitive Advantage, it is not there and it is not coming back. What VRX need to worry about is the debt load ! $30B is no pocket change. I would have felt very comfortable if they had $30B is cash, I could have cared less. As Munger said ¨one can do very well by simply avoiding stupidty¨.

 

Look what happened to Taro in 2007 - http://www.globes.co.il/en/article-1000220991

 

Almost went bankrupt due to lower sales - and they were debt free almost! Today, the company has 1 billion cash at all times, probably they were scarred from that event. Investors are clamoring for them to release the funds or take debt or do something.

 

Anytime you combine high debt and there's a hiccup you run the risk of big problem. It may never happen, or it might happen quickly, you just don't know.

 

 

[Picasso]

I watched the interview. Then you do some math and try to project. Use 6,000/day for the year and you'll see $400m-$500m in revenue.

 

Watch the Happy Gillmore link.

 

I would say reality is much closer to $300/drug and 9,000 of daily volume.  That's about $700 million of inventory being routed through Philidor for 2015.  That's very much in line with the 10-20% that has been disclosed by Valeant.  In terms of disclosure, it was a lot less material in 2014 versus 2015 and then 2016.  It's not like they've been around with significant volume in 2011 and we've never had disclosure.  In fact it wasn't in existence two years ago and it's taken time to ramp up.

 

Have we had any evidence so far that Philidor has only Valeant as a customer?  They refer to customers in the plural sense, so wondering if there's any other customers besides Valeant in there.

[KCLarkin]

I have no problem with citron's report but I do have a problem with its timing.

 

I'm done on this topic but seriously. How can you not have a problem with his report. THERE IS NOTHING THERE. Just spurious connections to Enron. Read it again. Then compare to SIRF or Bronte Capital or Propublica or Evercore. These guys have at least done the work and are willing to admit what they don't know.

 

Yet, this clown gets the airtime.

 

Regardless of what happens to Valeant, I have deep concerns about the rationality of any investor or media person who can take the Citron report seriously.

[cogitator8]

Very true ! Lot of smart people get into trouble due to debt, there are very few people like John Malone, who can use debt to their best advantage.

[Picasso]

Very true ! Lot of smart people get into trouble due to debt, there are very few people like John Malone, who can use debt to their best advantage.

 

I fail to see what your points are.  On a market cap of $40 billion, proforma free cash flow after interest payments is $4 billion a year.  They do not have any significant maturities for a few years from now and even if their cost of capital is near 9% for 6 year debt (where it traded yesterday on the credit default swaps, which I should mention that we have no idea if those are being manipulated to increase the efficiency of this bear raid given very low trading volume in the actual bonds) you couldn't see a situation where free cash flow would be less than $3 billion a year.  That's still a 7.5% return on the current equity price assuming nothing great ever happens again.

 

So what exactly are you trying to point out?  That there's a lot of debt that can't be serviced and nothing is left for shareholders?  What leads you to that conclusion other than this isn't Malone or Buffett?

[feynmanresearch]

Very true ! Lot of smart people get into trouble due to debt, there are very few people like John Malone, who can use debt to their best advantage.

 

Agreed. I think it's funny how the author of the Outsiders said that Mike Pearson could be an outsider CEO-I don't see how

[doughishere]

I never liked Valeant´s business model to begin with, so there is more reason to dislike it now. Pharma companies are Cash horders, but VRX is opposite, it is a debt horder ! This story sound more and more implausible, there is no way they can earn 45% ROI in this situation. Aetna, Cigna, BCBS, all will be cutting reimbusement like crazy, physicians in our community don´t like its products, so where is that Competitive Advantage, it is not there and it is not coming back. What VRX need to worry about is the debt load ! $30B is no pocket change. I would have felt very comfortable if they had $30B is cash, I could have cared less. As Munger said ¨one can do very well by simply avoiding stupidty¨.

 

Look what happened to Taro in 2007 - http://www.globes.co.il/en/article-1000220991

 

Almost went bankrupt due to lower sales - and they were debt free almost! Today, the company has 1 billion cash at all times, probably they were scarred from that event. Investors are clamoring for them to release the funds or take debt or do something.

 

Anytime you combine high debt and there's a hiccup you run the risk of big problem. It may never happen, or it might happen quickly, you just don't know.

 

 

 

Pharmaceuticals seems to me to be a shitty business to be into...High in Social Value. Low in actually business value to shareholders.

 

 

1) High R&D Costs. They are in the business of Science. Science is all about making mistakes. You make a drug that kills people, you are paying for it. Mistake. You go the wrong direction in trying to cure something, you are paying for it. Mistake. You take the time to research a disease and develop chemical formulas to treat that disease, you are paying for it, to advance scientific knowledge of the human body. Innovation just seems expensive.

 

2) High Social pressures. People "need" what you create. Legislation will always be trying to make that thing cheaper.....Look at the Dude who just raise his drug prices. People hate him. And now some other company said they are going to under cut him. You are paying for it.

 

3) It seems similar to a technology company.  Someone can always do it better or at least finding ways to to it better. Think Uber taking out taxi cabs in major cities. The cab company's had the medallions (ie. patent protections). Uber under cut them...Once that patent protection runs out...your paying for it. Congrats you did all the hard work...now someone else who didnt do the hard work gets to use your hard work.  So you had better hope you can make enough before that protection runs out.

 

 

Id much rather just crank out widgets knowing that if input cost rose i could just send those to the customer. Think, coke. People drink that shit weather it cost $1 or $1.25. No one complains Coke costs too much.

 

 

 

 

[LongHaul]

This is another Propublica article.  You can read both lawsuits and evidence and decide for yourself who is more credible. Philidor or Reitz.

 

http://www.propublica.org/article/further-allegations-of-misconduct-plague-valeants-pharmacies-in-california

 

Edit:  I have no position in VRX and never did. 

[feynmanresearch]

I never liked Valeant´s business model to begin with, so there is more reason to dislike it now. Pharma companies are Cash horders, but VRX is opposite, it is a debt horder ! This story sound more and more implausible, there is no way they can earn 45% ROI in this situation. Aetna, Cigna, BCBS, all will be cutting reimbusement like crazy, physicians in our community don´t like its products, so where is that Competitive Advantage, it is not there and it is not coming back. What VRX need to worry about is the debt load ! $30B is no pocket change. I would have felt very comfortable if they had $30B is cash, I could have cared less. As Munger said ¨one can do very well by simply avoiding stupidty¨.

 

Look what happened to Taro in 2007 - http://www.globes.co.il/en/article-1000220991

 

Almost went bankrupt due to lower sales - and they were debt free almost! Today, the company has 1 billion cash at all times, probably they were scarred from that event. Investors are clamoring for them to release the funds or take debt or do something.

 

Anytime you combine high debt and there's a hiccup you run the risk of big problem. It may never happen, or it might happen quickly, you just don't know.

 

 

 

Pharmaceuticals seems to me to be a shitty business to be into...High in Social Value. Low in actually business value to shareholders.

 

 

1) High R&D Costs. They are in the business of Science. Science is all about making mistakes. You make a drug that kills people, you are paying for it. Mistake. You go the wrong direction in trying to cure something, you are paying for it. Mistake. You take the time to research a disease and develop chemical formulas to treat that disease, you are paying for it, to advance scientific knowledge of the human body. Innovation just seems expensive.

 

2) High Social pressures. People "need" what you create. Legislation will always be trying to make that thing cheaper.....Look at the Dude who just raise his drug prices. People hate him. And now some other company said they are going to under cut him. You are paying for it.

 

3) It seems similar to a technology company.  Someone can always do it better or at least finding ways to to it better. Think Uber taking out taxi cabs in major cities. The cab company's had the medallions (ie. patent protections). Uber under cut them...Once that patent protection runs out...your paying for it. Congrats you did all the hard work...now someone else who didnt do the hard work gets to use your hard work.  So you had better hope you can make enough before that protection runs out.

 

 

Id much rather just crank out widgets knowing that if input cost rose i could just send those to the customer. Think, coke. People drink that shit weather it cost $1 or $1.25. No one complains Coke costs too much.

That dude that tried to raise the price of the drug from $1 to $750 was behaving unethically to an extreme degree. You can't raise the price that significantly for a drug that's been around for 6 decades and doesn't cost anywhere near $750 and expect to get away with it

[valueyoda]

Valeant is most definitely an outsider company. It takes an off-beaten path in the pharma industry, and picks up assets cheaply, Valeant will change its focus from debt-fuelled acquisitions to smart internal R&D investments, debt repayments and share buybacks. Somehow Valeant reminds me of Ocwen and Altisource. Once a strategy is considered to be too clever and too aggressive, regulators and short sellers will come after you, despite the fact that it is unwarranted.

 

Even if Citron's report was true, the total impact on FCF wouldn't warrant the market value loss this week. I think that Evercore did an excellent job in reporting on this issue, and I am hopeful that Pearson will refute these claims effectively. Ackman was right about the fact that this company should improve on its PR and communication skills.

[ScottHall]

I never liked Valeant´s business model to begin with, so there is more reason to dislike it now. Pharma companies are Cash horders, but VRX is opposite, it is a debt horder ! This story sound more and more implausible, there is no way they can earn 45% ROI in this situation. Aetna, Cigna, BCBS, all will be cutting reimbusement like crazy, physicians in our community don´t like its products, so where is that Competitive Advantage, it is not there and it is not coming back. What VRX need to worry about is the debt load ! $30B is no pocket change. I would have felt very comfortable if they had $30B is cash, I could have cared less. As Munger said ¨one can do very well by simply avoiding stupidty¨.

 

Look what happened to Taro in 2007 - http://www.globes.co.il/en/article-1000220991

 

Almost went bankrupt due to lower sales - and they were debt free almost! Today, the company has 1 billion cash at all times, probably they were scarred from that event. Investors are clamoring for them to release the funds or take debt or do something.

 

Anytime you combine high debt and there's a hiccup you run the risk of big problem. It may never happen, or it might happen quickly, you just don't know.

 

 

 

Pharmaceuticals seems to me to be a shitty business to be into...High in Social Value. Low in actually business value to shareholders.

 

 

1) High R&D Costs. They are in the business of Science. Science is all about making mistakes. You make a drug that kills people, you are paying for it. Mistake. You go the wrong direction in trying to cure something, you are paying for it. Mistake. You take the time to research a disease and develop chemical formulas to treat that disease, you are paying for it, to advance scientific knowledge of the human body. Innovation just seems expensive.

 

2) High Social pressures. People "need" what you create. Legislation will always be trying to make that thing cheaper.....Look at the Dude who just raise his drug prices. People hate him. And now some other company said they are going to under cut him. You are paying for it.

 

3) It seems similar to a technology company.  Someone can always do it better or at least finding ways to to it better. Think Uber taking out taxi cabs in major cities. The cab company's had the medallions (ie. patent protections). Uber under cut them...Once that patent protection runs out...your paying for it. Congrats you did all the hard work...now someone else who didnt do the hard work gets to use your hard work.  So you had better hope you can make enough before that protection runs out.

 

 

Id much rather just crank out widgets knowing that if input cost rose i could just send those to the customer. Think, coke. People drink that shit weather it cost $1 or $1.25. No one complains Coke costs too much.

 

[LongHaul]

Also,

 

I have been caught in a few frauds before.  A couple companies were cooking the books.  Another one was a Chinese company that showed super high EBIT margins and then they bribed the bank managers to fake the cash.  If a company can fake the cash they can just make up the books and it is a hard thing to do.  I was naive and lacked skills and expertise and knowledge.  Every time it happened I tried to learn from my mistakes.  Painful lessons but that is sometimes the only way I could learn.  The good thing though is that I have more experience and 1.  Don't invest what I don't understand and 2.  Really try to look at disconfirming facts very carefully with my own eyes.  In addition I have some ability to do forensic accounting.

 

I think there is an element of people being long not having the hard experience, ignoring it and not connecting the dots on VRX.

 

I think there were certain cases of disgusting bear raids - Overstock comes to mind.  Putting out false information smells illegal to me.

 

I don't think that is the case here at all.  The KGA Fullfillment Philidor connection, the R&O information and the Philidor connected pharmacies are cases in point.  VRX certainly didn't disclose any of this until they were forced to.

 

My purpose here is just to warn people about potential red flags and serious issues as I see them.  That may have helped me if I had been warned in the past.

 

     

 

 

[cmlber]

I never liked Valeant´s business model to begin with, so there is more reason to dislike it now. Pharma companies are Cash horders, but VRX is opposite, it is a debt horder ! This story sound more and more implausible, there is no way they can earn 45% ROI in this situation. Aetna, Cigna, BCBS, all will be cutting reimbusement like crazy, physicians in our community don´t like its products, so where is that Competitive Advantage, it is not there and it is not coming back. What VRX need to worry about is the debt load ! $30B is no pocket change. I would have felt very comfortable if they had $30B is cash, I could have cared less. As Munger said ¨one can do very well by simply avoiding stupidty¨.

 

Look what happened to Taro in 2007 - http://www.globes.co.il/en/article-1000220991

 

Almost went bankrupt due to lower sales - and they were debt free almost! Today, the company has 1 billion cash at all times, probably they were scarred from that event. Investors are clamoring for them to release the funds or take debt or do something.

 

Anytime you combine high debt and there's a hiccup you run the risk of big problem. It may never happen, or it might happen quickly, you just don't know.

 

 

 

Pharmaceuticals seems to me to be a shitty business to be into...High in Social Value. Low in actually business value to shareholders.

 

 

1) High R&D Costs. They are in the business of Science. Science is all about making mistakes. You make a drug that kills people, you are paying for it. Mistake. You go the wrong direction in trying to cure something, you are paying for it. Mistake. You take the time to research a disease and develop chemical formulas to treat that disease, you are paying for it, to advance scientific knowledge of the human body. Innovation just seems expensive.

 

2) High Social pressures. People "need" what you create. Legislation will always be trying to make that thing cheaper.....Look at the Dude who just raise his drug prices. People hate him. And now some other company said they are going to under cut him. You are paying for it.

 

3) It seems similar to a technology company.  Someone can always do it better or at least finding ways to to it better. Think Uber taking out taxi cabs in major cities. The cab company's had the medallions (ie. patent protections). Uber under cut them...Once that patent protection runs out...your paying for it. Congrats you did all the hard work...now someone else who didnt do the hard work gets to use your hard work.  So you had better hope you can make enough before that protection runs out.

 

 

Id much rather just crank out widgets knowing that if input cost rose i could just send those to the customer. Think, coke. People drink that shit weather it cost $1 or $1.25. No one complains Coke costs too much.

 

Pharmaceutical companies on average have some of the highest returns on equity of any industry, I think third to soft drinks and software at something north of 30%.  Yes, as an investor, it is difficult to figure out.  But as an industry, all the things you mentioned clearly don't make there way into the numbers.

[doughishere]

Pharmaceutical companies on average have some of the highest returns on equity of any industry, I think third to soft drinks and software at something north of 30%.  Yes, as an investor, it is difficult to figure out.  But as an industry, all the things you mentioned clearly don't make there way into the numbers.

 

 

Yeah, I gatta think about it a little more. Ackman sure talks it up like its Berkshire Hathaway. I bet there are some "good trades" in pharma if you know what you are doing.

 

Ackman seems to be in the "fix em up" business lately. Is that what this is? Buy a drug patent, cut costs trim the fat, re-release the company back into the wild. Thats fine, good for Ackmans shareholders.

 

I gatta think about this one a bit. To bad no one asks him these hard questions in interviews.

[original mungerville]

Also,

 

I have been caught in a few frauds before.  A couple companies were cooking the books.  Another one was a Chinese company that showed super high EBIT margins and then they bribed the bank managers to fake the cash.  If a company can fake the cash they can just make up the books and it is a hard thing to do.  I was naive and lacked skills and expertise and knowledge.  Every time it happened I tried to learn from my mistakes.  Painful lessons but that is sometimes the only way I could learn.  The good thing though is that I have more experience and 1.  Don't invest what I don't understand and 2.  Really try to look at disconfirming facts very carefully with my own eyes.  In addition I have some ability to do forensic accounting.

 

I think there is an element of people being long not having the hard experience, ignoring it and not connecting the dots on VRX.

 

I think there were certain cases of disgusting bear raids - Overstock comes to mind.  Putting out false information smells illegal to me.

 

I don't think that is the case here at all.  The KGA Fullfillment Philidor connection, the R&O information and the Philidor connected pharmacies are cases in point.  VRX certainly didn't disclose any of this until they were forced to.

 

My purpose here is just to warn people about potential red flags and serious issues as I see them.  That may have helped me if I had been warned in the past.

 

 

 

I'll warn you. The same people that were involved in the "disgusting bear raid" that was Overstock were involved with Fairfax Financial, and some of those people are involved here including John Hempton, Roddy Boyd, and possibly much larger hedge funds. If you want a history lesson, I can give it to you. By the way, my view is AZ Value is probably John Hempton, and that you may also be affiliated.

 

Just my view, everyone can have a view. Right? Just like Andrew Left at Citron, however unsubstantiated.

 

 

[muscleman]

Also,

 

I have been caught in a few frauds before.  A couple companies were cooking the books.  Another one was a Chinese company that showed super high EBIT margins and then they bribed the bank managers to fake the cash.  If a company can fake the cash they can just make up the books and it is a hard thing to do.  I was naive and lacked skills and expertise and knowledge.  Every time it happened I tried to learn from my mistakes.  Painful lessons but that is sometimes the only way I could learn.  The good thing though is that I have more experience and 1.  Don't invest what I don't understand and 2.  Really try to look at disconfirming facts very carefully with my own eyes.  In addition I have some ability to do forensic accounting.

 

I think there is an element of people being long not having the hard experience, ignoring it and not connecting the dots on VRX.

 

I think there were certain cases of disgusting bear raids - Overstock comes to mind.  Putting out false information smells illegal to me.

 

I don't think that is the case here at all.  The KGA Fullfillment Philidor connection, the R&O information and the Philidor connected pharmacies are cases in point.  VRX certainly didn't disclose any of this until they were forced to.

 

My purpose here is just to warn people about potential red flags and serious issues as I see them.  That may have helped me if I had been warned in the past.

 

 

 

I'll warn you. The same people that were involved in the "disgusting bear raid" that was Overstock were involved with Fairfax Financial, and some of those people are involved here including John Hempton, Roddy Boyd, and possibly much larger hedge funds. If you want a history lesson, I can give it to you. By the way, my view is AZ Value is probably John Hempton, and that you may also be affiliated.

 

Just my view, everyone can have a view. Right? Just like Andrew Left at Citron, however unsubstantiated.

 

Can you please give me the history lesson? Thank you!

[ccplz]

Also,

 

I have been caught in a few frauds before.  A couple companies were cooking the books.  Another one was a Chinese company that showed super high EBIT margins and then they bribed the bank managers to fake the cash.  If a company can fake the cash they can just make up the books and it is a hard thing to do.  I was naive and lacked skills and expertise and knowledge.  Every time it happened I tried to learn from my mistakes.  Painful lessons but that is sometimes the only way I could learn.  The good thing though is that I have more experience and 1.  Don't invest what I don't understand and 2.  Really try to look at disconfirming facts very carefully with my own eyes.  In addition I have some ability to do forensic accounting.

 

I think there is an element of people being long not having the hard experience, ignoring it and not connecting the dots on VRX.

 

I think there were certain cases of disgusting bear raids - Overstock comes to mind.  Putting out false information smells illegal to me.

 

I don't think that is the case here at all.  The KGA Fullfillment Philidor connection, the R&O information and the Philidor connected pharmacies are cases in point.  VRX certainly didn't disclose any of this until they were forced to.

 

My purpose here is just to warn people about potential red flags and serious issues as I see them.  That may have helped me if I had been warned in the past.

 

 

 

I'll warn you. The same people that were involved in the "disgusting bear raid" that was Overstock were involved with Fairfax Financial, and some of those people are involved here including John Hempton, Roddy Boyd, and possibly much larger hedge funds. If you want a history lesson, I can give it to you. By the way, my view is AZ Value is probably John Hempton, and that you may also be affiliated.

 

Just my view, everyone can have a view. Right? Just like Andrew Left at Citron, however unsubstantiated.

 

Seeing John Hemptons everywhere.. boy someone must've been traumatized by the last week...

[LongHaul]

The history lesson with Fairfax would be helpful as I know very little about the story.

 

Charlie Munger compared Pearson to Howard Geneen and ITT, only he said Pearson was worse.

Is Munger connected to anyone who is short or was he just trying to warn people about what he saw?

 

The truth about Valeant will eventually come out.  I certainly don't know the depths of it.

 

 

[Liberty]

The history lesson with Fairfax would be helpful as I know very little about the story.

 

Charlie Munger compared Pearson to Howard Geneen and ITT, only he said Pearson was worse.

Is Munger connected to anyone who is short or was he just trying to warn people about what he saw?

 

The truth about Valeant will eventually come out.  I certainly don't know the depths of it.

 

I think this follow up to the Munger comment is useful:

 

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/valeant-pharmaceutilcals-international-inc-(vrx)/msg222059/#msg222059

 

Ackman was asked about Charlie Munger's comments on Valeant on today's Pershing Square conference call and mentioned that he had had a chance to ask Charlie about his comments on VRX.  Charlie said basically that he did not know Mike Pearson personally and has heard very good things about him from people he respects.  But "Call me old fashioned" I don't like companies with low tax rates that use a lot of leverage and do a large amount of acquisitions quickly... "Call me old fashioned."

 

Ackman responded "well we will call Mr. Munger old fashioned"  Called Munger's criticism "fair" and said where it is not fair is that Valeant is not at all like ITT. (the conglomerate Mr. Munger made the unflattering comparison with)  ITT had a high priced stock and did a lot of acquisitions of businesses that had little to no strategic fit with each other and it was eventually broken up.  Valeant is not a random assemblage..  they are very strategic in wha

[original mungerville]

Also,

 

I have been caught in a few frauds before.  A couple companies were cooking the books.  Another one was a Chinese company that showed super high EBIT margins and then they bribed the bank managers to fake the cash.  If a company can fake the cash they can just make up the books and it is a hard thing to do.  I was naive and lacked skills and expertise and knowledge.  Every time it happened I tried to learn from my mistakes.  Painful lessons but that is sometimes the only way I could learn.  The good thing though is that I have more experience and 1.  Don't invest what I don't understand and 2.  Really try to look at disconfirming facts very carefully with my own eyes.  In addition I have some ability to do forensic accounting.

 

I think there is an element of people being long not having the hard experience, ignoring it and not connecting the dots on VRX.

 

I think there were certain cases of disgusting bear raids - Overstock comes to mind.  Putting out false information smells illegal to me.

 

I don't think that is the case here at all.  The KGA Fullfillment Philidor connection, the R&O information and the Philidor connected pharmacies are cases in point.  VRX certainly didn't disclose any of this until they were forced to.

 

My purpose here is just to warn people about potential red flags and serious issues as I see them.  That may have helped me if I had been warned in the past.

 

 

 

I'll warn you. The same people that were involved in the "disgusting bear raid" that was Overstock were involved with Fairfax Financial, and some of those people are involved here including John Hempton, Roddy Boyd, and possibly much larger hedge funds. If you want a history lesson, I can give it to you. By the way, my view is AZ Value is probably John Hempton, and that you may also be affiliated.

 

Just my view, everyone can have a view. Right? Just like Andrew Left at Citron, however unsubstantiated.

 

Seeing John Hemptons everywhere.. boy someone must've been traumatized by the last week...

 

No, I thought AZ Value was either connected to Hempton or Hempton himself in one of his first few posts or his Part 1 blog. I'm not traumatized at all, in fact, I like this situation of a lower stock price. I like it a lot.

[Liberty]

http://www.bloomberg.com/news/articles/2015-10-24/valeant-director-ingram-says-pearson-has-board-s-full-support

[feynmanresearch]

http://www.bloomberg.com/news/articles/2015-10-24/valeant-director-ingram-says-pearson-has-board-s-full-support

That doesn't mean anything. How many board of director members say anything negative about the CEO?

[KCLarkin]

Wow, a journalist actually spent more than two minutes thinking about this story

http://www.financialpost.com/m/wp/news/blog.html?b=business.financialpost.com/investing/market-moves/the-bad-boys-of-pharma-investors-love-them-until-cracks-in-the-model-appear&pubdata-ipsquote-timestamp=2015-10-23

[ZenaidaMacroura]

Also,

 

I have been caught in a few frauds before.  A couple companies were cooking the books.  Another one was a Chinese company that showed super high EBIT margins and then they bribed the bank managers to fake the cash.  If a company can fake the cash they can just make up the books and it is a hard thing to do.  I was naive and lacked skills and expertise and knowledge.  Every time it happened I tried to learn from my mistakes.  Painful lessons but that is sometimes the only way I could learn.  The good thing though is that I have more experience and 1.  Don't invest what I don't understand and 2.  Really try to look at disconfirming facts very carefully with my own eyes.  In addition I have some ability to do forensic accounting.

 

I think there is an element of people being long not having the hard experience, ignoring it and not connecting the dots on VRX.

 

I think there were certain cases of disgusting bear raids - Overstock comes to mind.  Putting out false information smells illegal to me.

 

I don't think that is the case here at all.  The KGA Fullfillment Philidor connection, the R&O information and the Philidor connected pharmacies are cases in point.  VRX certainly didn't disclose any of this until they were forced to.

 

My purpose here is just to warn people about potential red flags and serious issues as I see them.  That may have helped me if I had been warned in the past.

 

 

 

I'll warn you. The same people that were involved in the "disgusting bear raid" that was Overstock were involved with Fairfax Financial, and some of those people are involved here including John Hempton, Roddy Boyd, and possibly much larger hedge funds. If you want a history lesson, I can give it to you. By the way, my view is AZ Value is probably John Hempton, and that you may also be affiliated.

 

Just my view, everyone can have a view. Right? Just like Andrew Left at Citron, however unsubstantiated.

LongHaul isn't affiliated with Hempton -had dinner with him and the Houston cobaf gang a few times.  Vrx came up a few times -he was very thoughtful/well spoken and backed up his skepticism. 

 

I feel like AZ is not Hempton -their writing styles differ too much.  Hempton has a tongue-in-cheek style whereas AZ seems more brash... Just my opinion!