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Valeant weighs sales of controversial heart meds, laggard Provenge: Bloomberg

May 19, 2016
Life sciences

Valeant has been looking for ways to scale down its mountain of debt, and it may have landed on a couple.

The Canadian drugmaker is considering selling off Obagi Medical Products–a skincare buy from 2013–as well as Provenge, the laggard cancer vaccine it snapped up last year from bankrupt biotech Dendreon, according to Bloomberg’s sources. It’s also weighing a divestment of Isuprel and Nitropress, the jacked-up heart meds that last summer landed it in a wave of political and payer pushback that has yet to subside.

Of course, the sales process is still in the early stages–which could mean deals will happen for just some of those drugs, or none at all. But if Valeant can strike transactions for all of them, the divestitures could drum up a sum to the tune of $1 billion, the sources said.

It’s not the first time sales discussions have come up at the embattled drugmaker, which has been grappling with channel-stuffing allegations, underperforming sales and debt-default worries in addition to the pricing pressure. The company first broached the possibility of a sale of its controversial heart drugs last October, when then-CEO J. Michael Pearson admitted that holding onto the unit they belong to–Valeant’s neurology and “other” drugs business–“probably doesn’t make sense.”

And since then, new faces have cropped up at the Quebec-based pharma–and they’re eager to enact changes themselves. In March, shortly after joining Valeant’s board, activist investor Bill Ackman suggested selling part of eyecare business Bausch & Lomb could raise cash to pay down debt; the company could launch an IPO for a minority stake in the range of 10% to 20%, he reasoned.

One thing is certain–if it’s non-core assets Valeant is looking to shed, there are plenty of them to go around. The company made a number of debt-fueled buys after striking out on hostile target Allergan, some of which–such as Provenge, its first cancer med, and brodalumab, its first biologic candidate–raised eyebrows among industry watchers.

By Carly Helfand

Source: Fierce Pharma

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