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Probes Reporter Expects 'Array' Of Investigations At Valeant

Jayson Derrick

Correction: The previous version of this article, including the title, contained inaccuracies. The firm wrote it expects "an array of protracted, distracting, and expensive investigations." Those are not limited to the SEC.

  • Shares of Valeant Pharmaceuticals Intl Inc (NYSE: VRX) rebounded nearly 10 percent Friday morning but are still lower by more than 50 percent over the past three months.
  • is expecting an "array" of "protracted, distracting, and expensive investigations."
  • Probes Reporter noted that as of September 30 there was no ongoing SEC investigative activity at Valeant.

Shares of Valeant Pharmaceuticals continued to trade with heavily volatility on Friday. By late morning, the stock gained nearly 10 percent but have still lost more than 50 percent over the past three months.

, an independent investment research firm that focuses on public company interactions with regulatory agencies, said in a report on Friday that it now expects Valeant to face an "array of protracted, distracting, and expensive investigations."

The report added that "there's just too much going on" at the company for the regulators to overlook.

The report cited four key items that may warrant an investigation: 1) "significant" negative media attention that influenced the stock's direction, 2) an accounting or disclosure controversy, 3) "significant" stock price volatility of more than 10 percent, and 4) referrals from other government agencies, including criminal investigations.

"Given the complexity of the issues, paired with the company's very vocal proclamations of innocence, you should expect these investigations will be protracted, time-consumer, distracting, and expensive," the report said. "None of that is good for investors."

Meanwhile, a Canadian regulator has already said that no formal investigation of Valeant had started but it is "very seriously" watching the situation. The report suggested that "it's highly unusual for any regulator to comment in this fashion." In other words, "this is not good for Valeant."

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